Legislature(2001 - 2002)
05/12/2002 09:05 PM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
May 12, 2002
9:05 P.M.
TAPE HFC 02 - 111, Side A
CALL TO ORDER
Co-Chair Williams called the House Finance Committee meeting
to order at 9:05 P.M.
MEMBERS PRESENT
Representative Bill Williams, Co-Chair
Representative Eldon Mulder, Co-Chair
Representative Con Bunde, Vice-Chair
Representative Eric Croft
Representative John Davies
Representative Richard Foster
Representative John Harris
Representative Bill Hudson
Representative Ken Lancaster
Representative Carl Moses
Representative Jim Whitaker
MEMBERS ABSENT
None
ALSO PRESENT
Mary Jackson, Staff, Senator John Torgerson; Ronald Hull,
Director, Division of Employment Security, Department of
Labor and Work Force Development; Wendy Redman, Vice
President, Statewide Programs, University of Alaska; Mike
Tibbles, Staff, Representative Williams; Carol Carroll,
Director, Division of Support Services, Department of
Natural Resources and Military and Veterans Affairs; Ed
Flanagan, Commissioner, Department of Labor and Workforce
Development
PRESENT VIA TELECONFERENCE
James Wakefield, Chair, Balanced State Work Investment
Board, Realtor, Juneau; Linda Holbert, Fairbanks; Jim
Sanders; Mary Shields, General Manager, Technical Services,
Anchorage
SUMMARY
SB 252 An Act renaming the Alaska Human Resource
Investment Council as the Alaska Workforce
Investment Board and relating to its membership;
repealing the termination date of the state
training and employment program; relating to
employment and training activities; and providing
for an effective date.
HCS CS SB 252 (FIN) was reported out of Committee
with a "no recommendation" and with Department of
Labor & Workforce Development fiscal notes #4, #5,
#6, and #7.
SB 267 An Act establishing the Alaska veterans' memorial
endowment fund and providing for credits against
certain taxes for contributions to that fund;
relating to other tax credits for certain
contributions; and providing for an effective
date.
HCS CS SB 267 (FIN) was reported out of Committee
with a "do pass" recommendation and with fiscal
notes #1 by the Department of Military & Veterans
Affairs, #2 by the Department of Revenue and #3 by
the Department of Community & Economic
Development.
ALASKA MENTAL HEALTH TRUST AUTHORITY (AMHTA) CONFERMATION
Co-Chair Williams stated that there had been no negative
response to the recommendation of Bill Yonkers, Sr.,
Fairbanks, for the Alaska Mental Health Trust Authority
(AMHTA) Board.
The Confirmation Committee Report was distributed and all
votes were signed to confirm Bill Yonkers to that Board.
#SB252
CS FOR SENATE BILL NO. 252(FIN)
An Act renaming the Alaska Human Resource Investment
Council as the Alaska Workforce Investment Board and
relating to its membership; relating to repayment on
promissory notes for work-related items paid for by
grant programs; extending the termination date of the
state training and employment program; relating to
employment and training activities; and providing for
an effective date.
MARY JACKSON, STAFF, SENATOR JOHN TORGERSON, stated that the
bill was intended to extend the State Training and
Employment Program (STEP), pointing out that the audit
issues had been resolved. She noted that on Page 28, under
Section 48, indicates a report due to the Legislature next
year, completing the controversial issues.
Vice-Chair Bunde requested further information on the fiscal
notes.
RONALD HULL, DIRECTOR, DIVISION OF EMPLOYMENT SECURITY,
DEPARTMENT OF LABOR AND WORK FORCE DEVELOPMENT, stated that
fiscal notes #1 through #3 accompanied the original bill and
made the program permanent. Fiscal note #4 acknowledges the
services performed by the employment security program and
that a portion of the STEP funds would be used for work with
clients. Fiscal note #5 are funds designated for the
unemployment insurance program, a program funded through a
federal grant. Fiscal note #6 provides an added effort to
collect money paid out for tools and equipment.
Vice-Chair Bunde asked how much money would come back from
the $150 thousand dollars expended.
Mr. Hall indicated that was the Department's concern. He
stated that it would cost $65 thousand dollars to collect
$30 thousand dollars.
Vice-Chair Bunde commented that was "not good economy". He
asked about fiscal note #7.
Mr. Hull explained that #7 actually provides the grants and
the training. He added that the job training programs
provide services to the STEP clients. He added that the
employment service program also provides services to those
clients. He understood that there are between 50 and 60
people that use funds to provide services to the 1,500 STEP
clients a year.
Representative Harris asked if fiscal note #7 contained the
same amount of money as authorized in the FY02 budget.
Mr. Hull acknowledged that it was essentially the same but
would be hinged on the percentage of the money collected on
the employees that paid that tax.
JAMES WAKEFIELD, (TESTIFIED VIA TELECONFERENCE), CHAIR,
BALANCED STATE INVESTMENT BOARD, JUNEAU, assumed that most
legislators were familiar with the program which has been in
existence since 1989. It has trained over 18,000 Alaskans
during that time. He noted that the board is supportive of
the program and the current bill.
