Legislature(1997 - 1998)

03/26/1997 08:25 AM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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                      HOUSE FINANCE COMMITTEE                                  
                          March 26, 1997                                       
                             8:25 A.M.                                         
                                                                               
 TAPE HFC 97-80, Side 1, #000 - end.                                           
 TAPE HFC 97-80, Side 2, #000 - end.                                           
                                                                               
 CALL TO ORDER                                                                 
                                                                               
 Co-Chair Hanley called the House Finance Committee meeting to order           
 at 8:25 a.m.                                                                  
                                                                               
 PRESENT                                                                       
                                                                               
 Co-Chair Hanley               Representative Kelly                            
 Co-Chair Therriault           Representative Kohring                          
 Representative Davies         Representative Martin                           
 Representative Davis          Representative Moses                            
 Representative Foster         Representative Mulder                           
 Representative Grussendorf                                                    
                                                                               
 ALSO PRESENT                                                                  
                                                                               
 Representative Williams; Frank Rue, Commissioner, Department of               
 Fish and Game; Bob Clasby, Director, Division of Commercial                   
 Fisheries; Tracy Crammer, Exxon Valdez Trust Council, Department of           
 Fish and Game; Tom Wright, Staff, Representative Ivan, Ginny Fay,             
 Alaska Environmental Lobby; Ginger Patton, Fiscal Analyst,                    
 Legislative Finance Division; Michelle Brown, Commissioner,                   
 Department of Environmental Conservation.                                     
                                                                               
 SUMMARY                                                                       
                                                                               
 HB 75     "An Act making appropriations for the operating and loan            
           program expenses of state government, for certain                   
           programs, and to capitalize funds; and providing for an             
           effective date."                                                    
                                                                               
           HB 75 was HELD in Committee for further consideration.              
                                                                               
 HB 76     "An Act making appropriations for the operating expenses            
           of the state's integrated comprehensive mental health               
           program; and providing for an effective date."                      
                                                                               
           HB 76 was HELD in Committee for further consideration.              
                                                                               
 HOUSE BILL NO. 75                                                             
                                                                               
      "An Act making appropriations for the operating and loan                 
      program expenses of state government, for certain programs,              
      and to capitalize funds; and providing for an effective date."           
                                                                               
 AMENDMENTS                                                                    
                                                                               
 DEPARTMENT OF FISH AND GAME                                                   
 DEPARTMENT OF ENVIRONMENTAL CONSERVATION                                      
                                                                               
 DEPARTMENT OF FISH AND GAME                                                   
                                                                               
 Representative Moses MOVED to adopt Amendment FG-1 (copy on file).            
 Co-Chair Hanley OBJECTED.  The amendment would add $165 thousand              
 dollars to the Department of Fish and Game, Commercial Fisheries              
 Management and Development, Fisheries Development.  Representative            
 Moses maintained that the appropriation amount should be ten times            
 greater.                                                                      
                                                                               
 Representative Grussendorf spoke in support of Amendment FG-1.  He            
 pointed out that the fisheries industry is the state's largest                
 employer.  He stressed that the amendment will increase economic              
 development opportunities.                                                    
                                                                               
 Representative Martin questioned if the fishing market is over-               
 saturated and over-developed.  He noted the amount of jobs that go            
 to out-of-state workers.                                                      
                                                                               
 Representative Moses stated that some fisheries are under-                    
 developed.                                                                    
                                                                               
 Representative Grussendorf pointed out that there are fisheries               
 other than salmon.  He asserted that the market can absorb                    
 additional product.                                                           
                                                                               
 FRANK RUE, ACTING COMMISSIONER, DEPARTMENT OF FISH AND GAME                   
 asserted that the answer to the salmon problem is to find new                 
 markets and expand current markets, not to cut back on the product.           
 He maintained that a reduction in salmon management would make the            
 state less competitive.                                                       
                                                                               
