Legislature(1999 - 2000)
03/06/2000 09:50 AM House FIN
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* first hearing in first committee of referral
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HOUSE FINANCE COMMITTEE
March 6, 2000
9:50 A.M.
TAPE HFC 00 - 56, Side 1.
CALL TO ORDER
Co-Chair Mulder called the House Finance Committee meeting
to order at 9:50 A.M.
PRESENT
Co-Chair Mulder Representative Foster
Co-Chair Therriault Representative Grussendorf
Representative Austerman Representative Moses
Representative Bunde Representative Phillips
Representative J. Davies Representative Williams
Representative G. Davis
ALSO PRESENT
Annalee McConnell, Director, Division of Management and
Budget, Office of the Governor; Dwayne Peeples, Director,
Division of Administrative Services, Department of
Corrections; Chris Phillips, Director of Finance, Alaska
Permanent Fund Corporation, Department of Revenue.
SUMMARY
HB 312 An Act making and amending appropriations for the
operating and loan program expenses of state
government, for certain programs, and to
capitalize funds; making appropriations under art.
IX, sec. 17c, Constitution of the State of Alaska,
from the constitutional budget reserve fund; and
providing for an effective date.
HB 312 was HEARD and HELD in Committee for further
consideration.
HB 313 An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing
for an effective date.
HB 313 was HEARD and HELD in Committee for further
consideration.
HOUSE BILL NO. 312
An Act making and amending appropriations for the
operating and loan program expenses of state
government, for certain programs, and to capitalize
funds; making appropriations under art. IX, sec. 17c,
Constitution of the State of Alaska, from the
constitutional budget reserve fund; and providing for
an effective date.
HOUSE BILL NO. 313
An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date.
AMENDMENTS:
DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT
DEPARTMENT OF REVENUE
DEPARTMENT OF CORRECTIONS
Co-Chair Mulder addressed the anticipated order which the
amendment process would follow.
Co-Chair Therriault MOVED to adopt the work draft committee
substitutes, (HB 312) 1-LS1304\D, Utermohle, 3/1/00 and (HB
313) 1-LS1305\D, Utermohle, 3/1/0, as the versions before
the Committee. There being NO OBJECTION, they were adopted.
DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT
Representative J. Davies MOVED to ADOPT Amendment Labor-1.
ADD:
Sec.__ (a) Subject to (b) of this section, the sum of
$500,000 is appropriated from the general fund to the
Department of Labor and Workforce Development, division of
labor standards and safety, for occupational safety and
health.
(b) The appropriation made by (a) of this section is
conditioned upon the failure to enact into law after passage
during the Second Session of the 21st Alaska State
Legislature a version of HB 378, relating to worker safety
programs.
Co-Chair Mulder OBJECTED for the purpose of discussion.
Representative J. Davies explained the amendment. He stated
that the appropriation would be subject to the passage of HB
378 or SB 272.
Co-Chair Mulder inquired the anticipated support for HB 378.
Representative J. Davies noted that the bill is fair and
that the Administration and the State Minority are
supporting it.
Co-Chair Mulder pointed out that the Senate version is SB
272. Representative J. Davies MOVED to amend the proposed
amendment by adding the language "SB 272". There being NO
OBJECTION, the language to the amendment was adopted.
Co-Chair Therriault suggested that the incentive would be
lost if either of those bills were passed. Co-Chair Mulder
agreed that the language could provide a strong incentive.
He asked for Representative J. Davies support in passing
either of the bills through the Legislature.
Representative Austerman clarified that there are other
options to address the proposed concern.
Co-Chair Therriault OBJECTED to the amendment, stating that
the leverage should not be given up yet.
Representative J. Davies requested a commitment from the
Majority that those bills pass "to fill the hole". Co-Chair
Mulder advised that was part of the spending plan.
Representative Austerman agreed. He pointed out that the
Subcommittee did support the concept.
Representative Grussendorf reminded members that each Body
operates separately. He noted that if the bills did not
pass, it would jeopardize these programs. Co-Chair Mulder
responded that if there was a problem on the Senate side, he
would place this into the capital reappropriation
legislation or another bill.
