Legislature(2003 - 2004)
03/18/2003 03:31 PM Senate STA
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 115-CORRECTIONAL INDUSTRIES PROGRAM EXPENSES
CHAIR GARY STEVENS asked Mr. Burnett to introduce SB 115.
MR. JERRY BURNETT, Department of Corrections Director of
Administrative Services, explained the bill allows the
Correctional Industries Fund to pay state employee wages and
benefits for the product managers employed in correctional
industries. Effectively, $960,000 would be paid from product
revenues instead of from the general fund.
CHAIR GARY STEVENS asked what the current product revenue figure
was.
MR. BURNETT replied the estimate for FY04 is approximately
$4,150,000. If SB 115 passes, they would have to manage the fund
more aggressively in an effort to increase revenues.
CHAIR GARY STEVENS asked him to elaborate.
MR. BURNETT added they have product managers and correctional
inmates who are employees. Currently they run the Juneau
Commercial Laundry, Fairbanks Garment/Flat goods Shop, Kenai
Office Furniture Systems Plant, Eagle River Garment Shop, Kenai
Metals Plant, Seward Wood Furniture Plant, Palmer Auto Body
Shop, and Juneau Staph Guard Hospital Laundry.
SENATOR JOHN COWDERY asked if the purpose was to shift employee
costs from the general fund.
MR. BURNETT replied the salaries and benefits of all 14 product
managers associated with correctional industries are currently
paid from the general fund. This bill would allow their salaries
and benefits to be paid from correctional industries revenues.
SENATOR HOFFMAN asked if the salaries and benefits for those
positions would remain the same.
MR. BURNETT replied there is no proposal to change them.
SENATOR GUESS asked for the current revenues and expenditures.
MR. BURNETT advised current revenues for Fy04 are about
$4,150,000 and without any changes, they expect to have a fund
balance of about $300,000 at the end of this fiscal year.
Therefore, they would need to increase revenues to pay the
salaries and benefits.
SENATOR GUESS asked what would be eliminated if those revenues
don't increase.
MR. BURNETT said they would have to "find efficiencies within
the department to cover the costs."
SENATOR GUESS queried whether passing this bill would result in
positions being cut.
MR. BURNETT replied they did not plan to cut any positions as a
result of passing SB 115.
SENATOR GUESS questioned whether the salaries and benefits
discussed could be part of the reduction if the department is
unable to make up the more than $600,000 difference.
MR. BURNETT wasn't able to offer an answer regarding how the
department would handle reductions if they were unable to make
up the revenues.
SENATOR GUESS said she wasn't making herself clear. She wanted
to know if including salaries and benefits would make it an
option to exclude them in a reduction because they wouldn't be
excluded now.
MR. BURNETT replied salaries and benefits are currently paid
from the general fund and a general fund reduction to the
department could result in a cut to those positions.
SENATOR GUESS said she was talking about the Correctional
Industry Fund.
MR. BURNETT advised cutting positions would be one of their
options if the industry fund was unable to generate sufficient
revenues to pay for the salaries and benefits of its employees.
SENATOR GUESS asked, "But it wouldn't be right now if the
Correctional Industries Fund fell short. You couldn't actually
reduce salaries and benefits."
MR. BURNETT replied, "Currently, if correctional industries
revenues were to fall short, it is likely that we would reduce
the number of product managers we have even though it is not a
direct relationship to the general fund. We would because we
wouldn't have sufficient work and sufficient income to justify
those positions."
CHAIR GARY STEVENS commented the task isn't easy but the idea is
the program should pay its way.
MR. BURNETT agreed.
SENATOR HOFFMAN asked how they planned to generate the
additional revenue.
MR. BURNETT wasn't in a position to answer. The manager was
going to retire and the department would look for a new manager
with the entrepreneurial skills to actualize the goal.
SENATOR COWDERY asked what the money in the fund is used for
currently.
MR. BURNETT replied it is used to buy supplies and pay for
equipment and pay the salaries of the inmates who work in
correctional industries.
SENATOR COWDERY asked how much inmates are paid per hour.
MR. BURNETT wasn't sure, but thought they were paid in the
neighborhood of fifty cents per hour. Even so, they would need
significant new revenues.
SENATOR DYSON advised he has a continuing interest in
correctional industries. The capacity crisis in the state
prisons makes it very difficult to take advantage of training
and job opportunities. The prison population must become more
stable before meaningful training is possible. He sees no reason
why the auto body shop at Sutton couldn't one day become as
successful as the Nevada prison auto shop where inmates restore
antique and classic automobiles. The men and women trained in
that Nevada shop have few discipline problems and an extremely
low recidivism rate. Those inmates have a trade and typically
one or two job offers when they are released so they are able to
support themselves and their families.
SENATOR COWDERY asked whether Florence, Arizona inmates were
required to get a GED [General Educational Development] before
they could apply for a job while in prison.
SENATOR HOFFMAN recalled inmates were required to work toward a
GED before they could get TV privileges.
SENATOR COWDERY thought the idea was worthwhile.
CHAIR GARY STEVENS acknowledged that Mr. Burnett had his work
cut out for him, but this could provide a good opportunity for
everyone involved.
There was no further testimony.
CHAIR GARY STEVENS asked for a motion to move SB 115.
SENATOR DYSON made a motion to move SB 115 and attached fiscal
note from committee with individual recommendations. There being
no objection, it was so ordered.
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