 BOB CLAUSBY, DIRECTOR, DIVISION OF COMMERCIAL FISHERIES observed              
 that the amendment would impact Cook Inlet, Northern Peninsula, and           
 Bristol Bay salmon.  The amendment would also have an effect on               
 projects by non-profits and federal agencies to rehabilitate areas            
 with depressed salmon populations.  He maintained that the low                
 price of salmon is a short-term trend.  He pointed out that pink              
 salmon inventory is almost all gone.  He asserted that, of all                
 fishery resources, salmon provides the greatest benefits to                   
 Alaska's economy.                                                             
                                                                               
 Representative Martin asked why the salmon fisheries should be                
 subsidized.                                                                   
                                                                               
 Commissioner Rue emphasized that the program helps the Department             
 manage for maximum yield of the species.  He maintained that the              
 salmon industry pays for itself.                                              
                                                                               
 A roll call vote was taken on the MOTION to adopt Amendment FG-1.             
                                                                               
 IN FAVOR:  Davies, Grussendorf, Moses, Foster                                 
 OPPOSED:  Davis, Kelly, Kohring, Martin, Mulder, Therriault, Hanley           
                                                                               
 The MOTION FAILED (4-7).                                                      
                                                                               
 Representative Grussendorf MOVED to adopt Amendment FG-2 (copy on             
 file).  Amendment FG-2 would add $115 thousand dollars to the                 
 Division of Subsistence.  Representative Grussendorf noted that               
 subsistence management is one of the biggest issues facing the                
 state.  He pointed out that the Division of Subsistence needs to              
 develop baseline data.   He noted the number of subsistence issues            
 before the Board of Fish.  He stressed that the Board of Fish will            
 have to rule conservatively on subsistence issues if sufficient               
 data is not available.                                                        
                                                                               
 Commissioner Rue pointed out that 40 percent of the Subsistence               
 Division's general fund support has been eliminated.  He stated               
 that the amendment would allow the Boards of Fish to provide for              
 subsistence opportunity without unduly restricting other                      
 opportunities.  He stressed that the state system tries to                    
 accommodate all users.  He stated that without good subsistence               
 data other users may be unduly restricted, enough resource for                
 subsistence may not be provided, and subsistence users may become             
 disillusioned with the state system.   He observed that                       
 disillusioned subsistence users will look to the federal                      
 government.                                                                   
                                                                               
 Representative Foster observed that the Subsistence Division's Nome           
 office was eliminated.  He noted that the Division lacks a rural              
 presence.                                                                     
                                                                               
 Co-Chair Hanley explained that the intent of creating a Rural                 
 Subsistence BRU is to encourage a rural presences.                            
                                                                               
 Representative Grussendorf stressed the need to gain the support of           
 rural users.                                                                  
                                                                               
 Commissioner Rue emphasized that the Department's intent is to                
 increase its rural presence.                                                  
                                                                               
 A roll call vote was taken on the MOTION to adopt Amendment FG-2.             
                                                                               
 IN FAVOR: Foster, Davies, Grussendorf, Moses                                  
 OPPOSED:  Davis, Kohring, Martin, Mulder, Therriault, Hanley                  
                                                                               
 Representative Kelly was absent from the vote.                                
                                                                               
 The MOTION FAILED (4-6).                                                      
                                                                               
 Representative Foster MOVED to adopt Amendment FG-3 (copy on file).           
 Amendment FG-3 as revised by Representative Foster would add $94.2            
 thousand dollars to the Rural Subsistence BRU and delete the same             
 amount from the Office of the Commissioner.  He noted that only 2             
 of 17 positions in the Subsistence Division are in rural areas of             
 the state.                                                                    
                                                                               
 TOM WRIGHT, STAFF, REPRESENTATIVE IVAN IVAN spoke in support of the           
 amendment.                                                                    
                                                                               
 Representative Martin questioned the wisdom of reducing the                   
 Commissioner's staff.  He pointed out that subsistence is a                   
 statewide issue.  He asked why existing positions should not be               
 transferred.                                                                  
                                                                               
 Representative Grussendorf spoke in support of additional                     
 subsistence funding, but expressed concern with the funding source.           
 He noted that the position that would be eliminated coordinates               
 subsistence, salmon marketing and the hatcheries.  The position               
 also acts as a legislative liaison.                                           
                                                                               
