12/12/1997 09:38 AM House BUD
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+ teleconferenced
= bill was previously heard/scheduled
MINUTES
ALASKA STATE LEGISLATURE
BUDGET AND AUDIT COMMITTEE
December 12, 1997
9:38 A.M.
Legislative Information Office
Anchorage, Alaska
Tape LBA 97 - 1, Side 1
Tape LBA 97 - 1, Side 2
Tape LBA 97 - 2, Side 1
Tape LBA 97 - 2, Side 2
Tape LBA 97 - 3, Side 1
CALL TO ORDER
Senator Randy Phillips convened the December 12, 1997,
meeting of the Legislative Budget and Audit Committee at
9:38 a.m. at the Fifth Floor Conference Room, Anchorage LIO,
Anchorage.
PRESENT
SENATORS REPRESENTATIVES
Sen. Phillips Rep. Hanley
Sen. Adams Rep. Croft
Sen. Donley Rep. James
Sen. Halford Rep. Therriault
Sen. Pearce
Representative Martin was not present for the meeting.
Members present by teleconference:
Sen. Torgerson Rep. Bunde
ALSO PRESENT
Mike Greany, Director, Division of Legislative Finance;
Kevin Brooks, Director, Division of Administrative Services,
Department of Fish and Game; Dan Spencer, (Testified via
Teleconference), Chief Budget Analyst, Office of Management
and Budget, Office of the Governor; Janet Clarke, Director,
Division of Administrative Services, Department of Health
and Social Services; Eric Myers, Exxon Valdez Trustee
Council; Jack Cushing, Mayor, City of Homer, Homer; John
Bitney, Alaska Housing Finance Corporation, Anchorage; Vicki
Williams, Alaska Housing Finance Division, Anchorage;
Cecilia LaCara, Deputy Director, Division of Child Support
Enforcement, Department of Revenue; Wendy Lyford, Court
Administrator, Superior Court, Alaska Court System,
Anchorage; Suzanne Goodrich, Executive Director, Catholic
Community Services, Eagle River; Margaret Kirkland,
Anchorage; Randy Super, (Testified via Teleconference),
Department of Health and Social Services, Juneau; Annalee
McConnell, (Testified via Teleconference), Director, Office
of Management and Budget, Office of the Governor, Juneau;
Theresa Tanoury, Special Assistant to Commissioner Perdue,
Department of Health and Social Services;
SUMMARY
Senator Phillips announced that the minutes from previous
meetings would be addressed in Juneau at the beginning of
the next legislative session.
REVISED PROGRAM REQUESTS
RPL 11-8-0189 Department of Fish and Game, Habitat
BRU, Special Projects Component and
Administration and Support BRU,
Administrative Services Component
$109,724 dollars in statutory designated receipts for review
of several industry development projects.
MIKE GREANY, DIRECTOR, DIVISION OF LEGISLATIVE FINANCE,
recommended approval of the RPL which would use statutory
designated receipts. He understood that to be the intent of
the Finance Committees when granting the agency authority to
seek funding during the interim.
Senator Adams MOVED to approve the above listed RPL. There
being NO OBJECTION, RPL 11-8-0189 was approved.
RPL 11-8-0190 Department of Fish and Game, Division of
Subsistence, Special Projects Component
$85,000 dollars in federal receipts for travel reimbursement
for the Yukon River Panel and Joint Technical Committee
meetings.
Mr. Greany noted that the Division of Legislative Finance
recommended approval of the proposed RPL, which was in line
with the Finance Committees legislative intent.
Senator Adams MOVED to approve the above listed RPL. There
being NO OBJECTION, RPL 11-8-0190 was approved.
RPL 11-8-0193 Department of Fish and Game, Commercial
Fisheries Management and Development
Division, Special Projects Component
$463,800 dollars in test fish receipts for an experimental
open platform herring fishery in Sitka Sound.
Mr. Greany noted that the RPL had not properly come before
the Legislative Budget and Audit Committee (LBA). He stated
that the Committee did not have the authority to act on it
and recommended "no action" be taken.
KEVIN BROOKS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF FISH AND GAME, responded that the Department
submitted the RPL as an opportunity to inform the LBA
Committee of a situation in Sitka regarding test fishery,
which must be addressed by mid March in order to contract
with the necessary vessels. He continued, the Department
should award the bid by the end of January, 1998. He
acknowledged that fish receipts had been included in SB 55,
although, not the statutory designed program receipts.
DAN SPENCER, (TESTIFIED VIA TELECONFERENCE), CHIEF BUDGET
ANALYST, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE
GOVERNOR, advised that the Office of Management and Budget
(OMB) was attempting to determine a way to educate Committee
members of the need.
Senator Adams agreed with the recommendation given with the
OMB Director, Annalee McConnell. He pointed out that within
SB 55, the program receipts authorization language was broad
enough, and that the approval of the proposed RPL should be
available to the LBA Committee. He reiterated, it was
authorized through SB 55. Additionally, the timing issue is
important for Sitka. He asked if the Department had further
test receipt authorization available at this time.
Mr. Brooks replied that the Commercial Fisheries Division
budget had $2.5 million dollars authorized for test fish
receipts in FY98. To date, the Department has used $1.1
million dollars of that budget. The remaining $1.4 million
dollars will be allocated to specific fisheries which will
occur during the remainder of the fiscal year.
Senator Adams asked which projects could be held until the
Legislature meets in Juneau in 1998, so that the remaining
$500 thousand dollars could be given authority during the
supplemental process. Mr. Brooks explained that December
was a slow month for test fisheries and that by spring the
Department would be in "full swing". Given the typical
supplemental bill approved in May, chances are, the
Department would have exceeded its authority by that time.
Mr. Spencer emphasized that "timing" is essential because
the fishery begins in middle March.
