Legislature(2021 - 2022)SENATE FINANCE 532

05/16/2022 09:00 AM Senate FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 306 EXTEND BOARD OF PHARMACY TELECONFERENCED
<Bill Hearing Rescheduled to 1:00 pm>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
*+ HB 308 DEMENTIA AWARENESS & HEALTHCARE CAPACITY TELECONFERENCED
<Bill Hearing Rescheduled to 1:00 pm>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
*+ HB 322 AK MARINE HWY FUNDS, HIGHER ED INVES FUND TELECONFERENCED
Heard & Held
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
+ SB 160 FLOOD INSURANCE TELECONFERENCED
<Bill Hearing Canceled>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
+ HB 55 PEACE OFFICER/FIREFIGHTER RETIRE BENEFITS TELECONFERENCED
Heard & Held
Invited Testimony
-- Public Testimony <Will Be Rescheduled> --
*+ HB 177 REVISED PROGRAM: APPROPRIATIONS TELECONFERENCED
<Bill Hearing Canceled>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
+= HB 169 APPROP: EDUCATION; PUPIL TRANSPORTATION TELECONFERENCED
<Bill Hearing Canceled>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
+ HB 246 ACCESS TO MARIJUANA CONVICTION RECORDS TELECONFERENCED
<Bill Hearing Canceled>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
+ HB 289 AK MARIJUANA INDUSTRY TASK FORCE TELECONFERENCED
<Bill Hearing Canceled>
Invited Testimony
-- Public Testimony <Time Limit May Be Set> --
*+ HB 120 STATE LAND SALES AND LEASES; RIVERS TELECONFERENCED
<Bill Hearing Canceled>
<Pending Introduction & Referral>
-- Public Testimony <Time Limit May Be Set> --
-- Invited & Public Testimony --
                 SENATE FINANCE COMMITTEE                                                                                       
                       May 16, 2022                                                                                             
                         9:04 a.m.                                                                                              
                                                                                                                                
                                                                                                                                
9:04:42 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Bishop called the Senate Finance Committee meeting                                                                     
to order at 9:04 a.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Click Bishop, Co-Chair                                                                                                  
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson                                                                                                             
Senator Natasha von Imhof                                                                                                       
Senator Bill Wielechowski                                                                                                       
Senator David Wilson                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Representative  Andy  Josephson,  Sponsor;  William  "Flick"                                                                    
Fornia,   Pension  Trust   Advisor;   Tom  Wescott,   Former                                                                    
President,  Alaska  Professional  Firefighters  Association;                                                                    
Kerry Crocker, Staff, Representative Louise Stutes.                                                                             
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
CSHB 55(FIN)                                                                                                                    
         PEACE OFFICER/FIREFIGHTER RETIRE BENEFITS                                                                              
                                                                                                                                
          CSHB 55(FIN) was HEARD and HELD in committee for                                                                      
          further consideration.                                                                                                
                                                                                                                                
CSHB 322(TRA)                                                                                                                   
         AK MARINE HWY FUNDS, HIGHER ED INVES FUND                                                                              
                                                                                                                                
          CSHB 322(TRA) was HEARD and HELD in committee for                                                                     
          further consideration.                                                                                                
                                                                                                                                
CS FOR HOUSE BILL NO. 55(FIN)                                                                                                 
                                                                                                                                
     "An  Act relating  to  participation  of certain  peace                                                                    
     officers and  firefighters in  the defined  benefit and                                                                    
     defined  contribution plans  of  the Public  Employees'                                                                    
     Retirement  System of  Alaska; relating  to eligibility                                                                    
     of  peace   officers  and  firefighters   for  medical,                                                                    
     disability, and  death benefits; relating  to liability                                                                    
     of the  Public Employees' Retirement System  of Alaska;                                                                    
     and providing for an effective date."                                                                                      
                                                                                                                                
