Legislature(2009 - 2010)BARNES 124

02/02/2010 01:00 PM House MILITARY & VETERANS' AFFAIRS


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 274 ESTABLISHING PURPLE HEART DAY TELECONFERENCED
Moved Out of Committee
*+ HB 291 GUARANTEED REVENUE BONDS FOR VETERANS TELECONFERENCED
Heard & Held
*+ HB 292 GRANTS TO DISASTER VICTIMS TELECONFERENCED
Heard & Held
               HB 292-GRANTS TO DISASTER VICTIMS                                                                            
                                                                                                                                
1:54:31 PM                                                                                                                    
                                                                                                                                
CHAIR GATTO  announced that the  next order of business  would be                                                               
HOUSE BILL  NO. 292, "An Act  relating to grants to  victims of a                                                               
disaster in this state; and providing for an effective date."                                                                   
                                                                                                                                
1:54:48 PM                                                                                                                    
                                                                                                                                
McHUGH  PIERRE, Deputy  Commissioner,  Department  of Military  &                                                               
Veterans'  Affairs  (DMVA),  reminded  the  committee  the  state                                                               
suffered  monumental  disasters  last  year, two  of  which  were                                                               
Presidential Disaster  Declarations.   The largest  disaster, the                                                               
spring flood  that spread  from Eagle down  to the  Kuskokwim and                                                               
Yukon  Rivers, focused  attention on  the state's  Individual and                                                               
Family  Grant (IFG)  program,  portions of  which  have not  been                                                               
changed  since   1977.    For  example,   the  Federal  Emergency                                                               
Management Program  (FEMA) was granting  relief in the  amount of                                                               
approximately  $30,000 per  family, but  families eligible  under                                                               
the state disaster  declaration were receiving $5,000.   He said,                                                               
"It  was very  troubling to  witness  people who  were trying  to                                                               
rebuild ...  to see the  disparity when someone lost  their house                                                               
in  one  location of  our  state  and  another person  ...  [was]                                                               
eligible  for   different  amounts  of  service."     Mr.  Pierre                                                               
expressed  his  hope that  the  proposed  bill will  change  this                                                               
situation.                                                                                                                      
                                                                                                                                
1:56:25 PM                                                                                                                    
                                                                                                                                
MICHAEL   O'HARE,   Deputy   Director,   Division   of   Homeland                                                               
Security/Emergency Management  (DHS&EM),Department of  Military &                                                               
Veterans Affairs  (DMVA), explained that the  governor is limited                                                               
by statute to grant a  maximum of $5,000 in individual assistance                                                               
to  those  affected  in   a  state-declared  disaster  emergency.                                                               
Recent experience shows this amount  is just not enough; in fact,                                                               
in  current dollars  $5,000  in  1977 values  about  $18,500.   A                                                               
multi-agency task  force, including DMVA, DHS&EM,  the Department                                                               
of Health  and Social Services  (DHSS), the Department  of Public                                                               
Safety (DPS), AHFC, and the  U.S. Department of Agriculture Rural                                                               
Development,  recommended the  provisions  in  the proposed  bill                                                               
such  that  in  a  state-declared   disaster  or  emergency,  the                                                               
governor  may allow  individual  assistance grant  funding up  to                                                               
one-half of  the federal  amount.   Mr. O'Hare  further explained                                                               
that the  federal amount fluctuates  based on the  consumer price                                                               
index (CPI).   Therefore, the bill  amends the $5,000 limit  to a                                                               
more reasonable and current amount based on today's economy.                                                                    
                                                                                                                                
1:58:48 PM                                                                                                                    
                                                                                                                                
CHAIR  GATTO  posed a  scenario  in  which an  insured  homeowner                                                               
suffers a loss in a declared disaster zone.                                                                                     
                                                                                                                                
MR.  O'HARE  responded that  homeowners  with  insurance, or  the                                                               
means by  which to recover  from the  loss, are not  eligible; in                                                               
fact, DHS&EM has staff to  assess damages and the economic status                                                               
of victims.   In further response  to Chair Gatto, he  said cases                                                               
can also be reviewed as to the insured's deductable.                                                                            
                                                                                                                                