Mr. Greany reiterated that the concern was addressed in SB
55 with new fund sources created in that legislation. The
test fisheries were created as their own separate funding
source and were not enumerated upon in the front section of
the appropriation bill. He suggested that the Department
could qualify for other authorization for this need that
could be replaced through a supplemental appropriation.
Representative Therriault questioned if the funds were
granted would they be considered general fund expenditures
in the supplemental or would it be a creation of a new
funding source. Mr. Greany explained that the front section
of the general appropriation bill did not give the LBA
Committee the authority to deal with that funding source.
It would be a non-general fund source.
Senator Adams noted that if the request was approved, it
could provide for an additional supplemental bill with
another program use for those program receipts. Mr. Greany
explained that the manner in which the test fishery receipts
were appropriated was generic. They were available to the
Department to determine where they should be spent. He
advised that the Legislature should be specific in
determining how these funds are spent.
Mr. Spencer elaborated a major concern is that if the
Department uses this existing authority, all the funds could
be used prior to the Legislature passing a supplemental
funding.
Mr. Greany reiterated that the LBA Committee take "no
action" on the request, while at the same time, adopt a
motion to provide communication to the Finance Committees to
consider inclusion of intent in the early supplemental
appropriation bill. Senator Adams reiterated his concern
that Sitka might loose the opportunity to participate in the
herring fishery.
Representative James MOVED to adopt the recommendation
suggested by Mr. Greany. Senator Adams OBJECTED to the
MOTION, noting that it would delay the Sitka herring
fishery. Mr. Greany understood that the bid would need to
be submitted by early January.
Representative Hanley pointed out that the Department has
the flexibility to go forward with the proposal and that the
Department would go forward if they had the guarantee that
the matter would be considered in the Legislative Finance
Committees. Mr. Spencer agreed that if the LBA Committee
recommended that the matter would be considered in the
Legislative Finance Committees, the Department could then
address Sitka's situation.
Representative Therriault noted that he was not comfortable
automatically granting an increase to the test fisheries
budget through the Finance Committees. Mr. Spencer
recognized that the LBA Committee could not bind the Finance
Committees, although, asked that the LBA Committee urge the
Finance Committees to favorably recommend the proposal.
Senator Halford understood the recommendation was that the
Finance Committees would review the proposal for possible
inclusion for supplemental funding. Senator Adams believed
that format would delay the project. He asked if the
current motion would provide the Department, authorization
to continue with the bidding process for the test fishery in
Sitka. Mr. Spencer replied that the Department was
comfortable with the motion. Senator Adams WITHDREW his
OBJECTION. There being NO further OBJECTION, the MOTION was
PASSED as recommended by Mr. Greany.
RPL 01-8-8024 Office of the Governor, Office of
Management and Budget, Division of
Governmental Coordination
$195,000 dollars in federal receipts for the Alaska Coastal
Management Program.
Mr. Greany stated that the Legislative Finance Division
approved of the request for two purposes: To finalize the
most recent regulations and to support a consistency review
of the Prince William Sound vessel contingency plan.
Senator Adams MOVED to approve RPL 01-8-08024. There being
NO OBJECTION, it was adopted.
RPL 01-8-8025 Office of the Governor, Human Rights
Commission
$80,466 in federal receipts for investigation and public
hearings.
Mr. Greany noted that the Division of Legislative Finance
recommended approval of the federal funds. The funds would
be used for current legal cases and to update the State's
word processing standards.
Representative Croft MOVED to adopt RPL 01-8-8025. There
being NO OBJECTION, it was adopted.
RPL 06-8-0152 Department of Health and Social
Services, Medical Assistance BRU, Women,
Infants, and Children Component
$3,750,000 dollars in federal receipts for Medicaid coverage
for native clients.
Mr. Greany provided Committee members information addressing
the policy adopted by the Finance Committee and the LBA
Committee leadership to OMB, March, 1997. The handout
provides ground rule information on how RPL requests are to
be handled during the interim. He described language which
stipulates that the LBA action should be used to restore
budget reductions from a past session or for program
enhancements. Mr. Greany added, this policy was used when
reviewing requests submitted by the Department of Health and
Social Services.
Mr. Greany recommended that RPL 06-8-0152 be deferred to the
Legislative Finance Committees. Because of the appropriation
allocation structure within the Department of Health and
Social Services, a mixture of federal and state funds allows
the Department some latitude to transfer money within. He
stated that new money affecting the proposed RPL from the
State receiving money from services provided through the
education services would be subsequently reimbursed through
Medicaid. The Department is proposing to take these
additional monies to improve different activities. He
pointed out that the medical reimbursement funds are claims
for short terms and are interchangeable. Mr. Greany
recommended that the full Legislature should have the
opportunity to review these needs.
Senator Adams asked if Mr. Greany's concerns would be
satisfied if the federal receipts were used only for the
proposed request. Mr. Greany replied that regardless of
additional authority requested or approved, the Department
does have the ability to move funds around. He concluded
that there are policy issues involved in how the money
should be used.
JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES, commented that the
Department understood that there would be a lot of
discussion with the Medicaid budget because of the federal
match changes. The Department's intention in requesting the
proposed revised program was to inform Committee members of
the situation and initially, lay out the increased need for
Indian Health Service funds. She emphasized that the
Department's intent was not to circumvent the full
legislature. These requests are to a subsequent request to
a portion of the sole-based-claims that came into the State
with an aggressive matching need. Part of these receipts
are unrestricted federal funds which can be used for a
number of programs.
She continued, $1.3 million dollars of receipts of the $3.7
million dollar request will return to the Department of
Education. Part of the money has already been RSA'd to that
Department so that school districts can award grants while
the schools are still in session to establish programs.