9:06:04 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ANDY  JOSEPHSON,   SPONSOR,  introduced  the                                                                    
legislation.  He stated  that HB  55  aims to  create a  new                                                                    
hybrid retirement plan option  for state and municipal peace                                                                    
officers   and   firefighters   under  the   Alaska   Public                                                                    
Employees'  Retirement System  (PERS)  with new  protections                                                                    
for the state against  unforeseen future liabilities. Alaska                                                                    
ended the defined  benefit plan in 2006  after we discovered                                                                    
that   those  accounts   were   too   underfunded  to   meet                                                                    
anticipated  retiree  obligations.  Since these  plans  were                                                                    
eliminated,   one  of   Alaska's   greatest  public   safety                                                                    
challenges  has become  employee retention  and recruitment.                                                                    
Alaska  is  one  of  the few  jurisdictions  that  does  not                                                                    
presently offer  a defined benefit  type retirement  for new                                                                    
public  safety   employees.  Additionally,   many  municipal                                                                    
public employees  do not participate  in Social  Security or                                                                    
the Supplemental Annuity Plan (SBS-AP).  HB 55 is crafted to                                                                    
retain and  attract quality peace officers  and firefighters                                                                    
while protecting the state  from unnecessary financial risks                                                                    
in the future. The proposed  option would allow future peace                                                                    
officers and firefighters under  the PERS system and current                                                                    
ones  under  the PERS  Tier  IV  plan  to join  the  defined                                                                    
benefit  plan.  The  proposal  includes  several  safeguards                                                                    
modeled  after the  most fiscally  responsible plans  in the                                                                    
nation.  These   safeguards  provide  stability   and  would                                                                    
provide the state with fiscal  certainty about their ability                                                                    
to maintain adequate funding for  this plan into the future.                                                                    
These  provisions include  a minimum  retirement  age of  55                                                                    
with  20  years  of service,  flexibility  setting  employee                                                                    
contribution    rates,   minimum    12   percent    employer                                                                    
contribution  rates, mechanisms  to prevent  costly "pension                                                                    
spiking,"   and  the   ability   to  withhold   post-pension                                                                    
retirement adjustments should the  plan's funding drop below                                                                    
90 percent.  The new  tier will closely  mirror Tier  III of                                                                    
PERS for public safety employees,  with the exception of two                                                                    
cost saving  measures: the continued  inclusion of  the Tier                                                                    
IV   defined    contribution   retirement    plan's   health                                                                    
reimbursement arrangement (HRA) and  the absence of cost-of-                                                                    
living  adjustments. HB  55  will be  a  step toward  making                                                                    
Alaska  more  attractive  to public  safety  employees.  The                                                                    
nature  of the  jobs  that peace  officers and  firefighters                                                                    
hold  are   uniquely  physically  demanding   and  hazardous                                                                    
compared  to other  public employees,  and all  Alaskans pay                                                                    
the cost for understaffed public safety agencies.                                                                               
                                                                                                                                
9:14:56 AM                                                                                                                    
                                                                                                                                
Co-Chair Bishop  wondered what  other state  did not  have a                                                                    
defined benefit for firefighters.                                                                                               
                                                                                                                                
Representative Josephson replied that he did not know.                                                                          
                                                                                                                                
9:15:26 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:16:00 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
9:16:25 AM                                                                                                                    
                                                                                                                                
WILLIAM  "FLICK" FORNIA,  PENSION TRUST  ADVISOR, introduced                                                                    
himself.                                                                                                                        
                                                                                                                                
9:16:38 AM                                                                                                                    
                                                                                                                                
TOM   WESCOTT,   FORMER   PRESIDENT,   ALASKA   PROFESSIONAL                                                                    
FIREFIGHTERS ASSOCIATION, introduced himself.                                                                                   
                                                                                                                                
Mr. Fornia  discussed the presentation, "Shared  Risk Hybrid                                                                    
Retirement  Program for  Public  Safety, HB  55    Actuarial                                                                    
Implications"  (copy  on  file).   He  looked  at  slide  2,                                                                    
"William B. Fornia, FSA Credentials":                                                                                           
                                                                                                                                
