Legislature(2015 - 2016)BARNES 124
03/16/2016 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB188 | |
| HB337 | |
| HB313 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 188 | TELECONFERENCED | |
| += | HB 337 | TELECONFERENCED | |
| += | HB 313 | TELECONFERENCED | |
| += | HB 263 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 188-PERSON W/DISABILITY SAVINGS ACCOUNTS
3:21:32 PM
CHAIR OLSON announced that the first order of business would be
HOUSE BILL NO. 188, "An Act relating to financial accounts for
persons with disabilities; relating to financial institutions;
relating to property exemptions; relating to securities; and
providing for an effective date."
3:22:14 PM
REPRESENTATIVE HUGHES moved to adopt the proposed committee
substitute (CS) for HB 188, labeled 29-LS0787\E, Bannister,
3/9/16, as the working document. There being no objection,
Version E was before the committee.
3:22:37 PM
KIM SKIPPER, Staff to Representative Saddler, Alaska State
Legislature, informed the committee the main change to HB 188
from the original version to Version E was that the Department
of Revenue would run the program instead of the Department of
Commerce, Community & Economic Development. Further changes
are: broader language has been added related to changes in
federal authorizing law; allows DOR to contract with other
states to join a consortium and share administrative tasks;
allows DOR to have an equal vote in the request for proposal
(RFP) process; allows DOR to contract with its own financial
institution under certain conditions. She paraphrased from the
following sectional analysis [original punctuation provided]:
Sec. 1: Cites this as the Alaska ABLE Act Savings
Program Act
Sec. 2: Creates a new chapter 65. Alaska Savings
Program for Eligible Individuals
Sec. 06.65.010: Program authorized. Authorizes
Alaska ABLE savings program in the Department - which
is the Alaska Department of Revenue. Allows it to
implement and administer the program under the Federal
ABLE Act.
Sec. 06.65.020: General department duties.
Outlines the duties of the department in implementing
and administering the program.
Sec. 06.65.030: Modification of program. Gives
the Department authority to modify the program in
accordance to any federal law changes
Sec. 06.65.040: Additional department powers.
Allows department to set fees for program transactions
and services and also develop marketing plan to
promote the ABLE program
Sec. 06.65.050: Contracting authority;
procurement exemption. Allows department to contract
with a person to assist in implementing the program,
provide services, join other states to obtain or
provide services for implementation, join a
cooperative effort with other states to provide
services for the program that could include investment
and record-keeping services. Allows state to join with
other states to allow an Alaska resident to
participate in a program in another state under
federal authorizing law and for an outside state to
participate in a program in this state. If contracting
with another state, AS 36.30 (Procurement Code) will
not apply.
Sec. 06.65.060: Investment oversight: Allows the
department to oversee and approve selection of
investment managers and advisors for the program, and
to oversee all investment disclosures and regulatory
filings related to program investments
Sec. 06.65.070: Financial contractor obligations:
outlines duties/obligations of the selected financial
contractor(s)
Sec. 06.65.080: Additional audits: Allows the
department to order an audit of the contractor's
financial operation and position in addition to annual
audit if the department has reason to be concerned
Sec. 06.65.090: Contract termination; non-renewal.
Gives department authority to not renew a financial
contract. If so it would take custody of the program
accounts and transfer them to another financial
contractor that offers similar program accounts
Sec. 06.65.100: Eligible individuals. Describes who is
eligible to participate in the program.
Sec. 06.65.110: Representative of eligible
individuals. Describes who may act as a representative
of the eligible individual who is a minor or lacks
decision-making capacity
Sec. 06.65.120: Program account ownership. States that
the owner of the program account is the designated
beneficiary.
Sec. 06.65.130: Number of program accounts. Allows
only one program account per designated beneficiary
under federal authorizing law.
Sec. 06.65.140: Program account application: Outlines
department procedures for program account applications
and information to be collected in that process
Sec. 06.65.150: Program account establishment fee.
Allows financial contractor to charge a nonrefundable
to establish program account. That fee to be
determined in the contract with the financial
contractor.
Sec. 06.65.160: Program account contributions.
Outlines how a person can make a contribution, the
limit authorized by federal law, allows department to
reject or withdraw a contribution that exceeds that
annual limit or maximum limit established by
authorizing law or if designated beneficiary is not
eligible, and that financial contractor must report
contributions to the IRS.
Sec. 06.65.170: Limited investment direction. Limits
to two the number of times a program account
investment can be changed.
Sec. 06.65.180: Change of designated beneficiary.
Allows a designated beneficiary or representative to
change beneficiary of an account to another eligible
individual in the family.
Sec. 06.65.190: Distribution for qualified expenses.
States that withdrawals from the program accounts may
only be used for qualified expenses for the designated
beneficiary.
Sec. 06.65.200: Rollover distribution. Subject to
federal law governing rollovers, a distribution from a
program account can be made to the same designated
beneficiary or another eligible individual in the
family, and the timeframe for that to be done.
Sec. 06.65.210: Statements. Requires that statements
re: program accounts be issued 4 times a year at times
established by the department and that the program
contractor provide related information at the
department's request.