Representative J. Davies countered that if this amendment
was adopted, then there would be an incentive to take this
money off the table. Co-Chair Mulder reiterated that no one
wants a hole to develop.
A roll call vote was taken on the motion.
IN FAVOR: J. Davies, Moses, Grussendorf
OPPOSED: Bunde, G. Davis, Foster, Phillips, Williams,
Austerman, Mulder, Therriault
The MOTION FAILED (3-8).
Representative J. Davies MOVED to ADOPT Amendment Labor-2:
ADD:
Sec.__ (a) Subject to (b) of this session, the sum of $1 million
dollars is appropriated from the general fund to the Department of
Labor and Workforce Development, division of workers' compensation.
(b) The appropriation made by (a) of this session is effective upon
the failure to enact into law after passage during the Second
Session of the 21st Alaska State Legislature a version of HB 378,
relating to workers' compensation.
Representative J. Davies MOVED a technical change which would
include HB 378 or SB 272. There being NO OBJECTION, the change was
made to the amendment.
Co-Chair Mulder OBJECTED to the amended Labor-2.
A roll call vote was taken on the motion.
IN FAVOR: J. Davies, Grussendorf, Moses
OPPOSED: G. Davis, Foster, Phillips, Williams,
Austerman, Bunde, Therriault, Mulder
The MOTION FAILED (3-8).
DEPARTMENT OF MILITARY & VETERANS AFFAIRS
NO AMENDMENTS
ALASKA COURT SYSTEM
NO AMENDMENTS
DEPARTMENT OF REVENUE
Vice Chair Bunde MOVED to ADOPT Amendment REV-1:
DELETE:
Permanent Fund Corporation $8,189,900
Custody and Management fees
INSERT:
Permanent Fund Corporation $8,180,900
Custody and Management fees
Representative J. Davies OBJECTED. Vice Chair Bunde
explained that the amendment would help to more carefully
track money management monies. The total amount would be
$47,585,800 dollars. He added, it would track management
fees versus operational costs.
Representative Grussendorf advised that he had served on
the Revenue Subcommittee for years and did not think that
there was a need for the amendment. Vice Chair Bunde asked
to hold the discussion until someone from the Department of
Revenue could clarify regarding the concern. Co-Chair
Mulder noted that there would be a net gain of $5 million
dollars in management fees with passage of the amendment.
Vice Chair Bunde WITHDREW the REV-1 until further
clarification could be made through the Department.
DEPARTMENT OF CORRECTIONS
Representative J. Davies MOVED to ADOPT Amendment CORR-1.
Co-Chair Mulder OBJECTED.
ADD:
Out of State Contracts BRU
Out-of-state Contracts $1,000,000 GF
Representative J. Davies explained that the Department's
purchases contract beds at Central Arizona Detention Center
(CADC) to manage the prisoner population at Alaska
correctional centers within safe levels. A $1.0 million
reduction will require the Department to reduce the contract
with CADC by a total of 55 beds. If the Department
experiences significant population growth during the fiscal
year, the budget reduction may result in overcrowding of the
State's correctional centers which threatens staff and
inmate safety. In order to avoid this problem, the
Department may need to request supplemental funding during
the fiscal year to purchase additional beds to manage the
population in accordance with national standards and court
mandates.
DWAYNE PEEPLES, DIRECTOR, ADMINISTRATIVE SERVICES,
DEPARTMENT OF CORRECTIONS, reiterated that there will be
problems with population management in the next fiscal year.
If the Department can not maintain the population within the
existing facility, there will be a supplemental request.
Co-Chair Mulder noted that the proposed budget is $1 million
dollars below last year. He noted that there has been a
slight growth in the prison population. Co-Chair Mulder
asked the anticipated dollars lapsing from out-of-state
contracts. Mr. Peeples noted that those figures would be
available in the middle of March; it could be $1 million
dollars or less. Co-Chair Mulder noted that the budget was
based on no radical changes in the prison population.
Representative J. Davies WITHDRW amendment CORR-1.
Representative J. Davies MOVED to ADOPT Amendment CORR-2.
Co-Chair Mulder OBJECTED.