     ? Highest Actuarial Credentials                                                                                            
            Fellow of the Society of Actuaries (1986)                                                                           
            Enrolled Actuary under ERISA (1984)                                                                                 
            Member of the American Academy of Actuaries                                                                         
          (1983)                                                                                                                
            Elected to Board of Directors of 35,000-member                                                                      
          Society of Actuaries                                                                                                  
       Author and Frequent Speaker                                                                                              
             "Still  A  Better  Bang  for  the  Buck"  (with                                                                    
          National Institute on Retirement Security), 2014                                                                      
             "Are  California  Teachers Better  off  with  a                                                                    
          Pension  or   401(k)"  University   of  California                                                                    
          Berkeley Labor  Center and Journal  of Retirement,                                                                    
          2016                                                                                                                  
             Frequent  Testimony  to Legislatures  and  City                                                                    
          Councils                                                                                                              
            Regular Expert Witness (Detroit, Stockton)                                                                          
                                                                                                                                
Mr. Fornia pointed to slide 3, "Sample Work History":                                                                           
                                                                                                                                
     ? Corporate actuary for Boeing 1980-1984                                                                                   
     ? Founded Pension Trustee Advisors in 2010                                                                                 
     ? Alaska related experience                                                                                                
            ARMB first ongoing review actuary 2005-2006                                                                         
             Audited  Alaska PERS/TRS  actuarial  valuations                                                                    
          2009                                                                                                                  
             Former  leader   of  Buck  Consultants'  Denver                                                                    
          retirement practice                                                                                                   
            Advisors  to labor groups since  2011, including                                                                    
          testimony                                                                                                             
     ? Consulting services for 23 statewide retirement                                                                          
     systems in Alaska,                                                                                                         
     Colorado, Missouri, North Dakota, Oklahoma, Puerto                                                                         
     Rico, Utah, Texas,                                                                                                         
     Wyoming and others.                                                                                                        
             Served  as system  actuary  for  most of  these                                                                    
          (including CO, MO, ND, OK, WY)                                                                                        
             Ongoing  consultant  to Ohio  Retirement  Study                                                                    
          Council, including reform                                                                                             
     ? Expert testimony and consulting for governments,                                                                         
     pension systems, and labor groups                                                                                          
     ? Other clients have included the US Department of                                                                         
     State, Cities of Baltimore, New York and Philadelphia,                                                                     
     IBM, US WEST and Ford                                                                                                      
                                                                                                                                
9:18:38 AM                                                                                                                    
                                                                                                                                
Mr. Fornia addressed slide 4, "Shared-Risk Hybrid                                                                               
Retirement Program for Public Safety":                                                                                          
                                                                                                                                
     ? How did we get here?                                                                                                     
     ? Why is change necessary?                                                                                                 
     ? Actuarial Implications                                                                                                   
     ? Illustration of Financial Projections                                                                                    
                                                                                                                                
Mr.  Fornia   pointed  to   slide  5,   "Shared-Risk  Hybrid                                                                    
Retirement Program for Public Safety."                                                                                          
                                                                                                                                
Co-Chair Bishop stated that he would manage the table.                                                                          
                                                                                                                                
Mr. Fornia addressed slide  6, "Illustration of hypothetical                                                                    
police/fire benefits: $80,000 Final Average Salary."                                                                            
                                                                                                                                
9:23:16 AM                                                                                                                    
                                                                                                                                
Senator von  Imhof queried the  findings within  the private                                                                    
sector for workers with only a 401K retirement account.                                                                         
                                                                                                                                
Mr. Fornia  replied that  the answer  was mostly  related to                                                                    
the amount of money saved in  a 401K. He stressed that those                                                                    
making  a median  or lower  income level  who would  see the                                                                    
most impact.                                                                                                                    
                                                                                                                                
Senator  von  Imhof  wondered what  private  companies  were                                                                    
doing for their employees.                                                                                                      
                                                                                                                                
Mr.  Fornia  replied that  those  companies  were putting  6                                                                    
percent of pay into social security.                                                                                            
                                                                                                                                
9:25:35 AM                                                                                                                    
                                                                                                                                
Senator  von Imhof  felt that  the  public safety  employees                                                                    
should be  considered separate from other  public employees,                                                                    
because they put  their lives at risk.  Therefore, she found                                                                    
aspects of  the bill  attractive. She pointed  out, however,                                                                    
that  defined benefits  were  very  expensive. She  wondered                                                                    
whether  there  could  be a  reentry  into  social  security                                                                    
contributions.                                                                                                                  
                                                                                                                                
