Legislature(1999 - 2000)
03/06/1999 02:00 PM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
March 6, 1999
2:00 P.M.
TAPE HFC 99 - 38, Side 1.
TAPE HFC 99 - 38, Side 2.
CALL TO ORDER
Co-Chair Mulder reconvened the House Finance Committee
meeting, from 3/03/99, to order at 2:00 P.M.
PRESENT
Co-Chair Mulder Representative G. Davis
Co-Chair Therriault Representative Grussendorf
Vice-Chair Bunde Representative Foster
Representative Austerman Representative Kohring
Representative J. Davies
Representative Williams participated via teleconference from
Ketchikan.
Representative Moses was absent from the meeting.
ALSO PRESENT
SUMMARY
HB 100 "An Act making and amending capital, supplemental,
and other appropriations, and appropriations to
capitalize funds; ratifying certain expenditures;
and providing for an effective date."
HB 100 was HELD in Committee for further
consideration.
HOUSE BILL NO. 100
"An Act making and amending capital, supplemental, and
other appropriations, and appropriations to capitalize
funds; ratifying certain expenditures; and providing
for an effective date."
Co-Chair Mulder provided members with a spreadsheet
summarizing proposed changes to HB 100 (copy on file). The
proposed committee substitute was not available at the time
of the meeting. He reviewed changes to HB 100 as detailed in
the spreadsheet. He explained that $16.5 million dollars
were allocated for FY99 supplementals in the spending plan.
The spreadsheet begins with this assumption.
MILITARY AND VETERANS AFFAIRS
Co-Chair Mulder noted that the first change is in section 2.
He clarified that $1.2 million dollars was deleted from the
disaster appropriation for road washouts. He explained that
the Department of Transportation and Public Facilities
anticipates federal funding to replace this appropriation.
If the funds are not received before the end of the fiscal
year they will need to be reconciled.
DEPARTMENT OF NATURAL RESOURCES
Co-Chair Mulder noted that funding of $134.5 thousand
dollars for repair of the Perseverance Trail was eliminated.
He explained that the request was not funded in order to
encourage the transfer of the trail to the city and borough
of Juneau.
Representative Grussendorf asked what incentive the city
would have to take over the trail maintenance. Co-Chair
Mulder stated that the city would have an incentive to take
over the trail if it remains closed. Representative J.
Davies asked who would be liable for the injuries on the
trail. Co-Chair Mulder suggested that a closure sign would
alleviate liability to the state. Representative Grussendorf
did not think that a sign would prevent the state from being
liable for injuries.
Co-Chair Mulder expressed concern that winter maintenance of
roads would be excluded while funding for a recreational
trail repair was included. Representative G. Davis agreed
with remarks by Co-Chair Mulder.
MILITARY AND VETERANS AFFAIRS
Co-Chair Mulder reviewed the Western Alaska Fisheries
Disaster. He noted that the appropriation goes back to the
1997 fisheries disaster. The appropriation was made into a
local community grant program in FY99 in order to qualify
for federal funds. He stressed that because many of the
improvements detailed within the 1997 disaster are capital
projects they should be addressed in the capital matching
grants program. He observed that there is a 6 to 1 match.
The match was deleted from this appropriation and will be
addressed in the capital budget.
DEPARTMENT OF CORRECTIONS
Co-Chair Mulder noted that the only modifications, made to
the Department of Corrections, that the department does not
support are the reductions in staffing at the Cook Inlet and
the deletion of a VPSO parole pilot program. He noted that
the pilot program has not been implemented. It would not
reduce service.
DEPARTMENT OF ADMINISTRATION
Co-Chair Mulder discussed section 6(g) and (h). Pioneer home
receipts were reflected as off budget in the Governor's
proposal. These were reflected as general funds in the
spreadsheet. The appropriation level would not change.
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT
Co-Chair Mulder explained that the allocation for Power Cost
Equalization (PCE) was not approved. He stressed that the
department continued to spend knowing that there would be a
deficit. He emphasized that the fund would be depleted at a
quicker rate if appropriations from the fund occur. He
emphasized that they would continue to try to resolve the
problem.
DEPARTMENT OF REVENUE
Co-Chair Mulder discussed debt service. He noted that the
Governor proposed using an Alaska Housing Finance
Corporation (AHFC) dividend for debt service. This $1,143.9
million dollar offset was denied.
DEPARTMENT OF EDUCATION
Co-Chair Mulder noted that the Education Foundation Formula
was reduced by $4 million dollars. The Department of
Education worked with the Committee to find funding.