2:00:18 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TAMMIE WILSON asked why  the amount of $14,950 was                                                               
chosen for the eligibility amount.                                                                                              
                                                                                                                                
MR. O'HARE indicated that an increase  from $5,000 to half of the                                                               
FEMA Individual  Assistance (IA) allotment  "seemed appropriate."                                                               
He  estimated  that  only  30  percent of  those  affected  by  a                                                               
disaster will qualify for 100 percent of the eligible expenses.                                                                 
                                                                                                                                
MR.  PIERRE added  that this  recommendation came  from the  task                                                               
force  because a  state  disaster  is less  in  magnitude than  a                                                               
federal disaster.                                                                                                               
                                                                                                                                
MR.  O'HARE further  noted that  the amount  fluctuates with  the                                                               
CPI.  In  response to Chair Gatto, he clarified  that the maximum                                                               
an  individual  or  household  can qualify  for  is  the  federal                                                               
amount, not  both the state and  the federal amount.   Mr. O'Hare                                                               
further described the qualification process.                                                                                    
                                                                                                                                
2:03:00 PM                                                                                                                    
                                                                                                                                
CHAIR GATTO asked whether the  grant was a reimbursable amount or                                                               
"a check upfront to help you get started."                                                                                      
                                                                                                                                
MR.  O'HARE provided  the options  for payments,  verification of                                                               
expenses, and the methods for checking for non-compliance.                                                                      
                                                                                                                                
2:03:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BUCH assumed there is a pool of money.                                                                           
                                                                                                                                
MR. O'HARE said  yes, the Disaster Relief Fund  is funded through                                                               
the general  fund.  In  further response to  Representative Buch,                                                               
he relayed the fund consists  of approximately $100,000, which is                                                               
all that is left after the spring disaster cost $10 million.                                                                    
                                                                                                                                
MR.  PIERRE added  that his  department is  bound by  statute and                                                               
cannot   spend  more   than   $1   million  without   legislative                                                               
authorization.   However, the legislature has  forward-funded the                                                               
disaster  fund  in  the  amount  of $5  million  per  year.    If                                                               
necessary  during  the interim  or  session,  the department  can                                                               
request  the  legislative  leadership to  approve  additional  or                                                               
future funds.                                                                                                                   
                                                                                                                                
MR. O'HARE,  in response  to Chair Gatto,  explained that  in the                                                               
interim the leadership  of both bodies of  the legislature issues                                                               
the  authorization; during  session,  the  department requests  a                                                               
supplemental authorization.                                                                                                     
                                                                                                                                
2:05:49 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KAWASAKI  referred to the fiscal  note and pointed                                                               
out  that the  fiscal note  only  includes monies  that would  be                                                               
designated  to grantees;  therefore, there  is zero  overhead for                                                               
the agency.                                                                                                                     
                                                                                                                                
MR. O'HARE agreed.  Although  the fiscal note is speculative, the                                                               
sponsors have based its numbers on  an average over the past five                                                               
years.  In  further response to Representative  Kawasaki, he said                                                               
the bill identifies "U.S. code  42, which is that federal element                                                               
which fluctuates on the CPI."                                                                                                   
                                                                                                                                
MR. PIERRE further added that  the sponsors based the fiscal note                                                               
on the  amount "that we would  pay out this year,  so we've tried                                                               
to make it very appropriate to today's response...."                                                                            
                                                                                                                                
2:07:27 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BUCH expressed  his concern that at  the time this                                                               
obligation  would be  instituted, the  state will  enter into  an                                                               
extended period of potential shortfalls  in the budget.  In fact,                                                               
two  or three  disasters could  encumber the  state with  massive                                                               
obligations.   He warned  that to  triple the  state's obligation                                                               
seems to be a very expensive adjustment.                                                                                        
                                                                                                                                
MR.  PIERRE  stated  that the  department  shares  Representative                                                               
Buch's concerns; however, the intent  of the original language of                                                               
the fund  would be  equal to  an $18,000  expenditure today.   He                                                               
concluded that  the proposed bill  does not surpass  the original                                                               
intent of  the legislature and  encouraged the committee  to make                                                               
recommendations   after  considering   the  needs   of  Alaskans,                                                               
particularly those in rural areas.                                                                                              
                                                                                                                                