Mr. Fornia replied that he did not know.                                                                                        
                                                                                                                                
Co-Chair Stedman  recalled that at the  time of establishing                                                                    
the Tier IV system, it was  comparative to Tier III in order                                                                    
to  avoid multiple  contrasting tiers.  He wondered  whether                                                                    
there was an alternative way  to enter into social security,                                                                    
specifically whether it could be optional.                                                                                      
                                                                                                                                
Mr.  Fornia replied  that  a  person could  not  opt out  of                                                                    
social security.                                                                                                                
                                                                                                                                
9:31:52 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman asked  for a  summary of  the supplemental                                                                    
benefits system.                                                                                                                
                                                                                                                                
Mr. Fornia replied that the  supplemental benefit system was                                                                    
similar  to social  security, which  was  a defined  benefit                                                                    
plan. He  remarked that  individuals within  social security                                                                    
could  not opt  in, unless  they get  another job  that paid                                                                    
into social security.                                                                                                           
                                                                                                                                
Co-Chair   Stedman   remarked   that  the   stated   had   a                                                                    
supplemental  benefit system,  because the  state had  opted                                                                    
out of social security.                                                                                                         
                                                                                                                                
9:36:32 AM                                                                                                                    
                                                                                                                                
Senator  von   Imhof  recalled   that  the   teachers  union                                                                    
conducted a  study about  what it  would take  to opt  in to                                                                    
social security,  which found that  it required a  vote from                                                                    
the local school board. She  stated that any single district                                                                    
could allow a vote to opt back into social security.                                                                            
                                                                                                                                
Senator Wielechowski  wondered what  happened when  a person                                                                    
retires during  a time  of low market,  and how  it impacted                                                                    
the Tier IV defined contribution benefit.                                                                                       
                                                                                                                                
Mr. Fornia noted  that there would be some  people that  did                                                                    
well   under Tier  IV if  they retire  at a  point when  the                                                                    
market is at an escalation.  He stressed that the bill would                                                                    
cost employers much less than paying into social security.                                                                      
                                                                                                                                
9:40:56 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman  recalled  that the  supplemental  benefit                                                                    
system cost the state billions of dollars.                                                                                      
                                                                                                                                
Senator Wilson  wondered whether  the bill would  change the                                                                    
benefits for the municipal public safety employees.                                                                             
                                                                                                                                
Mr. Fornia  replied in the  affirmative and stated  that the                                                                    
fiscal  note  identified  additional cost,  which  would  be                                                                    
picked up by the state.                                                                                                         
                                                                                                                                
Co-Chair  Bishop noted  that Senator  Olson  had joined  the                                                                    
meeting.                                                                                                                        
                                                                                                                                
Mr.  Fornia continued  to discuss  the fiscal  note and  the                                                                    
fiduciary  risk to  the state.  He looked  at slide  7, "Key                                                                    
Considerations    with    Shared-Risk   Hybrid    Retirement                                                                    
Programs":                                                                                                                      
                                                                                                                                
     ? DB Plans are more cost effective at providing                                                                            
     retirement benefits                                                                                                        
          DB pension plans pool "longevity risks"                                                                               
             DB   pension  plans   can  maintain   a  better                                                                    
          diversified     portfolio      because,     unlike                                                                    
          individuals, they do not age                                                                                          
             DB  pension  plans  achieve  better  investment                                                                    
          returns because  of professional  asset management                                                                    
          and lower fees                                                                                                        
     ? DC Plans are more consistent with individual                                                                             
     responsibility                                                                                                             
            Benefit  is a clearly defined  contribution from                                                                    
          the employer and employee to a trust                                                                                  
             Benefit  is more  under  the  control and  full                                                                    
          ownership of the individual                                                                                           
            Benefit is much more portable                                                                                       
            No risk of unfunded liabilities to employer                                                                         
     ? Shared-Risk Hybrid Plans have many features of both                                                                      
            Cost-effectiveness of DB plans                                                                                      
            But  not all of  the actuarial risk is  borne by                                                                    
          the employer                                                                                                          
                                                                                                                                