Currently, there is $2 million dollars budgeted to the
Department for use in the school base claim. Based on
agreements with the federal government, that claim should
increase to $4.6 million dollars. Ms. Clarke agreed that
this was an involved situation. She added that the Indian
Health Service was 100% federally funded with Medicaid
dollars and has no match requirements from the State.
Representative Croft inquired if the LBA Committee had the
authority to address this request. Mr. Greany replied that
the Committee had the statutory authority to grant the
request, but that the Division of Legislative Finance did
not support the policy authority for the request. He
commented that the issues are intertwined. Representative
Croft pointed out that the Committee did have the statutory
authority to address issues of an emergency nature. He
urged the Committee to contemplate if the situation was an
"emergency" or not. Mr. Greany agreed.
Representative Croft pointed out that the money addressed in
the request is purely contractual funds and that there would
be no new state employees hired. Mr. Greany pointed out
that there are times when the State does not have the legal
obligation to continue a program, although, expectations are
created and difficult to change. He concluded that all needs
can not be funded.
Senator Pearce stated that the request does not fall into
the category of "emergency". She voiced frustration with
the Department and how confusing it was to determine
specific needs with the number of transfers occurring. She
MOVED to place RPL 06-8-0152, RPL 06-8-0155 and RPL 06-8-
0171, at the "bottom of the calendar".
Representative James added that this was a public policy
issue. She voiced hesitation in maximizing the use of
federal funding especially for schools. Representative
James stressed that the State has done this in the past and
it has created an administrative over-load. She urged that
the entire Legislature address the concern.
There being NO OBJECTION, Senator Pearce's MOTION to move
the RPL's to the "bottom of the calendar" was adopted.
RPL 06-8-0154 Department of Health and Social
Services, State Health Services BRU,
Women, Infants, and Children Component
$1,000,000 dollars in statutory designated program receipts
to cover the anticipated increase in the infant formula
rebate contract with private industry.
Mr. Greany noted that the Division of Legislative Finance
recommended approval of the request. The funds are part of
the statutory designated receipt category.
Senator Pearce MOVED to approve the above listed RPL. There
being NO OBJECTION, RPL 06-8-0154 was APPROVED.
RPL 09-8-0039 Department of Military and Veterans
Affairs, Division of Emergency Services
$25,000 dollars in federal receipts for a grant from the
National Earthquake Hazards Reeducation Program to conduct a
regional earthquake/tsunami conference.
Mr. Greany stated that that the Division of Legislative
Finance recommended approval of the request. The source of
federal funds is Federal Emergency Management Agency (FEMA).
Representative Hanley MOVED to approve the above listed RPL.
There being NO OBJECTION, RPL 09-8-0039 was APPROVED.
RPL 10-8-4016 Department of Natural Resources,
Resources Development, Pipeline
Coordinator
$296,865 dollars in statutory designated program receipts to
process applications for pipeline right-of-way leases for
the proposed Liberty Island sales oil pipeline and utility
oil pipeline.
Mr. Greany recommended that the RPL be approved.
Representative James MOVED to approve the above listed RPL.
There being NO OBJECTION, RPL 09-8-0039 was APPROVED.
RPL 10-8-4018 Department of Natural Resources,
Management and Administration, Trustee
Council Projects
$996,100 dollars in Exxon Valdez oil spill settlement funds
for the acquisition of land located within the City of
Homer.
Mr. Greany noted that the Division of Legislative Finance
recommended approval of the request for land acquisition.
Senator Pearce asked if the plans were threatened by other
usage.
(Tape Change 97-1, Side 2).
ERIC MYERS, EXXON VALDEZ TRUSTEE COUNCIL, ANCHORAGE,
explained that the lands had been proposed to the Trustee
Council for consideration resulting from discussions
regarding public lands and possible use options. The
options will expire the beginning of next year. He added,
there is pressure on the Homer Spit and the City of Homer to
get this process rolling. The program would provide an
opportunity for various landowners to work on a voluntary
basis with the City of Homer.
Senator Torgerson pointed out that the property was a first
parcel purchase by Exxon Valdez to be turned over to a local
government. He did not know of a competing interest for
development, and recommended approval of the measure.
Senator Adams MOVED to approve the above mentioned RPL.
Senator Pearce OBJECTED. Senator Halford asked what would
happen if the decision was held until the full Legislative
session.
Mr. Myers replied that the trust for public land established
a package of land, involving multiple landowners, with the
support of local government. There exists an opportunity
resulting from these efforts to purchase the land
collectively under the proposal. The options will expire as
early as January, 1998. At the point the options expire,
there will be no clear opportunity to put the package back
together.
Representative Therriault asked if currently there were
competing buyers or was it feared that the price would
increase. Mr. Myers acknowledged there was fear that the
price would increase. He added, there are pressures that
the shoreline could be developed. If the option does
expire, it is assumed that the price will increase.
Senator Pearce suggested that since the area was all
wetlands, the chances of development were slim. She
questioned what the trust would be restoring, enhancing or
rehabilitating in that area. Mr. Myers pointed out that
since the program's inception, there had been three hundred
land nominations in the area of properties. Only a small
fraction (10%) of those lands was of interest to the
Council. He stressed that these lands had fair market
appraisals.
JACK CUSHING, MAYOR, CITY OF HOMER, HOMER, commented that
these lands are very threatened by purchasers. There has
never been a core permit denied on that side of the Spit.
This popular program has been in the making for ten years.
Zoning has remained the same. Land owners have been
encouraged to participate for the "over-all" good of the
City of Homer as land is one of the biggest tourist draws in
that area and it needs to be preserved for the economic
development of that growth industry.
Senator Halford asked what would occur if nothing was
addressed for sixty days when the entire Legislature could
consider it. Mayor Cushing understood that the options
would begin to expire, which would then complicate matters.
Mr. Myers added that the Spit package involves four
contiguous parcels, each of which has one or more owners.
