Legislature(2001 - 2002)
04/18/2002 03:40 PM Senate STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 162-ABSENCES UNDER LONGEVITY BONUS PROGRAM
SENATOR THERRIAULT recapped the changes discussed during the
previous hearing on the bill. In Section 1 changing 30 days to 60
days would allow recipients to be gone from the state for a
longer period of time and still receive their check. That would
cost the system about $280,000.00.
He asked for an explanation of the savings.
REPRESENTATIVE GRETCHEN GUESS, bill sponsor, said the savings
comes from moving the unpaid leave from 90 days to five years.
CHAIRMAN THERRIAULT explained that these individuals would retain
their eligibility, but while they were gone from the state they
would not receive a check. Once they returned to the state they
could start receiving the check again. He asked how much that
would save.
REPRESENTATIVE GUESS replied that would save the state
$435,000.00.
CHAIRMAN THERRIAULT said he wanted all the savings, but didn't
want the expense. He spoke to Representative Guess about
splitting the difference and going from 30 days to 45 days, which
would cut the expense in half.
REPRESENTATIVE GUESS said Senator Halford expressed concern about
the five year term and she wasn't sure whether he wanted to
change that or not.
SENATOR HALFORD said the way the fiscal note reads, the bill
saves $147,000.00 but the analysis says that the normal decline
in payments is the savings and the bill costs the state money.
Section 1 looks like it costs an additional $288,000.00.
REPRESENTATIVE GUESS agreed.
CHAIRMAN THERRIAULT said that is because people are allowed to
travel out of state for a longer period of time and retain their
check.
SENATOR HALFORD said he understood that. He questioned how
Section 2 is supposed to save $435,000.00.
REPRESENTATIVE GUESS said it's based on the assumption that
people will stay out of state longer and not return to the state
just to keep their eligibility. The decrease is how they
estimated FY03 into the future and keeping the same 10 percent
savings formula but knowing that the payments were decreasing.
There is a decrease in the savings because of the payment
decrease. The savings is a static formula but the payment goes
down 6.7 percent.
SENATOR STEVENS asked whether there was any relationship to the
fact that the program is diminishing each year.
SENATOR HALFORD said that's the cause. He wanted to make sure the
savings was an actual savings without regard to the amount it's
already going down.
REPRESENTATIVE GUESS said that is what the department has
testified to up to this point.
SENATOR HALFORD then asked how the five year return worked.
REPRESENTATIVE GUESS replied now it's 90 days. If someone is off
the role for 90 days, then they are removed completely. This
would change that timeframe to five years. The department set
this term so they could clean up their records.
Individuals may also apply for a one year sabbatical once every
five years.
SENATOR HALFORD said he was concerned about the fiscal
implication of people that have been gone up to five years and
wondered if they could come back and reenroll.
JAMES KOHN, Director of the Division of Alaska Longevity
Programs, said no one has been added to the bonus program since
December 31, 1996 making this a fixed group of people. Some
seniors want to go out of the state for a period of time that
exceeds 90 days in a row or 180 days in a year. However, they
feel they need a cutoff date after which they can be dropped from
the program. At a minimum, the term should be one year, but he
would prefer some time over two years. There are individuals that
go out on mission work and are gone for several years but they
will return because Alaska is their home. He would like to make
it possible for people to leave the state as they wish and that
would save the state money because they wouldn't be paying those
individuals the bonus.
SENATOR HALFORD said he is concerned about the people that have
made the decision to leave in the last four years and seven
months. Could they return and come back into the program and what
would the economic impact be?
MR. KOHN said if someone has been removed from a program under
present law, a change in the law would not allow him or her to
reapply to return to the program.
SENATOR HALFORD asked whether that was clear. He wanted to make
sure this is the case.
MR. KOHN thought there was language that said "from this date
forward." If that language isn't present, then it should be
inserted. It's a good idea to make that clear.
SENATOR HALFORD said he doesn't have as much difficulty going out
three years if it's prospective. He didn't want to open an
unintended window.
CHAIRMAN THERRIAULT asked how people could come back if under the
current program they're out if they've been gone 90 days.
MR. KOHN replied there are exemptive reasons for being gone.
Medical reasons and caring for a family member are such
exemptions.
CHAIRMAN THERRIAULT noted Ms. Walker's situation as testified to
during the previous hearing.
SENATOR HALFORD made a motion to adopt conceptual amendment 1 to
change the five year term to three years and request language
that makes it clear that it is prospective not retrospective.
There being no objection, amendment 1 was adopted.
CHAIRMAN THERRIAULT made a motion to adopt amendment 2 changing
"60 [30] days" to "45 [30] days" on page 1, line 6.
SENATOR HALFORD asked the age of the youngest people receiving
the bonus.
MR. KOHN said they had to be 65 in 1996 so they would be 73 to 74
years old and they would be in the $100.00 per month bracket. To
be receiving $250.00 per month you would have to be 76 to 77
years old.
CHAIRMAN THERRIAULT said part of his dilemma about dealing with
the program in general is the people that are receiving the bonus
that are newcomers to the state while people who lived in Alaska
since the 1940s didn't qualify because they missed the cut off
date.
REPRESENTATIVE GUESS said she would like to keep the 60 days but
she appreciates the committee process.
SENATOR DAVIS objected to proposed amendment 2.
CHAIRMAN THERRIAULT asked for a roll call vote on amendment 2.
The motion failed, three to one with Senators Davis, Stevens,
Halford voting no and Chairman Therriault voting yes.
SENATOR DAVIS made a motion to move SCS HB 162(STA) and attached
fiscal note from committee with individual recommendations.
There being no objection, it was so ordered.
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