2:10:33 PM                                                                                                                    
                                                                                                                                
CHAIR GATTO  suggested the legislation  may need  "sideboards" to                                                               
prevent abuse of the benefits.                                                                                                  
                                                                                                                                
MR. O'HARE encouraged  Chair Gatto to meet his  staff who perform                                                               
damage  assessments  and  audits  in affected  communities.    He                                                               
assured  the committee  his staff  is diligent  in assessing  and                                                               
verifying losses of  items for which there may  not be documented                                                               
evidence, through interviews with elders and other individuals.                                                                 
                                                                                                                                
2:13:04 PM                                                                                                                    
                                                                                                                                
MR. PIERRE reminded the committee the maximum grant is $14,950.                                                                 
                                                                                                                                
2:13:40 PM                                                                                                                    
                                                                                                                                
MR. O'HARE said that he  shared the concern about the opportunity                                                               
for fraud,  but encouraged the  committee to focus on  the intent                                                               
of  the bill  that is  to help  those who  have been  affected by                                                               
disaster in a manner that  is appropriate in the current economy.                                                               
The state  is not  an insurance company,  and this  funding "will                                                               
only get them up on one knee, or maybe two feet."                                                                               
                                                                                                                                
2:14:49 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  RAMRAS  observed  that  fraud  is  a  crime,  and                                                               
although people  will abuse  the system,  most people  are honest                                                               
and most  times the reimbursement  or insurance payment  does not                                                               
leave  a  person  whole.    He  expressed  his  belief  that  the                                                               
overwhelming majority  of people who  would be eligible  for this                                                               
assistance are  honest.  Representative  Ramras said,  "We should                                                               
not  allow  the bad  behavior  of  ...  the  few to  affect  good                                                               
legislation for the many."                                                                                                      
                                                                                                                                
2:16:17 PM                                                                                                                    
                                                                                                                                
MR. O'HARE  assured the committee  that his staff  has prosecuted                                                               
fraudulent claims.                                                                                                              
                                                                                                                                
2:16:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BUCH said, "Doubling  the numbers of disasters and                                                               
tripling the response to that, we  would go from 10 to 60 million                                                               
dollars of obligation.  That's my concern."                                                                                     
                                                                                                                                
2:17:47 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TAMMIE WILSON  pointed out  that the  legislation                                                               
states, "may appropriate up to  $15,000."  Therefore, this amount                                                               
could be  changed by the  governor; in addition,  the legislature                                                               
must re-appropriate money  into the fund.  She  asked whether her                                                               
understanding of the legislation was correct.                                                                                   
                                                                                                                                
MR. O'HARE replied yes.                                                                                                         
                                                                                                                                
2:18:33 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KAWASAKI has heard that  is difficult to apply for                                                               
the  $5,000 due  to  the  lack of  receipts.    He surmised  that                                                               
raising the cap on eligibility might cause more people to apply.                                                                
                                                                                                                                
MR.  PIERRE  opined  that  more  people  will  not  apply.    The                                                               
department  already conducts  an aggressive  advertising campaign                                                               
in  affected disaster  areas during  which staff  are sent  in to                                                               
help with  the application  process.   Moreover, the  fiscal note                                                               
purposefully  reflects "a  very liberal  number there,  because I                                                               
wanted  to  show ...  the  maximum  impact,  in case  there  were                                                               
questions."                                                                                                                     
                                                                                                                                
2:20:14 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KAWASAKI  asked for confirmation that  the funding                                                               
would be just for the grant, and not for more man hours.                                                                        
                                                                                                                                
MR. PIERRE  indicated that DMVA  is a very small  department that                                                               
makes  up 0.3  percent  of  the overall  budget.    There are  70                                                               
employees  in Mr.  O'Hare's staff  at DHS&EM,  and there  are 300                                                               
state employees at  DMVA, with 4,000 National Guard  members.  He                                                               
stressed  that  DMVA employees  are  dedicated  to helping  folks                                                               
during times of disaster.                                                                                                       
                                                                                                                                