Bringing that amount of people to the table at the same time
took a tremendous amount of energy. Each arrangement
consists of individual options that the trust had to
establish which begins to expire in January, 1998.
Representative Croft emphasized that this area is threatened
and that money had been set-aside for this purpose. He
added, the Chamber of Commerce in Homer, their local senator
and the municipal body supported the proposal. The people
in that area want this land to be used for this practice.
He reechoed support for the purchase.
Senator Pearce questioned why the Trustee Council had not
requested an option which would extend time into the next
legislative session. She voiced her frustration with the
way in which the Council was running this business. She
pointed out that the process had been in the making for the
last ten years and questioned why the expediential rush
given the merits of the program. She recommended that it
was time for the full Legislature to look at the overall
purchasing of the Trustee Council as she stressed the impact
to that land.
Mayor Cushing replied that this has been a 10-year
comprehensive plan. A land-use and comprehensive plan is
not a land ordinance. It was not until the funds became
available that there was a qualification. The six votes
from the Trustee Council had to be determined. The Trustee
Council had concerns regarding the comprehensive package.
The City of Homer was not sure that they had the six votes
from that entity until it was worked out to a comfortable
level for all those involved.
Mayor Cushing added that the City of Homer had added sixty
acres of land to each side of the Spit parcels. That action
required incredible deliberation. He assured the Committee
that this was a classic real estate transaction, taking
advantage of an opportunity which exists right now.
Representative James believed the issue was too big to
address in the LBA Committee.
Mr. Myers noted that the terms of the options were not
negotiated by the Trustee Council or the Restoration Office.
They were negotiated by a private entity on behalf of the
City of Homer. Those options expire in January, 1998. He
feared that if the time limit is exceeded, the compromise
will not be reestablished.
Representative James MOVED to adopt RPL 10-8-4018. Senator
Adams OBJECTED, pointing out that he made the motion before
Representative James. Senator Adams MOVED to approve this
RPL. He stated that in the past the LBA Committee has
approved similar motions and that the requested amount was
"peanuts" for the Committee.
A roll call vote was taken on the MOTION to adopt RPL 10-8-
4018.
IN FAVOR: Adams, Torgerson, Croft, Therriault
OPPOSED: Phillips, Halford, Pearce, James, Hanley
Senator Donley, Representative Martin, and Representative
Bunde were not present for the vote.
The MOTION FAILED (4-5).
Senator Adams requested that the Trustee Council get back to
the LBA Committee and let them know when the options run
out. If the options do not run out by January 12, 1998,
another LBA Committee meeting is scheduled at that time and
it can be readdressed then.
RPL 10-8-4022 Department of Natural Resources,
Agricultural Development, Agricultural
Development
$50,000 in federal receipts from the U.S. Department of
Agriculture for agricultural marketing.
Mr. Greany noted that the Division of Legislative Finance
did recommend approval of the request, which is in line with
the agricultural marketing efforts.
Representative James MOVED to approve the above listed RPL.
There being NO OBJECTION, RPL 10-8-4022 was APPROVED.
RPL 10-8-4023 Department of Natural Resources,
Agricultural Development, Agricultural
Development
$18,300 dollars in federal receipts from the Conservation
Reserve Program for the maintenance of agricultural parcels
now owned by the State.
Mr. Greany noted that the Legislative Finance Division
recommended approval of the request to be directed for the
use of agricultural parcels before they are foreclosed.
Senator Halford asked what would happen to CRP contracts
when the State repossesses a piece of property. He believed
that the incomes on the repossessed property could provide a
way for agriculture to pay its own way. Mr. Greany
understood that the money was the revenue generated on the
estimated resale of the properties. He acknowledged that
there was value to the CRP contracts.
Representative James MOVED to approve the above listed RPL.
There being NO OBJECTION, RPL 10-8-4023 was APPROVED.
RPL 10-8-4024 Department of Natural Resources,
Agricultural Development, Agricultural
Development
$6,500 dollars in federal receipts from the Agricultural
Market Transition Act Program for the maintenance of
agricultural parcels now owned by the State.
Mr. Greany noted that the Division of Legislative Finance
recommended approval of the above mentioned RPL, federal
monies to enhance agricultural efforts.
Representative James MOVED to approve the above mentioned
RPL. There being NO OBJECTION, RPL 10-8-4024 was APPROVED.
RPL 10-8-4025 Department of Natural Resources,
Agricultural Development, North Latitude
Plant Material Center
$27,000 dollars in statutory designated program receipts to
accomplish additional work on the contract with the
Anchorage Water & Wastewater Utility for the revegitation
requirements of the Anchorage Loop Water Transmission Main
project.
Mr. Greany noted that the Division of Legislative Finance
supported the proposed RPL.
Representative James MOVED to approve RPL 10-8-4025. There
being NO OBJECTION, it was so APPROVED.
RPL 12-8-0071 Department of Public Safety, Alaska
State Troopers, Narcotics Task Force
$325,900 dollars in federal receipts for continuation of the
Narcotics Task Force Program.
Mr. Greany commented that the Division of Legislative
Finance would recommend that the request be approved. Much
of the money will be used to reimburse claims by the local
jurisdictions involved in the narcotic efforts. In order to
make the grants available, the full authority must be
authorized.
Representative Hanley MOVED to approve RPL 12-8-0071. There
being NO OBJECTION, it was APPROVED.
RPL 4-8-0009 CIP-Department of Revenue, Alaska
Housing Finance Corporation, Public
Housing CIP
$240,000 dollars in AHFC corporate receipts to closeout the
Cedar Park reconstruction project. (This RPL falls under
the FY95 guidelines for Legislative Budget and Audit
Committee review similar to RPL 04-7-0032 for the Department
of Revenue which was approved under the FY97 guidelines at
the August 21, 1997 meeting).