Mr. Fornia discussed slide 8, "Actuarial Implications of HB
55":                                                                                                                            
                                                                                                                                
     ? Buck Fiscal note shows modest cost                                                                                       
     ? Risk to State is "Adverse Plan Experience"                                                                               
     ? HB 55 Plan has Safeguards to mitigate this risk                                                                          
     ? We have performed simulations to analyze this risk                                                                       
                                                                                                                                
Mr. Fornia displayed slide 9, "How does HB 55 strike a                                                                          
compromise?"                                                                                                                    
                                                                                                                                
     ? Start with 12 percent fixed employer contribution                                                                        
     and manage plan within that target as possible                                                                             
     ? Design current target benefit levels                                                                                     
            Consider benefits provided by DCR and latest DB                                                                     
     ? Build in benefit and/or employee contribution                                                                            
     adjustment mechanisms                                                                                                      
    ? These provide cushion against adverse experience                                                                          
                                                                                                                                
Mr. Fornia pointed to slide 10, "Safeguard 1: Reduce                                                                            
benefits vis--vis Tier 3":                                                                                                      
                                                                                                                                
     ? Minimum Age 55 eligibility                                                                                               
     ? Five-year average salary                                                                                                 
     ? Eliminate Alaska 10 percent COLA                                                                                         
     ? Eliminate pre-Medicare health coverage                                                                                   
       Suspend  Post-Retirement Pension Adjustment  when not                                                                    
     well funded                                                                                                                
     ? Increase employee and employer  contributions up to 2                                                                    
     percent each if not well funded                                                                                            
            Amended to permit employee increase by 4                                                                            
          percent                                                                                                               
                                                                                                                                
Mr. Fornia looked at slide 11, "Safeguard 2: Actuarial                                                                          
Methods":                                                                                                                       
                                                                                                                                
     ? Build in margin in actuarial assumptions                                                                                 
     ?  Build  reserves  in  good  times  to  provide  added                                                                    
     funding during bad times                                                                                                   
     ?  Compare  12  percent  +   8  percent  =  20  percent                                                                    
     contributions with costs above                                                                                             
            16.35 percent cost for pension based on 7.00                                                                        
          percent returns                                                                                                       
            HRA and Medicare Supplement are another 2.92                                                                        
          percent                                                                                                               
           This provides cushion of 0.73 percent                                                                                
            Additional 8.04 percent available through PRPA                                                                      
          suspension and additional 4 percent+2 percent                                                                         
          employee and employer contributions                                                                                   
                                                                                                                                
9:45:05 AM                                                                                                                    
                                                                                                                                
Mr. Fornia discussed slide 12, "Safeguard 3: Reduced                                                                            
Discount Rate":                                                                                                                 
                                                                                                                                
     ? Target  the pension  benefits of  the latest  DB tier                                                                    
     and health care benefits of the current DC tier                                                                            
     ? Determine the costs based  on 7 percent discount rate                                                                    
     rather than 7.38 percent assumed by PERS actuary                                                                           
     ?  Seek additional  funding for  this  level, and  then                                                                    
     commit to  this fixed employer contribution  rate going                                                                    
     forward                                                                                                                    
            This is 12 percent employer contribution for                                                                        
          Police and Fire employers                                                                                             
     ?  Monitor   experience  and  adjust   benefits  and/or                                                                    
     contributions as necessary going forward                                                                                   
                                                                                                                                
Mr. Fornia addressed slide 13, "Benefit Plan Return                                                                             
Thresholds":                                                                                                                    
                                                                                                                                
     ? ARMB Actuary assumes 7.38 percent return                                                                                 
     ? We've built HB55 plan around 7.00 percent                                                                                
     ? If we earn 6.62 percent  each year, will not be below                                                                    
     90 percent funded for fifty years                                                                                          
     ?  If   we  earn  6.49  percent   each  year,  employee                                                                    
     contribution increases will be triggered                                                                                   
     ? If  we earn  5.43 percent each  year, will  also have                                                                    
     frequent suspension of PRPA                                                                                                
                                                                                                                                
Mr. Fornia looked at slide 14, "Benefit Plan Simulations -                                                                      
2019 Baseline":                                                                                                                 
                                                                                                                                