DEPARTMENT OF HEALTH AND SOCIAL SERVICES
Co-Chair Mulder discussed the Chronic and Acute Medical
Assistance program (CAMA). He noted that it would be fully
funded. Co-Chair Therriault explained that the overall
number is down slightly from $1.2 million dollars to $1,145.
million dollars. The are additional federal Temporary
Assistance to Needy Families (TANF) funds in the Department
of Health and Social Services. These cannot be used to cover
CAMA. The balance of TANF funds could be used to support
childcare in Department of Community and Regional Affairs,
which is part of the welfare reform effort. General funds
would be freed by the use of TANF funding and general funds
from the daycare program would be transferred back to
Department of Health and Social Services.
Co-Chair Therriault explained that the state has a balance
of TANF funding with the federal government. Part of this is
from the extra money the state of Alaska receives at the end
of the three-year authorization period.
Representative J. Davies noted that part of these monies
have been used to support the increase demand in childcare,
resulting from the Welfare to Work program. He asked if
there would be sufficient funding to cover this need. Co-
Chair Therriault acknowledged that some of the excess
federal balance could have been used for something else. He
stressed that CAMA funding is a pressing need. Co-Chair
Mulder pointed out that the department has worked with the
Committee on the transfer.
Co-Chair Mulder observed that subsidized adoptions are being
funded at the Governor's proposed level. He noted that there
would be further discussions regarding this level.
DEPARTMENT OF LAW
Co-Chair Mulder noted that Item 13, oil and gas litigation
would be revised. The Attorney General has identified an
additional $82 thousand dollars in reductions from oil and
gas litigation. The total reduction would be $182 thousand
dollars.
DEPARTMENT OF NATURAL RESOURCES
Co-Chair Mulder explained that $62.7 thousand dollars of the
$92 thousand dollar request for the Recorder's Office was
approved to allow for hard costs.
DEPARTMENT OF PUBLIC SAFETY
Co-Chair Mulder noted that the request for Alaska State
Trooper Detachments was brought down from $312 thousand
dollars to $249.6 thousand dollars. He noted that the moving
costs were excluded. He referred to the State Trooper
Academy. Representative G. Davis noted that the authorized
funding level anticipated eight additional troopers. The
department anticipated hiring 17 positions. The additional
new troopers have resulted in additional costs at the
Academy.
UNIVERSITY OF ALASKA
Co-Chair Mulder explained that there were two $3.5 million
dollar offsets that were non-general fund. He stated that
there is a total $7 million dollar non-general fund
authorization for Arctic Research.
Co-Chair Mulder summarized that with the additional $1.2
million dollars from debt service and CAMA as a reduction,
the total is $1.9 million dollars below a net zero.
DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS
Representative Grussendorf observed that there would be a 43
percent funding level for PCE without the appropriation. He
noted it was not a particularly good economic year for many
rural coastal areas.
Representative Austerman noted that PCE administration
decided to provide full funding through the winter and allow
the reduction to occur in the summer when power service is
down.
Co-Chair Therriault stressed that if PCE is to be continued
it would not be a continuation of the status quo. He did not
support the department's decision to retain the spending
level thinking that the difference would be appropriated
later. He stressed the need to see changes to the program.
Co-Chair Mulder noted that Mr. Cotton, Chairman of the Blue
Ribbon Committee on Power Cost Equalization recommended that
a mechanism be used to exclude some enterprises that
otherwise might be taking advantage of PCE. He stressed the
need for a long-term solution.
Representative Kohring stated that plans are being advanced
to phase out PCE and phase in an infrastructure that would
reduce costs.
Representative Austerman agreed that PCE might need to be
phased out in the long term. He expressed concern that
Representative Kohring's plan would destroy the Alaska
Science and Technology Foundation. Representative Kohring
emphasized that his plan would not spend the principle of
the Alaska Science and Technology Foundation endowment.
Co-Chair Mulder noted that delays in road openings were not
addressed. He observed that the Department of Transportation
and Public Facilities has submitted a schedule of road
openings, the cost of opening the roads and the population
that the roads serve.
Co-Chair Mulder noted that there would be a three-quarter
vote for the draw from the Constitutional Budget Reserve.
Representative J. Davies observed that the Blue Ribbon
Commission recommended unanimously that the PCE program be
funded. There was not a unanimous agreement on the mechanism
of the funding.
HB 100 was HELD in Committee for further consideration.
ADJOURNMENT
The meeting adjourned at 2:59 p.m.
HFC 6 3/06/99
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