Mr. Greany explained that the request was for the approval
of additional corporate receipts. The general appropriation
of the bill would not provide the Committee authority to
deal with corporate receipts for FY98 appropriations. He
pointed out that this is a capital project which was enacted
by the 1994 Legislative Session. The authority of the
project has not lapsed; it needs authority to increase
corporate receipts. He believed that the Committee did have
the legal authority to act on the above mentioned RPL. The
Legislative Finance Division recommends that if the LBA
Committee acknowledges the urgency to act upon the measure,
that they would have the legal authority to do that.
Senator Adams MOVED to approve RPL 4-8-0009. He noted that
Cedar Park has been worked on for years and believed that it
would be to the State's advantage to have it approved and
finished.
Representative Hanley questioned the emergency need time
line.
JOHN BITNEY, CONSTRUCTION PROJECT DIRECTOR, ALASKA HOUSING
FINANCE CORPORATION, ANCHORAGE, explained that the project
was being closed-out and that the contractor needed to be
paid off. Unpaid claims accrue interest at 10.5% interest.
The final amount settled with the contractor is $32,000
dollars higher than the initial request.
Senator Adams questioned recovering a portion of the money
from the architect. Mr. Bitney responded that the architect
acknowledged that a mistake had been made which lead to a
claim; AHFC is in the process of going forward with the
claims. At this point, the architect has made an offer of
$150,000 dollars, AHFC rejected that offer. The total
amount that AHFC will seek from that claim should be closer
to $500,000 dollars.
VICKI WILLIAMS, ALASKA HOUSING FINANCE DIVISION, ANCHORAGE,
noted that AHFC has a good chance of recovering that money.
Each claim cost will be analyzed. There is substantial
evidence indicating problems.
Senator Adams questioned how the additional $32,000 dollars
would be recovered for the contractor and the interest
resulting from lack of payment. Mr. Bitney stated that AHFC
would pay the claim rather than let it accrue interest. He
added that AHFC is requesting the authority to do that at
this time so that the claim does not accrue interest.
Representative Therriault asked if there existed any other
authority from which to pay the claim. Mr. Bitney replied
that AHFC could take money from an appropriation to pay the
accounts, however, claims are sought against the
architectural firm which made the mistakes leading to the
additional costs on the projects. AHFC is requesting
authority on part of those claims to pay off the contractor.
If payment was delayed, another project would be interrupted
and then there would be a need to seek a supplemental down
the road to capture the needed funds.
Mr. Greany noted that this was a specific capital project
being addressed. Unless the agency had capital projects
encompassing a broader title to allow the use of these
funds, then this is the only one being addressed at this
time. He pointed out that the revised request would bring
the amount to $272,099 dollars.
There being NO OBJECTION to the motion to approve, RPL 4-8-
0009 was ADOPTED.
RPL 04-8-0010 Department of Revenue, Child Support
Enforcement
$50,000 dollars in federal receipts for programs to
facilitate non-custodial parents' access to and visitation
of their children.
Mr. Greany explained that the funds would be used by the
Child Support Enforcement Division (CSED) and will go to the
Alaska Court System to reimburse a service agreement. Those
funds will be spent on mediation services for child support
effort.
Senator Adams MOVED to approve RPL 04-8-0010.
Representative Therriault asked if the mediation would be
used at the time custody was decided.
CECILIA LACARA, DEPUTY DIRECTOR, DIVISION OF CHILD SUPPORT
ENFORCEMENT, DEPARTMENT OF REVENUE, suggested that the Court
System could better answer that question.
WENDY LYFORD, AREA COURT ADMINISTRATOR, SUPERIOR COURT,
ALASKA COURT SYSTEM, ANCHORAGE, explained that the Court
System would envision having the mediator available in any
court decision involving minor children where custody was an
issue.
There being NO OBJECTION, RPL 04-8-0010 was APPROVED.
RPL 25-8-1058 Department of Transportation and Public
Facilities, Division of Weights and
Measures
$30,000 dollars in federal receipts for development of
strategic, intelligent transportation system/commercial
vehicle operations, business plan and for participation in
State and multi-State forms.
Mr. Greany explained that the Division of Legislative
Finance would recommend approval of the requested RPL.
Representative James MOVED approval of RPL 25-8-1058. There
being NO OBJECTION, it was APPROVED.
RPL 41-8-0031 Alaska Court System
$41,700 dollars in federal receipts for a project to reduce
barriers faced by Native Americans who must have contact
with the Court System.
Mr. Greany noted that the Division of Legislative Finance
supported approval of the above mentioned RPL.
Representative James MOVED to approve RPL 41-8-0031. There
being NO OBJECTION, it was APPROVED.
RPL 06-8-0152 Department of Health and Social
Services, Medical Assistance BRU, Indian
Health Service Component
$3,750,000 dollars in federal receipts for Medicaid coverage
for native clients.
RPL 06-8-0155 Department of Health and Social
Services, Public Assistance
Administration BRU, Child Care Benefits
Component
$875,000 in federal receipts for welfare to work
transitional child care assistance.
RPL 06-8-0171 Department of Health and Social
Services, Medicaid State Programs
$1,300,000 dollars in federal receipts available through the
Medicaid school-based claim program to be used to address
the backlog of children waiting for adoption.
Representative Hanley commented that all requests from the
Department should be addressed as a package. He requested
more information regarding the appropriation. He pointed
out that the request would provide an appropriation beyond
the current year. He questioned the extended levels of
funding which would move out of the request and increase
Medicaid applications.
(Tape Change LBA 97-2, Side 1).
Representative Hanley spoke to the magnitude of the proposal
noting the multiple changes proposed to the Medicaid
program.
