Legislature(2001 - 2002)

04/05/2001 03:35 PM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  SB  34-COMMISSIONERS' SALARIES                                                                            
CHAIRMAN THERRIAULT  informed committee members that  the bill would                                                            
be heard but there would be no final action taken that day.                                                                     
MIKE ABBOTT,  legislative  director in the  Office of the  Governor,                                                            
was particularly  appreciative of  the hearing in light of  the fact                                                            
that legislation  putting in place  pay raises for public  officials                                                            
is not easy legislation.                                                                                                        
Pay ranges  for cabinet officers  are set  in statute with  no merit                                                            
increase  opportunities.   SB 34  would  change  that  and  make  it                                                            
possible for the  governor to set a range of $86,800  to $96,200 for                                                            
cabinet  level salaries.  Functionally, this  would provide  a range                                                            
from 28, step E to range  30, step F. The specific salary within the                                                            
range would be set at the discretion of the governor.                                                                           
Senator Halford joined the meeting.                                                                                             
MR. ABBOTT  said this is  the second legislature  in which  Governor                                                            
Knowles has introduced  this legislation. The justification  is that                                                            
the salaries  were set in  the current range  and step more  than 20                                                            
years  ago, in 1980.  Although  compensation for  the positions  has                                                            
gone up  as a result of  collective bargaining,  it has not  kept up                                                            
with  inflation.  If  the  1980  salaries   had  been  adjusted  for                                                            
inflation, they would be  approximately $46,000 higher now than they                                                            
were then.                                                                                                                      
There are many  state employees who make more than  their department                                                            
heads.  Last year,  more than 90  Department  of Transportation  and                                                            
Public  Facilities   (DOTPF)  employees   earned  more  than   their                                                            
commissioner.  In the Department of Law there are  50 employees with                                                            
a  higher  step  and   range  than  the  attorney  general.   It  is                                                            
appropriate  for commissioners to  make more that those individuals                                                             
working for them.                                                                                                               
Federal   salaries   for   positions   with   similar   duties   and                                                            
responsibilities  pay substantially  more. The salary for  the state                                                            
director of  the Bureau of Land Management  is between $110,000  and                                                            
$125,000  per  year  plus  25 percent  tax  exempt  cost  of  living                                                            
allowance (COLA); the administrator  for the federal highways office                                                            
makes somewhere between  $80,000 and $100,000 per year plus COLA and                                                            
the  director of  the National  Marine  Fisheries  Service makes  in                                                            
excess  of $100,000  per year  plus COLA.  There  is attrition  from                                                            
state ranks to  federal positions because state compensation  simply                                                            
is not competitive.                                                                                                             
Number 786                                                                                                                      
He  called  attention   to  correspondence  from  former   attorneys                                                            
general, former  commissioners of  commerce and labor and  chiefs of                                                            
staff  from previous  administrations  all  lending  support to  the                                                            
proposed  increase.  Compensation   offered  to  some  of  the  most                                                            
important   individuals  in   state  government   is,  in   fact,  a                                                            
disincentive to serve or remain in service.                                                                                     
CHAIRMAN THERRIAULT asked  for a repeat of the salary ranges and Mr.                                                            
Abbott obliged.                                                                                                                 
He asked  why the  range was  offered and  how it  would be  decided                                                            
which commissioners were  paid at the lower range and which would be                                                            
offered the top range.                                                                                                          
MR. ABBOTT said the governor's  rationale in suggesting the range is                                                            
to  give  the  chief   executive  the  opportunity   to  respond  to                                                            
excellence  and seniority of service.  Currently, the status  quo is                                                            
$86,000.  The  governor's  intent  is  to  review  the  service  and                                                            
performance  of the  existing cabinet  and would  make compensation                                                             
decisions on that  basis. It would be this governor's  intent to use                                                            
$86,000  as the base  but another  governor might  have a  different                                                            
SENATOR PHILLIPS  indicated a lack of sympathy for  the legislation.                                                            
He  said that  money  is part  of  it but  it  is a  public  service                                                            
position and those  individuals should be ready and  willing to give                                                            
to the state.                                                                                                                   
MR. ABBOTT didn't  disagree, but said it's a multifaceted  challenge                                                            
to encourage quality individuals  to relocate to Juneau and join the                                                            
cabinet. Clearly, public  service is the single greatest reason most                                                            
individuals  accept cabinet  positions.  Even at  the highest  level                                                            
requested, nearly  every one of the individuals is  taking a pay cut                                                            
from what  they could earn  in the private  sector. This bill  gives                                                            
the  governor  the  opportunity  to  reward  service  and  recognize                                                            
contributions  and  to provide  slightly  more competitive  pay  for                                                            
important state officials.                                                                                                      
CHAIRMAN  THERRIAULT said  he agrees with  the concept of  rewarding                                                            
excellence but he's unsure  that governors would offer commissioners                                                            
salaries  at   the  bottom  end  of   the  scale.  They   might  all                                                            
automatically start at the top.                                                                                                 
MR. ABBOTT  said the legislation was  written in the context  of the                                                            
current  administration  but if  it's  the committee's  pleasure  to                                                            
amend the  bill to require  starting at the  lower end of the  scale                                                            
that would be generally  consistent with Governor Knowles' intent in                                                            
promoting this legislation.                                                                                                     
SENATOR  DAVIS  asked   whether  all  commissioners   serving  under                                                            
Governor  Knowles were  hired  at the same  level  or whether  their                                                            
salaries were dependent upon the department they would head.                                                                    
MR.  ABBOTT  said they  were  all  paid the  same  as set  forth  in                                                            
SENATOR DAVIS  asked whether there  is any other way to raise  those                                                            
MR. ABBOTT read  from the statutes: "The monthly salary  of the head                                                            
of each  principle  executive  department of  the state  is step  E,                                                            
range 28."                                                                                                                      
SENATOR DAVIS  said she thought the salaries are low  and need to be                                                            
raised. She'd like to see  this legislation moved from committee, if                                                            
not today, at least soon.                                                                                                       
CHAIRMAN  THERRIAULT  said all  individuals  serving  now signed  on                                                            
knowing   about  the  statutory   language.   He  asked  about   the                                                            
administration's  position if  this became  effective with  the next                                                            
administration and not the current one.                                                                                         
MR. ABBOTT  said clearly there  is not a lot  of time left  for this                                                            
administration.  They proposed a retroactive  effective date  to the                                                            
beginning  of  the year  so,  if approved  and  funded,  the  salary                                                            
increase would be effective  January 1, 2001. Governor Knowles feels                                                            
strongly that  he would like to take  this opportunity to  recognize                                                            
and reward  individuals who  have served for  an extended period  of                                                            
time. It would  be a slap in the face  to those individuals  if they                                                            
were not given a raise while their successors were so rewarded.                                                                 
There  is  an amended  fiscal  note  that  although  not  large,  is                                                            
meaningful.  The  Governor   feels  very  strongly  that  it  is  an                                                            
opportunity that  should be available to the current  administration                                                            
as well as future ones.                                                                                                         
CHAIRMAN  THERRIAULT said the  fiscal note  he has is dated  2/26/01                                                            
for $78,100.                                                                                                                    
MR. ABBOTT  said  that is  the correct  one; February  reflects  the                                                            
amended note.                                                                                                                   
CHAIRMAN THERRIAULT  asked for questions  or other testimony.  There                                                            
was none.                                                                                                                       
He said the bill may come  up again under bills previously heard and                                                            
he will notify  Mr. Abbott if there is intent to do  so. If there is                                                            
a desire  to move  the bill  he would  talk about  changing  certain                                                            

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