MR. O'HARE explained  that his staff sets  up disaster assistance                                                               
centers in  affected communities  to interview  local individuals                                                               
and verify damages.                                                                                                             
                                                                                                                                
MR.  PIERRE, in  response  to  Representative Kawasaki's  earlier                                                               
question  about  the  budget,  further  explained  that  although                                                               
employees  are  sometimes pulled  from  other  areas to  maintain                                                               
consistency in handling cases, the  amount of money and number of                                                               
staff remains the  same.  Furthermore, his  department is looking                                                               
for more  efficiency and  has reduced its  budget by  0.5 percent                                                               
this year.                                                                                                                      
                                                                                                                                
2:23:16 PM                                                                                                                    
                                                                                                                                
CHAIR  GATTO  questioned  whether  renters  who  purchased  flood                                                               
insurance at different times would benefit.                                                                                     
                                                                                                                                
MR. O'HARE answered that because  both renters would benefit from                                                               
flood insurance, they would not  qualify for this program, except                                                               
perhaps for the amount of the deductible.                                                                                       
                                                                                                                                
CHAIR  GATTO  referred to  the  last  page of  document  entitled                                                               
"State Individual and Family Grant Program (IFG)" and read:                                                                     
                                                                                                                                
     If the  grantee is  a renter, flood  insurance required                                                                    
     under this  section must be maintained  on the contents                                                                    
     of the rental  unit for as long as  the grantee resides                                                                    
     at the flood-damaged property address.                                                                                     
                                                                                                                                
MR.  O'HARE clarified  that owners  or renters  need to  have had                                                               
insurance coverage prior to the disaster.                                                                                       
                                                                                                                                
2:25:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAMRAS  asked what  happens to a  typical off-duty                                                               
enlisted soldier who volunteers for duty during an emergency.                                                                   
                                                                                                                                
MR.  PIERRE informed  the  committee that  in  an emergency,  the                                                               
local community  government sends  a disaster declaration  to the                                                               
state.  If  the governor agrees to declare a  state disaster, the                                                               
state emergency coordination center at  DHS&EM will task from the                                                               
local community "response-to-needs."   The community's request is                                                               
sent  to  the joint  force  commander  who asks  for  volunteers.                                                               
These volunteers are paid a  state active duty rate, according to                                                               
their rank,  from the  Disaster Relief Fund;  in fact,  their pay                                                               
from the  state is  in lieu  of their  regular week-end  drill or                                                               
annual training time paid by the federal government.                                                                            
                                                                                                                                
2:29:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KAWASAKI  asked whether the disaster  relief funds                                                               
can go to purposes other than directly to individuals.                                                                          
                                                                                                                                
MR. O'HARE  said yes.   The funds  also encompass  response costs                                                               
such as safety of life and  protection of property.  However, the                                                               
portion  of  the  bill being  discussed  addresses  the  recovery                                                               
aspect   of  a   disaster;  state   monies  to   assist  affected                                                               
individuals recover from a disaster.                                                                                            
                                                                                                                                
MR. PIERRE  added that disaster relief  funds are also used  in a                                                               
25  percent matching  fund program  with  FEMA.   In response  to                                                               
Chair  Gatto,   he  clarified  that   an  arrangement   with  the                                                               
Department of  Defense National Guard Bureau  allows for expenses                                                               
on the  federal side in response  to a disaster.   These expenses                                                               
are  paid through  federal training  funds; in  fact, to  pay for                                                               
expenses incurred during a disaster,  the department uses federal                                                               
funding through the  U.S. Property and Fiscal Office,  which is a                                                               
federal  [contractor] working  for the  National Guard  Bureau in                                                               
Washington, D.C.   The federal training monies can  be applied to                                                               
gasoline, trucks, repairs, and other expenses.                                                                                  
                                                                                                                                
2:31:46 PM                                                                                                                    
                                                                                                                                
CHAIR GATTO set aside HB 292.                                                                                                   
                                                                                                                                
[Although not formally announced, HB 292 was held.]                                                                             
                                                                                                                                

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