 Commissioner Rue spoke against the amendment.  He stressed the need           
 for a coordinated position on issues before the legislature.  He              
 stated that the function will need to be continued.  He stressed              
 that the amendment will have a ripple down effect in the                      
 Department.                                                                   
                                                                               
 Co-Chair Hanley pointed out that there are other Departments that             
 have less positions in their commissioner's office.                           
                                                                               
 Representative Grussendorf pointed out the importance of the                  
 Department of Fish and Game to the public.  He maintained that, due           
 to public input, the Department of Fish and Game needs a higher               
 level of management than some other departments.                              
                                                                               
 Representative Grussendorf spoke in support of changing the funding           
 source.                                                                       
                                                                               
 Representative Kohring spoke in support of the amendment.                     
                                                                               
 A roll call vote was taken on the MOTION to adopt Amendment FG-3.             
                                                                               
 IN FAVOR: Foster, Kelly, Kohring, Mulder, Therriault, Hanley                  
 OPPOSED:  Davies, Davis, Grussendorf, Martin, Moses                           
                                                                               
 The MOTION PASSED (6-5).                                                      
                                                                               
 Representative Foster MOVED to adopt Amendment FG-4 on behalf of              
 Representative Williams (copy on file).  Amendment FG-4 would                 
 delete $96.1 thousand dollars for an assistant director in the                
 Department of Fish and Game/Commercial Fisheries Management and               
 Development; and add the same amount in Commercial Fisheries                  
 Management and Development/Special Projects for special projects              
 relating to the Southeast sea urchin fishery.                                 
                                                                               
 REPRESENTATIVE BILL WILLIAMS spoke in support of Amendment FG-4.              
 He explained that the amendment will assist the Southeast sea                 
 urchin fishery.  An assistant director's position would be deleted            
 from Juneau.                                                                  
                                                                               
 Commissioner Rue spoke in support of funding for the sea urchin               
 fishery.  He pointed out that the assistant director position has             
 already been deleted.  He stated that funding would have to come              
 from another area of the Commercial Fisheries Management and                  
 Development component.  He observed that this component was reduced           
 by $500 thousand dollars in FY 98.                                            
                                                                               
 (Tape Change, HFC 97-80, Side 2)                                              
                                                                               
 Mr. Clausby emphasized the need to look at additional opportunities           
 for funding new fisheries.  He noted that there is a diver's task             
 force addressing the issue of funding the sea urchin fisheries.  He           
 estimated that $150 thousand dollars a year is needed to manage the           
 Southeast sea urchin fisheries.  He expressed concerns that an                
 existing program would be reduced to fund a new program.   He                 
 observed that six senior positions have been cut in the past five             
 years.  He stressed that the management of subsistence, commercial            
 and personal use fisheries is starting to unravel.  He stated that            
 more cuts in upper level management will result in serious                    
 consequences.                                                                 
                                                                               
 Representative William noted that the Bering Sea/Bristol Bay king             
 crab fisheries is open and requires additional funding.  He noted             
 that the Aleutians sea urchin fisheries could be developed.                   
                                                                               
 A roll call vote was taken on the MOTION to adopt Amendment FG-4.             
                                                                               
 IN FAVOR: Davies, Grussendorf, Moses, Davis, Foster, Kelly,                   
           Kohring, Martin, Mulder, Therriault, Hanley                         
 OPPOSED:  0                                                                   
                                                                               
 The MOTION PASSED (11-0).                                                     
                                                                               
 DISCLOSURES                                                                   
                                                                               
 Co-Chair Hanley disclosed that he commercial fishes in Bristol Bay.           
                                                                               
 DEPARTMENT OF ENVIRONMENTAL CONSERVATION                                      
                                                                               
 Representative Kohring noted that Amendment DEC-1 was proposed by             
 the Governor.  The amendment would approve $1,655.9 million dollars           
 in Exxon Valdez Oil Settlement funds for projects approved by the             
 Exxon Valdez Oil Spill Trustee Council.                                       
                                                                               