Senator Adams voiced concern with all the programs which
would be discontinued without passage of the proposed
package. He recommended that each program be analyzed on an
individual basis.
SUZANNE GOODRICH, EXECUTIVE DIRECTOR, CATHOLIC SOCIAL
SERVICES (CSS), EAGLE RIVER, spoke to RPL 06-8-0171. She
explained that Catholic Social Services, which is part of a
national program, shares the cost of finding adoptive homes
for children. This service is a strong advocate for the
Adoption Reform Bill at the congressional level. CSS has
been in close contact with the Department of Health and
Human Services requesting response for the urgent need of
children for adoptive families. In consideration of the
children, she urged Committee members to consider and
support of this RPL. Ms. Goodrich stressed that this is an
urgent matter.
MARGARET KIRKLAND, ANCHORAGE, spoke to Committee members of
her own trauma of being a foster child for many of years,
and the power of the Committee to help alleviate that fate
for the children today.
RANDY SUPER, (TESTIFIED VIA TELECONFRENCE), DEPARTMENT OF
HEALTH AND SOCIAL SERVCIES, offered to answer questions of
Committee members regarding the technicalities of the school
administrative training. He pointed out that the
Legislature has discussed the policy level of identification
of use of the funds. Mr. Super noted that the initial
request to the federal government was $2 million dollars.
Through subsequent negotiations, it was increased. He
listed the priorities the Department has for the use of
funds in the adoption program. The funds would additionally
be used as grants to the school districts. If the proposal
is delayed for legislative consideration, the availability
of the funds not being released until May, would make it
difficult to effectively spend for specific purposes.
Mr. Super stressed that the costs could be used to
accommodate clients this year, as funds are available. The
Department is attempting to manage the program, while
meeting the needs as the dynamic health care environment
changes.
Ms. Clarke stressed that there are three separate RPL's
being proposed by the Department. She stressed that each
one is individual and distinct within itself.
She advised that the Department would not be able to
complete the work in addressing the backlog of 400 children
in a six-month period. Consequently, the Department has
requested the LBA Committee to extend the lapse date for
those special identified children.
Senator Phillips pointed out that the RPL was not received
by his office until one-week prior and was concerned with
the way in which it was presented. He added that the
Legislative Finance Division had recommended that the
consideration be deferred until the upcoming legislative
session.
ANNALEE MCCONNELL, (TESTIFIED VIA TELECONFERENCE), DIRECTOR,
OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR,
JUNEAU, apologized to Senator Phillips that the RPL had not
been faxed earlier. She reiterated that the Department is
trying to use this one-time federal money to deal with the
backlog. The Department believes that the opportunity is
present for the LBA Committee to make it possible for
private agencies to move children through the system in
order that they can be placed into permanent homes.
Senator Pearce commented that she had seen the backlog list
and noted her sympathy for those children, although, she was
not willing to support an RPL which would create a "vacuum".
She asked if there was any money in the current budget for
home study. She did not understand how RSA'd funds could
fix the problem. Senator Pearce questioned if this funding
would be a guarantee that the 400 children would receive the
funds rather than they being distributed to "other" needs
within the Administration.
Ms. Clarke explained that the Department currently spends
funds on adoption through subsidization. She added, little
money is spent on home studies. At this point, the
Commissioner of the Department has identified that spending
money on the proposed issue is the highest priority and best
used of those funds.
Ms. Clarke continued, the Court System intends to bring a
retired judge back to service to deal with these kind of
cases. If the Court System should need more money, the
Department would try to reallocate within other agencies.
Representative James voiced her opposition to the
proposition RPL 06-8-0152 and RPL 06-8-06-8-0171. She noted
that to place money into an existing policy would be
difficult. This condition arises because the State has not
had a policy which moves easily through the system. She
feared placing additional funds into the pot without making
some policy or statutory changes and that the extra funds
would not solve the overall problems.
Representative Croft voiced his support for the funding. He
commented that this was an innovative response to an
emergency situation as requested by the Legislature. The
Department came through as requested, and now response is
being delayed. He stressed that this was an appropriate
response to an emergency situation which does not use
general funds and does not hire additional state employees.
He warned that by re-studying the situation, 400 children
would be placed at risk once again.
Senator Adams noted that federal funds are always
accompanied with policies and guidelines for qualification.
He supported giving the Administration as many tools as
possible to help get children out of foster care and into
loving homes.
Senator Phillips asked Senator Pearce's opinion regarding
the best way to address the concerns of the three RPL's.
Senator Pearce recommended that a motion be made to address
each concern separately. She voiced discomfort making large
decisions and transfers of programs within departments
without the Finance Committees participating in that
decision. She added, she was comfortable with transfers to
the childcare component which she understood would help
address the waiting list.
Senator Adams MOVED to approve RPL 06-8-0152. Senator
Pearce OBJECTED. Representative Therriault asked for
clarification of the request. Ms. Clarke replied that RPL
0152 would address the portion of the school-based claims
which would go back to the Department of Education.
Representative James questioned the administrative burden
that this would place on the school districts. Ms. Clarke
clarified that the funds would not direct the schools to do
more work. The schools have agreed to do a time study based
on an administrative check sheet. To continue that
administrative burden, the Department has agreed to
contribute half the amount back to the school district.
Representative James was not convinced that the school
system would want this responsibility placed on their backs.
Representative Croft pointed out that the State is now
serving Medicaid students and deserves to receive that
money, suggesting that every avenue be pursued for
reimbursement.
In response to Representative James' concern, Ms. McConnell
noted that the State was not mandating that every school
provides a time study. It would be provided on a voluntary
basis. The districts are then reimbursed for their time and
energy. Ms. McConnell concluded that this would not be an
unfounded mandate.
A roll call vote was taken on the motion.