     ? We modelled how plan  might have worked under various                                                                    
     returns                                                                                                                    
     ?  If fund  earns 6.6  percent for  next ten  years, as                                                                    
     ARMB   investment  consultant   estimates,  then   7.38                                                                    
     percent  (consistent  with   long-term  PERS  actuarial                                                                    
     consultants) thereafter                                                                                                    
            Plan will grow to 107 percent funded by 20                                                                          
          years                                                                                                                 
            Never below 100 percent funded                                                                                      
            Funded ratios based on conservative 7.00                                                                            
          percent                                                                                                               
               ? Current actuary uses 7.38 percent                                                                              
                                                                                                                                
Mr. Fornia discussed slide 15, "Benefit Plan Simulations -                                                                      
Historical":                                                                                                                    
                                                                                                                                
     ? We modelled how plan  might have worked under various                                                                    
     returns consistent with PERS returns                                                                                       
     ?  Considering each  20-year period  from 1980-2000  to                                                                    
     2000-2020                                                                                                                  
            Median case was if 1995-2015 was replicated                                                                         
               ? 9.1 percent average return                                                                                     
              ? Never falls below 90 percent                                                                                    
            Worst case was if 2000-2020 was replicated                                                                          
               ? 8.6 percent average return                                                                                     
               ? Falls below 90 percent for 3 of those 20                                                                       
               years, by end would be 99 percent funded                                                                         
            75 percentile best case was if 1986-2006                                                                            
          replicate                                                                                                             
               ? 10.2 percent average return                                                                                    
               ? Would be 133 percent funded after 20 years                                                                     
                                                                                                                                
Mr. Fornia  addressed slide 16, "Benefit  Plan Simulations -                                                                    
Historical." He discussed the  orange line which represented                                                                    
50 percentile  Median Case 1995-2015.  He stressed  that the                                                                    
idea was to avoid being poorly  funded. He spoke of the tech                                                                    
bubble  burst in  2000 and  the recession  of 2008.  He said                                                                    
that the plan had been stress tested.                                                                                           
                                                                                                                                
Co-Chair Bishop felt  that the wrong people  had been bailed                                                                    
out by the federal government in 2008.                                                                                          
                                                                                                                                
Senator Wielechowski  thought that  the bill was  timely and                                                                    
reasonable.                                                                                                                     
                                                                                                                                
9:50:36 AM                                                                                                                    
                                                                                                                                
Co-Chair Bishop asked whether the  slide had been modeled on                                                                    
the entire state workforce.                                                                                                     
                                                                                                                                
Mr. Fornia  said that it  would not  matter the size  of the                                                                    
group.                                                                                                                          
                                                                                                                                
Co-Chair Stedman voiced concern that  adding a new tier that                                                                    
shifted  the risk  to an  employee could  de detrimental  to                                                                    
future employees and retirees.                                                                                                  
                                                                                                                                
Mr. Fornia thought that Co-Chair  Stedman made a good point.                                                                    
He said that the retirees would have skin in the game                                                                           
                                                                                                                                
Co-Chair Bishop asked about the other clients.                                                                                  
                                                                                                                                
Mr. Fornia said they were public sector.                                                                                        
                                                                                                                                
Senator  Wilson  asked  how many  other  states  fared  with                                                                    
retention of public safety employees.                                                                                           
                                                                                                                                
Mr. Wescott  replied that public  safety employees  had left                                                                    
the state because of retirement and benefits.                                                                                   
                                                                                                                                
Senator  Wilson asked  about retention  of new  officers and                                                                    
firefighters nationwide.                                                                                                        
                                                                                                                                
Mr.  Wescott said  that  people who  were  leaving were  not                                                                    
leaving service but moving to other states.                                                                                     
                                                                                                                                
9:58:37 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman   stressed  that  it  was   voluntary  for                                                                    
communities to buy into the state system.                                                                                       
                                                                                                                                
Mr. Wescott  believed that there  had been  legislation that                                                                    
required PERS members to stay in the system.                                                                                    
                                                                                                                                
10:00:44 AM                                                                                                                   
                                                                                                                                
Co-Chair  Stedman felt  that a  community could  start their                                                                    
own retirement tier.                                                                                                            
                                                                                                                                