Sec. 06.65.220: Preparation and filing. In addition to
other reports a financial contractor shall prepare and
file statements required under state and federal law
and other agencies.
Sec. 06.65.230: Separate accounting. Requires a
financial contractor to provide separate accounting
for each program account.
Sec. 06.65.240: Annual fee. Allows a financial
contractor may charge an annual fee for maintenance of
a program account.
Sec. 06.65.250: Use as security. Prohibits a program
account from being used as security for a loan
Sec. 06.65.260: Exemption from creditor claims. States
that a program account is exempt from a claim by a
creditor
Sec. 06.65.270: No state obligation. Declares that the
program does not create an obligation of the state,
department, or any agency to guarantee the return of
principal or pay interest on the principal in a
program account
Sec. 06.65.280: Confidentiality. Specifies that
program account information is confidential
Sec. 06.65.290: Exchange of information. Allows the
Department to exchange information with the Department
of Health and Social Services and other state agencies
to determine whether an individual is eligible
Sec. 06.65.300: Treatment under means test programs.
Specifies the program account amounts must be
disregarded in determining eligibility for means-
tested programs
Sec. 06.65.310: Deposit from permanent fund dividend.
Allows deposits to program accounts from the permanent
fund dividend
Sec. 06.65.320: Program expense fund. Establishes
program expense fund and describes it purpose and
operation
Sec. 06.65.330: Medicaid claims: Allows that the state
may file a claim against the program account of a
beneficiary who dies.
Sec. 06.65.340: Governing law. Establishes federal law
as governing to the extent of any conflict with state
law
Sec. 06.65.350: Regulations. Requires the department
to adopt implementing regulations
Sec. 06.65.360: Annual report. Requires the department
to evaluate the program each year and file an annual
report on or before the start of each legislative
session beginning in 2018
Sec. 06.65.390: Definitions.
Sec. 3:
AS 09.38.015(a): Creates an exemption for amounts in a
program account
Sec. 4: AS 36.30.850(b): Adds ABLE program account
oversight as a responsibility of the Commissioner of
Revenue
Sec 5: AS 40.25.120(a) is amended to create an
exception to public inspection for names, addresses,
and other program account identifying information
Sec. 6 AS 45.55.990(32): Excludes program accounts
from the definition of "security"
Sec. 7: AS 47.07.055: Allows the state to file a claim
against the designated beneficiary's program account
after the individual dies
Sec. 8: Transition
Requires the Department to file its first report on
the program on or before the first day of the Second
Regular Session of Thirtieth Alaska State Legislature
(2018)
Sec. 9: Transition
Allows the Department to adopt regulations, but not
before the effective date of the provisions
authorizing the Alaska ABLE savings program
Sec. 10: Effective Date
Section 9 takes effect immediately
3:32:46 PM
REPRESENTATIVE JOSEPHSON returned attention to proposed Section
06.65.180 [text previously provided], and questioned why
accounts should be transferred from the designated beneficiary
to another member of the family.
MS. SKIPPER deferred to legal counsel for Autism Speaks.
3:33:42 PM
STUART SPIELMAN, Senior Policy Advisor and Counsel, Autism
Speaks, stated that this provision is consistent with federal
law that provides for rollovers between affected [qualified]
family members. It is not uncommon that individuals with
disabilities have affected family members.
REPRESENTATIVE JOSEPHSON returned attention to proposed Section
06.65.260 [text previously provided], and asked whether a
disabled person can enter into a contract that is lawful, and if
so, whether the contract is attachable in the case of a dispute.
MR. SPIELMAN advised this is another provision in the federal
law. An individual with a disability is presumed to be
competent in most states; however, such as in bankruptcy law
that protects one's housing, there are certain protections for
assets.
REPRESENTATIVE LEDOUX directed attention to proposed Section
06.65.260 [text previously provided], and pointed out that the
account can hold up to $400,000, which is a significant
exemption, and presuming that individuals with disabilities can
enter into contracts, she expressed her concern.
CHAIR OLSON opined that most accounts would be for lower
amounts.
REPRESENTATIVE LEDOUX agreed, but the exemption includes those
who do have $400,000, and she suggested a cap at a lower level.
3:40:33 PM
The committee took an at ease from 3:40 p.m. to 3:43 p.m.
3:43:12 PM
MR. SPIELMAN, in response to Representative LeDoux, said he
would respond in writing to the question as to whether states
could reduce the cap.
REPRESENTATIVE HUGHES directed attention to proposed Section
06.65.160 [text previously provided], and asked whether excess
funds must be returned to the designated beneficiary.
MS. SKIPPER said correct.
REPRESENTATIVE HUGHES directed attention to proposed Section
06.65.310 [text previously provided], and asked for the purpose
of including a provision that allows for the deposit of a
permanent fund dividend.
MS. SKIPPER stated the sponsor intended "to just like the
college savings plan, to have a check-off box"; however, at this
time beneficiaries would follow the procedure for a direct
deposit.
3:45:40 PM
CHAIR OLSON, after ascertaining no one else wished to testify,
closed public testimony,
[HB 188 was held over.]