 TRACY CRAMER, EXXON VALDEZ TRUSTEE COUNCIL explained that the                 
 Governor's budget included a front section appropriation to carry             
 forward the RPL that was approved by the Legislative Budget and               
 Audit Committee from August 1997 to June 30, 1998.  She observed              
 that the budget amendment deleted the front section carry-forward             
 language and requested that the authority to receive and expand be            
 included in the back section of the budget.  She noted that the two           
 projects addressed by the amendment are currently underway.  The              
 amendment would allow these projects to continue into fiscal year             
 98.                                                                           
                                                                               
 Co-Chair Hanley observed that the intent is to move items to the              
 back section in order to better track projects.                               
                                                                               
 GINNY FAY, SPECIAL ASSISTANT, DEPARTMENT OF ENVIRONMENTAL                     
 CONSERVATION discussed the projects contained in the amendment.               
 She noted that the amendment continues a Kodiak Island Master Waste           
 Management Plan to analyze waste entering the spill impacted area             
 in order to measure impact and speed recover.  The other project is           
 the Chenega Shoreline Residual Oil Reduction project to remove                
 residual oils from the beaches near the village of Chenega.                   
 Representative Kohring MOVED to adopt Amendment DEC-1 (copy on                
 file).  There being NO OBJECTION, it was so ordered.                          
                                                                               
 Representative Kohring explained that Amendment DEC-2 corrects a              
 technical error (copy on file).                                               
                                                                               
 GINGER PATTON, FISCAL ANALYSTS, LEGISLATIVE FINANCE DIVISION                  
 explained that the amendment corrects an error she made in                    
 recording the Subcommittee's reduction.                                       
                                                                               
 Representative Davies summarized that the intent of the                       
 Subcommittee was to delete a position in the Animal Industries                
 component.  The fiscal analyst mistakenly made the deletion in the            
 Seafood and Sanitation component.  To correctly reflect the                   
 Subcommittee's action a position needs to be added back into the              
 Seafood and Sanitation Inspection component and a position deleted            
 from the Animal Industries component.                                         
                                                                               
 Ms. Patton agreed that the Animal Industries component is over-               
 funded by $101 thousand dollars.                                              
                                                                               
 Co-Chair Hanley pointed out that the $101. thousand dollars                   
 deletion in the Animal Industries component should not be                     
 represented by brackets.                                                      
                                                                               
 Representative Kohring MOVED to Amend, Amendment DEC-2, by reducing           
 the reduction to $50.6 thousand dollars and to reinstate an                   
 inspector position.  He explained that the facility operator has              
 estimated that the position could be operated part-time.                      
                                                                               
 BARBARA FRANK, BUDGET ANALYST, DEPARTMENT OF ENVIRONMENTAL                    
 CONSERVATION explained that the FDA requires that an inspector be             
 present during processing.  She noted that the operator will only             
 be able to operate when the inspector is on site.  She clarified              
 that the amendment addresses a slaughtering facility.                         
                                                                               
 Co-Chair Therriault noted that animals are slaughtered in batches.            
                                                                               
 Ms. Frank noted that the Department's calculation was based on the            
 operator's estimate of production.  She added that the Department             
 has to pay for time the position spends in training.                          
                                                                               
 There being NO OBJECTION, the amendment to Amendment DEC-2 was                
 adopted.  There being NO OBJECTION, Amendment DEC-2 was adopted as            
 amended.                                                                      
                                                                               
 Co-Chair Therriault MOVED to adopt Amendment DEC-3 (copy on file).            
 Amendment DEC-3 would add $199 thousand general fund dollars and              
 $264.7 thousand dollars in general fund program receipts to the               
 Department of Environmental Conservation, Environmental Health,               
 Solid Waste.  He explained that the intention is to retain state              
 primacy in the solid waste program.  He observed that dumping                 
 facilities would be more expensive to operate under the management            
 of the federal Environmental Protection Agency.                               
                                                                               
 Representative Kohring OBJECTED for purposes of discussion.  He               
 emphasized the need to make major reductions in the state's                   
 operating budget.  He observed that the Subcommittee reduced this             
 component by $800 thousand dollars.  After discussions with the               
 Department it was ascertained that the state could not administer             
 the program with the remaining funding.  The Subcommittee then                
 voted to delete the remaining funding.                                        
                                                                               