Senator  von Imhof  requested an  analysis  of the  turnover                                                                    
rate of the employees.                                                                                                          
                                                                                                                                
Senator  Wielechowski   stressed  that  the   public  safety                                                                    
employees were taking  a risk everyday at  work. He wondered                                                                    
whether the bill would cost the state additional money.                                                                         
                                                                                                                                
Mr. Fornia replied  that the fiscal note that  it would cost                                                                    
approximately 2 percent of the employer pay.                                                                                    
                                                                                                                                
10:06:17 AM                                                                                                                   
                                                                                                                                
Senator  von Imhof  stressed  that felt  that  the cost  was                                                                    
small to keep people safe.                                                                                                      
                                                                                                                                
CS HB55  (FIN) was HEARD  and HELD in committee  for further                                                                    
consideration.                                                                                                                  
                                                                                                                                
CS FOR HOUSE BILL NO. 322(TRA) am                                                                                             
                                                                                                                                
     "An Act  relating to the  Alaska marine  highway system                                                                    
     fund;  relating to  the  Alaska  marine highway  system                                                                    
     vessel replacement fund; relating  to the Alaska higher                                                                    
     education  investment   fund;  and  providing   for  an                                                                    
     effective date."                                                                                                           
                                                                                                                                
10:07:29 AM                                                                                                                   
                                                                                                                                
KERRY   CROCKER,   STAFF,  REPRESENTATIVE   LOUISE   STUTES,                                                                    
introduced the  legislation. He stated  that the  bill would                                                                    
move the  Alaska marine highway  system fund and  the vessel                                                                    
replacement  fund to  the state  treasury  from the  general                                                                    
fund.                                                                                                                           
                                                                                                                                
Senator  Wilson  wondered  whether  the  bill  would  create                                                                    
 winners and losers about which funds would be sweepable.                                                                       
                                                                                                                                
Mr.  Crocker  replied  that  the  process  showed  that  the                                                                    
product added two funds to the list.                                                                                            
                                                                                                                                
Senator Wilson  felt that eleven  more funds could  be added                                                                    
to the list.                                                                                                                    
                                                                                                                                
10:10:47 AM                                                                                                                   
                                                                                                                                
Co-Chair  Stedman felt  that the  marine highways  funds had                                                                    
specific  requirements,  so  there  should  be  a  different                                                                    
determination of those funds.                                                                                                   
                                                                                                                                
Senator  Wilson  felt  that the  crime  victim  compensation                                                                    
funds  was more  important for  his district.  He felt  that                                                                    
there were  many funds in  the account that  benefitted many                                                                    
Alaskans.                                                                                                                       
                                                                                                                                
Co-Chair Bishop OPENED and CLOSED public testimony.                                                                             
                                                                                                                                
10:13:51 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:14:14 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Bishop discussed the afternoon meeting's agenda.                                                                       
                                                                                                                                
CSHB 322(TRA)  was HEARD and  HELD in committee  for further                                                                    
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
10:14:37 AM                                                                                                                   
                                                                                                                                
The meeting was adjourned at 10:15 a.m.                                                                                         

Document Name Date/Time Subjects
HB 55- Fornia Actuarial Presentation to Senate Finance 5.15.22.pdf SFIN 5/16/2022 9:00:00 AM
HB 55
HB 55 Testimony Packet 4.pdf SFIN 5/16/2022 9:00:00 AM
HB 55
HB 55 Testimony Packet 3.pdf SFIN 5/16/2022 9:00:00 AM
HB 55
HB 55 Testimony Packet 5.pdf SFIN 5/16/2022 9:00:00 AM
HB 55
HB 55 Testimony Packet 2.pdf SFIN 5/16/2022 9:00:00 AM
HB 55
HB 55 Testimony Packet 1.pdf SFIN 5/16/2022 9:00:00 AM
HB 55
HB 322 Sectional Analysis Version B.A 5.15.2022.pdf SFIN 5/16/2022 9:00:00 AM
HB 322
HB 322 Sponsor Statement 05.15.2022.pdf SFIN 5/16/2022 9:00:00 AM
HB 322