IN FAVOR: Adams, Croft, Therriault
OPPOSED: Phillips, Donley, Pearce, Torgerson,
Bunde
Senator Halford, Representative Martin, Representative James
and Representative Hanley were not present for the vote.
The MOTION FAILED (3-5).
Senator Adams MOVED to approve RPL 06-8-0155. There being
NO OBJECTION, it was so ordered.
Senator Adams MOVED to approve RPL 06-8-0171. Senator
Pearce OBJECTED. She asked if the Department planned to
offer a supplemental request in any budget area. Ms. Clarke
replied that the Department is attempting to avoid
supplemental requesting, particularly in the Medicaid area.
Although, there are intricacies in the Legislature front
section contingency language which will require supplemental
language.
Ms. McConnell agreed that there are some technical issues
which need to be addressed for the federal Medicaid rate
change. Federal matching had not been under consideration
by Congress when the budget was being passed. She noted
that the Department would want to handle this consideration
in a spring supplemental. She emphasized that the backlog
of children must be addressed.
Senator Pearce understood that these funds could be used for
anything. She pointed out that they were unrestricted
general funds, given the highest priority of the Department.
She recommended that if there is going to be a supplemental,
the $1.3 million dollars should be used toward those
concerns with a new program brought before the full
Legislator in January. She reiterated her concern regarding
the 400 foster children.
Representative Therriault questioned the Court System's
involvement and probability of hiring retired judges to
address these concerns.
Representative Croft acknowledged the frustration of those
involved in government to do what everyone knows need to be
accomplished.
(Tape Change, LBA 97-2, Side 2).
Representative Croft urged members to consider if this is an
appropriate proposal and problem. He believed that retired
judges would be willing to consider such a position.
Mr. Greany listed options to approve the concerns. The
obvious option would be to approve the request as presented.
Another option would be to defer the request in order that
the Finance Committees could consider it. The Committees
could determine if it was a worthwhile idea and then address
it by giving LBA an indication to approve the RPL
expeditiously.
Senator Pearce inquired the amount of money which could
reasonably be spent in a ninety-day period on the concern.
Ms. Clarke replied that cash flow analysis had not yet been
performed and that problems arise when the State partners
with a non-profit agency. She believed that the Department
of Law and the Alaska Court System would require a quick RSA
for the amount obligated. She agreed that all the funds
could not be spent in six months and that probably eighteen
months would be needed to adequately address the concern.
Ms. McConnell added, the approach was determined by
referencing the entire list of children to decide what would
be needed for the "total" home study as opposed to caring
for only some of the children.
Representative Therriualt questioned the idea of an
eighteen-month proposal. He questioned why the LBA
Committee should make a decision to amend the current year
fiscal plan and the following year's plan. Ms. Clarke
recognized that it would take the full Legislature to extend
the program to the entire eighteen months.
Ms. McConnell acknowledged that the Administration
recognized that LBA does have the authority to make
decisions in the interim particularly when there are
unanticipated federal funds available. She reiterated that
these are one-time funds and only the FY98 portion was being
addressed in the request.
Representative Therriault indicated that most often a grant
is used for a specific purpose. Representative Croft
requested more information on the categories listed.
THERESA TANOURY, SPECIAL ASSISTANT TO COMMISSIONER PERDUE,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke to the code
for special needs as listed on number #4 (direct recognized
risk with physical or mental needs) and #9 (court delay).
The departmental adoption specialists determined that any
additional money would go to the courts to speed up the
hearing process for each child and to more experientially
match a home with a child.
Ms. Goodrich reiterated that at Catholic Social Services,
there are ten families ready to adopt children.
Representative Therriault noted the frustration in the
Fairbanks area with the Foster Care Review Panel and it's
funding make-up. He recommended that funding be given to
these types groups. Representative Therriault believed that
to obligate the entire funds to the Division of Family and
Youth Services (DFYS) would not be beneficial.
Senator Donley voiced concern that the LBA Committee was
being requested to obligate the entire funding for the
eighteen-month period. He asked to see the money used for
its best use and not just what the Executive Branch assumed
necessary. Ms. Goodrich replied that all the groups
involved understand that there are fiscal considerations to
be addressed. The quicker the children are moved through
the system, the less the cost to the State and the less
emotional cost to the child. She pointed out, it is
important to understand that foster homes are only one part
of the entire system. The sooner the child is moved from
foster care to adoptive homes, more space is freed up for
new children entering into the program. She urged member's
favorable consideration of the requested RPL.
Senator Halford questioned the effect of approving only one
third of the request. Mr. Greany replied that the Committee
had the authority to make such a move. He warned that the
membership must consider the "severability" concern. Mr.
Greany pointed out that are 400 children who would be at
stake. Providing only one-third would make it be difficult
to identify the effectiveness of dealing with the list and
the program.
Ms. Clarke added that the Department is currently
undertaking on-going planning addressing the adoption aspect
of the program. The money is not to go to planning. The
list identifies over 100 children who are legally free to go
to adoption. Some of the technicalities of getting them
placed have to do with home studies. She stressed that for
this RPL, the Department has done a tremendous amount of
research in identifying the individual circumstances of the
children through working with tribal organizations. She
emphasized that the Department has worked diligently to come
up with an innovative proposal to address certain needs.
Ms. Clarke repeated that this is an urgent situation.
Senator Adams asked if one third of the funding was granted
how long would the Department be able to draw upon those
funds before requiring the additional monies.
Ms. McConnell replied that obviously, the Administration
would prefer to help some children rather than no children,
but would prefer to move immediately to help as many
children as possible. She believed that this Committee
would want to see that each child be placed. The question
is when they can be placed.
Senator Halford stated that it was unconscionable for the
Administration to come to the LBA Committee with an
eighteen-month program, thirty days before the Legislature
was to commence. He noted that he supported the intent and
added that he would like to see a partial component which
could get it started before the Legislature begins,
although, he was not willing to use the LBA Committee to
circumvent the entire Legislative process.