ADD:
Administration and Operations BRU
Institutions Directors Office Component $225.0 GFPR
Representative J. Davies noted that the Department requested
$225.0 additional General Fund Program Receipt authority to
bill municipalities for incarcerating prisoners charged
under local ordinances and housed in State facilities.
He pointed out that the Subcommittee had recommended denying
this request, which in effect eliminates the Department's
ability to utilize these funds from local municipalities for
operational expenses from incarcerating prisoners, charged
under non-state statutes.
The result of that action would be that the Department will
continue to house these prisoners, but will not be able to
utilize the receipts, which in turn will be subsidized at
the expense of reducing other state-funded public safety
services.
Mr. Peeples explained that the program receipts are
collected from the municipalities for housing prisoners
arrested under local ordinances. The Department is
population driven and with the out-of-state budget being
reduced, more prisoners will be housed in State. The
Department is requesting that these program receipts be
added back into the budget for operational expenses.
Co-Chair Mulder asked which municipalities would be
assessed. Mr. Peeples replied that funds are collected from
Anchorage, Fairbanks, Ketchikan and Juneau, and would be
added back.
Co-Chair Mulder recommended to the Subcommittee, not to add
the requested amount because it would not be good business
for the State to "give" money on one hand and then "take it
away" on the other hand with the cuts to municipal sharing.
He agreed with the concept of having users pay but
recommended creating a better scheme.
Representative J. Davies stated that this is not a radical
departure from, but a continuation of an existing practice.
He spoke to the pressure from the previous amendment,
withdrawing inmates from Arizona, there is a more pressure
to solve the problems. He believed that it would be better
to grant receipt authority which would not change the fiscal
gap. Without the authority, they can not collect the money.
It is not contradictory to give money to the municipalities.
He concluded that the decision should be made at the local
level.
Co-Chair Mulder responded that the way in which the budget
is structured, it will be adjusting more people toward less
costly housing and then transitioning them into the
community earlier. He acknowledged that Arizona is the
"shock absorber". A proposed growth is not addressed in
this budget.
Representative J. Davies MOVED to change the amendment to
Statutory Designated Program Receipts (SDPR). Co-Chair
Mulder countered that this funding is not SDTR but rather is
General Fund receipts because it is a fee for a service.
Representative J. Davies pointed out that any SDTR receipt
is a receipt for a service. Co-Chair Mulder argued that
this is not a contract and that a service is being provided.
Mr. Peeples interjected that the State does function under
contract arrangements with the municipalities.
Representative G. Davis pointed out that Anchorage has
municipal Courts. He asked if the other municipalities had
municipal courts. Mr. Peeples thought that they did.
Co-Chair Mulder inquired how much GFPR had been allowed in
this category. Mr. Peeples offered to provide that
information. Co-Chair Mulder reiterated that the request
was an increment.
ANNALEE MCCONNELL, DIRECTOR, OFFICE OF MANAGEMENT AND
BUDGET, OFFICE OF THE GOVERNOR, commented that the amendment
would be appropriate for the State to do as a contractual
agreement. The amendment is directed at activities in which
the State is housing prisoners. She added that the Courts
are not technically Municipal Courts.
Co-Chair Mulder corrected that this was originally a fee for
service as proposed in the Governor's budget. Mr. Peeples
replied that these were submitted as SDPR's. Co-Chair
Mulder maintained his objection to the amendment, in order
that there could continue to be consistency.
A roll call vote was taken on the motion.
IN FAVOR: Grussendorf, Moses, J. Davies
OPPOSED: Foster, Phillips, Williams, Austerman, Bunde,
Mulder, Therriault
Representative G. Davis was not present for the vote.
The MOTION FAILED (3-7).
DEPARTMENT OF REVENUE
The Committee revisited amendment REV-1.
CHRIS PHILLPS, DIRECTOR OF FINANCE, ALASKA PERMANENT FUND
CORPORATION, DEPARTMENT OF REVENUE, stated that the
amendment would present no problem to the Alaska Permanent
Fund Corporation. Representative J. Davies WITHDREW his
objection. There being NO further OBJECTIONS, REV-1 was
adopted.
HB 312 and HB 313 were HELD in Committee for further
consideration.
ADJOURNMENT
The meeting adjourned at 10:35 A.M.
H.F.C. 8 3/06/00 A.M.
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