 MICHELLE BROWN, COMMISSIONER, DEPARTMENT OF ENVIRONMENTAL                     
 CONSERVATION agreed that the state could not run the program with             
 a $800 thousand dollar reduction.  She stated that additional                 
 funding contained in Amendment DEC-3 and proposed by other                    
 amendments may allow the state to argue for state primacy.                    
                                                                               
 Representative Kohring suggested that the program be run out of               
 program receipts.  He noted that municipalities would have to pay             
 for the program.                                                              
                                                                               
 Co-Chair Hanley observed that the federal government will take over           
 the program if state funding is eliminated.  He stressed that the             
 federal government does not have the flexibility that the                     
 Department of Environmental Conservation would have.  He estimated            
 that communities would pay substantially more for the program if it           
 is managed by the federal government.  He added that the program              
 also manages rural sanitation.  He observed that urban communities            
 would pay to support rural communities.  He stated that a mixed               
 approach would be more equitable.                                             
                                                                               
 Representative Kohring spoke in support of a mixed approach,                  
 utilizing program receipts.                                                   
                                                                               
 Co-Chair Therriault observed that the Department can only assess              
 fees to urban landfills.  He stressed that if the program is only             
 supported by fees, then urban rates will go up to support                     
 facilities in rural areas.  He maintained that the state can                  
 negotiate with the federal government to maintain primacy.                    
                                                                               
 In response to a question by Representative Grussendorf,                      
 Commissioner Brown explained that the state does not have a                   
 hazardous waste program.  The state assists communities in the                
 operation of household hazardous waste pick-ups.  She noted that if           
 the state's solid waste program is eliminated that communities will           
 have to abide by federal standards.  She observed that no state has           
 ever not run a solid waste program.  She noted that citizen suits             
 could occur if the state's program is eliminated.   If the program            
 is reduced there would be a reduced effort toward community                   
 household waste removal.  She added that the program regulates                
 industrial waste.  She explained that the federal government would            
 not regulate industrial waste.  Industrial waste will not be                  
 regulated if the state's program is eliminated.                               
                                                                               
 Co-Chair Hanley observed that the intent is to provide enough                 
 funding to allow the retention of state primacy.                              
                                                                               
 Representative Kohring stressed that the effect of federal                    
 regulation of the solid waste program is unknown.  He questioned              
 the effect of federal regulation of the hazardous waste program.              
                                                                               
 Commissioner Brown stated that federal regulation of the hazardous            
 waste program has resulted in more enforcement and less technical             
 assistance.  The cost to operators has increased.  She reiterated             
 that less flexible federal standards will result in an increase in            
 cost to the communities.                                                      
                                                                               
 Representative Kohring maintained that the program should be paid             
 by the users of the program.  He spoke in support of Amendment DEC-           
 3 as part of a phase-out approach.                                            
                                                                               
 There being NO OBJECTION, Amendment DEC-3 was adopted.                        
                                                                               
 Co-Chair Therriault MOVED to adopt Amendment DEC-4 (copy on file).            
 He explained that funding was received from the Alaska Pulp Company           
 for clean-up at the Sitka mill site.  This funding was deposited              
 into the Mitigation Account and expended from the Oil/Hazardous               
 Prevention/Response Fund.  He observed that this has freed general            
 funds to be used for Community Health/EMS grants.                             
                                                                               
 Co-Chair Therriault MOVED to AMEND Amendment DEC-4 by transferring            
 $226.3 thousand dollars from EMS grants to Environmental Health               
 Solid Waste.  There being NO OBJECTION, it was so ordered.                    
                                                                               
 There being NO OBJECTION, Amendment DEC-4 was adopted as amended.             
                                                                               
 HB 75 and HB 76 were HELD in Committee for further consideration.             
                                                                               
 ADJOURNMENT                                                                   
                                                                               
 The meeting adjourned at 10:02 a.m.                                           
                                                                               

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