Legislature(1995 - 1996)
02/20/1995 01:34 PM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE BILL NO. 4 "An Act relating to absences from the state for purposes of determining residency under the permanent fund dividend program; and providing for an effective date." ROD MOURANT, STAFF, REPRESENTATIVE KOTT maintained that HB 4 will remedy a problem caused in a recent court ruling. The ruling disallowed Permanent Fund Dividend (PFD) payments to spouses of PFD recipients while accompanying an eligible spouse out of state on an allowable absence. The legislation would allow individuals who accompany an eligible spouse out of state on an allowable absence to retain their eligibility for a PFD if that was the only reason that the spouse was disallowed. He explained that the legislation applies retroactively to January 1, 1994. This was the first time the Permanent Fund Dividend Division disallowed dividends for that reason. He cited two cases involving local residents. He noted that there is a $600.0 hundred dollar current year fiscal note accompanying the legislation. The fiscal note will fund costs associated with contacting individuals that have not repealed their denial. Representative Brown noted that the legislation contains language similar to HB 392, which was introduced during the Eighteenth Legislative Session. She noted that some provisions of HB 392 were enacted as regulations. MIKE MCGEE, CHIEF OF PFD OPERATIONS, PERMANENT FUND DIVIDEND DIVISION, DEPARTMENT OF REVENUE explained that the court ruled that the regulation was in conflict with existing statute. The law stated that the Division could not use the residency of a spouse as the primary source of an individual's eligibility. The intent is to separate absences from residency. Representative Mulder asked for further clarification of the insertion of "maintains and demonstrates at all times an intent" and deletion of "intends" on line 27 and 18 on page 2. Mr. McGee explained that the change was made to be 9 consistent with the definition of "residency" in existing statute. Representative Brown noted that HB 392 proposed sixteen allowable absences. She observed that HB 4 contains eight allowable absences. Mr. Mourant explained that only the existing allowable absences were included due to the complexity of the issue. Co-Chair Hanley noted that the legislation does not specify that absences for educational purposes must be due to full- time participation. Mr. McGee stated that regulations specify full-time status of good standing must be maintained. Representative Martin noted that PFD checks were denied to many students in the previous year. Mr. McGee discussed reasons students were denied their dividends. Representative Navarre noted that many students were enrolled to vote on their campuses during the last presidential election. Out-of-state voter registration challenges their intent to return to Alaska. In response to a question by Representative Navarre, Mr. McGee noted that dividends will be paid from the subsequent year's permanent fund dividend. Payments made as a result of the legislation would be identified with the dividend payment. Representative Brown observed that HB 392 would have allowed absences while "attending a special education program to assist in the treatment of learning or physical disabilities or treatment of mental disorders if attendance is recommended by a licensed physician, psychologist, physical therapist, or the commissioner of eduction; attending full- time technical training as part of a career education program recognized by the Alaska commission on Postsecondary Education; and attending full-time an academic institution, seminar, or other program for continuing professional educational development, including a sabbatical, legal, or accounting program, recognized by the Alaska Commission on Postsecondary Education." She noted that the Department of Revenue requested the changes contained in HB 392. Mr. Mourant observed that the legislation was drafted independent of the Department of Revenue. He noted that item eight is the only item not contained in existing statute, AS 43.23.095 (8). Mr. McGee noted that the absences quoted by Representative Brown are included in regulation. Mr. McGee provided members with a copy of the regulations, 15 AAC 23.163 10 (Attachment 2). Representative Kohring spoke in support of HB 4. In response to a question by Representative Kohring, Mr. McGee reiterated that funding will be paid out of the over estimation of this year's dividend or off the top of next year's dividend payment. He added that individuals whose 1992 and 1993 PFD's were denied for other reasons and their denial overturned by appeal would also be paid. Representative Mulder MOVED to report CSHB 4 (STA) out of Committee with individual recommendations and with the accompanying fiscal note. CSHB 4 (STA) was reported out of Committee with a "do pass" recommendation and with a zero fiscal note by the Department of Revenue, dated 2/1/95.