Senator Pearce commented that it was "not good" that the
Legislature had not been previously informed about the
number of children waiting and available for placement.
She questioned if money should be used to establish an
entire new program one-month before session begins. Senator
Pearce asked if it was common in other states that the state
be responsible to pick up the cost for the home study or
should the adoptive parents be responsible for those
services rendered.
Ms. Clarke explained that the program was based on a model
used in the State of Oregon for those children in state
custody. Ms. Tanoury added, situations vary because many
times a multiple of home studies must be done to match the
child to right family. Sometimes families come prepared to
pay, although, often times they are not able to. The
funding would allow our State to move quickly on the home
study aspect.
Senator Halford MOVED TO AMEND the original motion to one
third (1/3) the amount requested.
A roll call vote was taken on the motion.
IN FAVOR: Phillips, Adams, Donley, Halford,
Torgerson, Bunde, Croft, Therriault
OPPOSED: 0
Senator Pearce, Representative Martin, Representative James
and Representative Hanley were not present for the vote.
The MOTION PASSED (8-0).
Senator Donley recommended that particular interest be
placed to the RSA's to the Department of Law billing
purposes. He emphasized that the money be used for the
appropriate services for specific purposes.
Representative Croft asked how the Department of Law would
be allocated the funds or if they would be granted on a
contractual basis. Ms. Clarke replied that the Department
of Law has indicated that they would use contract attorneys
to do the work.
Senator Phillips asked if there were objections to the
amended RPL 06-8-0171. There being NO OBJECTIONS, the
amended to one-third the full amount RPL was APPROVED.
45 DAY RULE DISCUSSION
Mr. Greany stated that this was entire list of RPL's to come
before the Committee for action. He spoke to the 45-day
rule which stipulates that if the Committee turns down a
RPL, the Governor can legally proceed with it 45 days later
as that money would have been appropriated in the front
section of the general appropriations bill. Mr. Greany
understood that the LBA Committee was looking for ways in
which to address this concern.
Mr. Greany explained, following discussion with Tamara Cook,
Director, Alaska Legal Services, it was concluded that,
Option #2, extending the waiting period from 45 days to a
time placing it into a specified time of the next session,
would hold the most merit. That option would give the
Legislature the opportunity to "dis" appropriate the funding
approval. All options would require legislation which could
result in litigation. He recommended Option #2, which the
Legislature could address statutorily and could stand a good
chance in a legal challenge.
Senator Donley MOVED that the Chair of the Committee request
legislation which adopts Option #2. Senator Adams OBJECTED.
He questioned who controls the agenda as put before the LBA
Committee. Mr. Greany understood that the Office of
Management and Budget (OMB) controls the agenda of the LBA
Committee.
Representative Croft stated that Option #2 was
unconstitutional under the statutory code. Mr. Greany
pointed out that there was an attached legal analysis
provided by Legal Services discussing possible legal
challenges and separation of powers. He suggested that this
issue be reviewed during the session.
Senator Halford asked for clarification, suggesting that if
the front section were not included in the budget, if the
Legislature would be on sound ground assuming that the
Governor could not spend those monies. Mr. Greany agreed,
pointing out that would correspond with Option #3. Senator
Halford commented that in every other option, the Governor
could veto. He reiterated that the only choice "of
strength" for the Legislature would be to change the
appropriation in the front section. Mr. Greany added that
Option #3 would put the LBA Committee "out of business" as
far as the ability to be involved in additional expenditure
authority. Senator Halford noted that unless the
Legislature is willing to implement that, the Governor would
never go along with a change to his authority.
(Tape Change LBA 97-3, Side 1).
Senator Halford and Mr. Greany continued discussion on
options to the 45-day rule.
Representative Therriault suggested that the Committee
"hold-off" on action regarding a decision.
Senator Pearce applauded the LBA Committee for encouraging
the Finance Committees to look at the questions of
additional spending through the bigger picture.
Senator Phillips advised that given the Committee reviewal
of the list, when the following Legislative Session
commences in January, the Committee meet to discuss these
options.
Senator Donley WITHDREW the MOTION to adopt Option #2.
There being NO OBJECTION, it was APPROVED.
EXECUTIVE SESSION
Senator Pearce MOVED that the Committee meet in EXECUTIVE
SESSION for the purpose of consideration of audits and other
items related to the Committee's finances. There being NO
OBJECTION, the Committee met in EXECUTIVE SESSION.
REGULAR SESSION
The Committee reconvened in REGULAR SESSION.
Senator Pearce MOVED to move the Department of Fish and
Game's audit to that Department for response. There being
NO OBJECTION, it was APPROVED.
Senator Pearce MOVED to direct audit staff to depose
university personnel. There being NO OBJECTION, it was
APPROVED.
SPECIAL AUDIT REQUESTS
Senator Donley MOVED to approve all the audit requests
except those of Senator Taylor and Representative Hanley.
There being NO OBJECTION, it was APPROVED.
Senator Phillips noted that both he and Representative
Hanley would request that priority be given on the audit for
work to be completed by March, 1998. Senator Donley asked
that LBA stress that Representative Hanley's request be
moved to the top priority of the auditor's work.
Senator Pearce requested a copy of the list of backlogged
projects. Senator Phillips commented that the McDowell
report would be available on January 30, 1998.
Senator Phillips asked to create a committee for the
selection of Director for the Legislator Audit Division.
Committee volunteers were: Senator Halford, Senator Pearce,
Senator Adams, Representative Therriault, Representative
Hanley, and with Senator Phillips as Chair of the Committee.
He asked that resumes be sent to all members of the LBA
Committee.
ADJOURNMENT
The meeting adjourned.
LBA 1 12/12/97
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