Mr. Wakefield commented that employers and the union
administer the joint apprenticeship programs. Those
programs have been going on for many years. There has been
a rural outreach to train people in rural Alaska.
Mr. Wakefield addressed a national problem of the "graying
of the workforce". It is happening in all areas, especially
in construction. There exists an issue with employment
worker training. Workers need to receive upgraded training
every three to five years to keep up with technology. The
STEP program is an excellent vehicle for that type of
service. He reiterated that the Board strongly supports the
program and urged passage of the bill.
LINDA HOLBERT, (TESTIFIED VIA TELECONFERENCE), REPRESENTING
THE PRIVATE SECTOR, FAIRBANKS, noted that she had been
involved in the employment training program for a long time
and is responsible for training in the State. She noted
that the Alaska Human Resources Council (AHREC) is
responsible for the employment and training policy in the
State of Alaska. As such, SB 252 represents an important
part of that program in assisting Alaska workers to move
into new opportunities in the work force. She encouraged
that the bill be supported and passed to the House floor.
She offered to answer questions of the Committee.
WENDY REDMAN, VICE PRESIDENT, STATEWIDE PROGRAMS, UNIVERSITY
OF ALASKA, voiced support of the legislation. She asked to
see the sunset extended and the provisions supported. The
STEP program has been an important program for many of the
community campuses at the University of Alaska.
JIM SANDERS, (TESTIFIED VIA TELECONFERENCE), offered to
answer questions of the Committee.
MARY SHIELDS, (TESTIFIED VIA TELECONFERENCE), GENERAL
MANAGER TECHNICIAL SERVICES, ANCHORAGE, voiced strong
support of the proposed legislation. She echoed comments
made by Jim Wakefield. The bill provides training in many
areas for people throughout the State, which is very
important. The STEP program is the one program that is
fully subsidized by the State and helps bring in people for
future work. She reminded members that the State is looking
forward to the gas pipeline and Alaska does not want to
bring workers in from out of state. For those people
currently working, the STEP provides an opportunity to
provide enhanced and updated skills. Mr. Shields urged that
the bill be passed from Committee.
Co-Chair Williams stated that SB 252 would be HELD in
Committee for further consideration.
#SB267
CS FOR SENATE BILL NO. 267(FIN)
An Act establishing the Alaska veterans' memorial
endowment fund and providing for credits against
certain taxes for contributions to that fund; providing
that the amount of each tax credit for contributions to
the Alaska veterans' memorial endowment fund on amounts
that do not exceed $100,000 is 50 percent and on
amounts that exceed $100,000 but do not exceed $200,000
is 75 percent; relating to other tax credits for
certain contributions; and providing for an effective
date.
Co-Chair Mulder MOVED to ADOPT the committee substitute for
CS SB 267 (FIN), #22-GS2003\J, Cook, 5/12/02. There being
NO OBJECTION, it was adopted.
MIKE TIBBLES, STAFF, REPRESENTATIVE WILLIAMS, explained that
version "J" was longer than the previous version because
some sections had been duplicated. The duplication is tied
to an effective date on Page 12. That language would repeal
and sunset all the tax credit provisions in one year.
Representative Davies asked why that action was recommended.
Co-Chair Mulder explained there have been past tax credits
for the University. He commented that the tax credit
provision becomes a "slippery slope", and that it is a
policy statement. The entity would be receiving a one-year
window before being cut off, which would protect the State.
Representative Hudson asked the page and line reference for
that determination.
Mr. Tibbles responded that Page 12, Section 28, the
effective date would be July 1,2003. That section is the
same as the one appearing in Section 27, however, has had
the tax credit provisions removed.
CAROL CARROLL, DIRECTOR, DIVISION OF SUPPORT SERVICES,
DEPARTMENT OF NATURAL RESOURCES AND MILITARY AND VETERANS
AFFAIRS, commented that the important consideration in the
bill is the endowment and getting the funds to begin the
process of maintaining the veteran's memorials. She voiced
her appreciation for the tax credit.
Representative Foster MOVED to report HCS CS SB (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal notes. There being NO OBJECTION, it was
so ordered.
HCS CS SB 267 (FIN) was reported out of Committee with a "do
pass" recommendation and with fiscal notes #1 by the
Department of Military & Veterans Affairs, #2 by the
Department of Revenue and #3 by the Department of Community
& Economic Development.
RECESS: 9:35 P.M.
RECONVENE: 10:20 P.M.
#SB252
CS FOR SENATE BILL NO. 252(RLS)
An Act renaming the Alaska Human Resource Investment
Council as the Alaska Workforce Investment Board and
relating to its membership; relating to repayment on
promissory notes for work-related items paid for by
grant programs; extending the termination date of the
state training and employment program; relating to
employment and training activities; and providing for
an effective date.
Co-Chair Mulder MOVED to ADOPT Amendment #1, #22-GS2052\P.2,
Craver, 5/11/02. Representative Croft OBJECTED.
ED FLANAGAN, COMMISSIONER, DEPARTMENT OF LABOR AND WORKFORCE
DEVELOPMENT, spoke in opposition to the amendment. He
stated that the amendment would significantly alter the
effect of the bill and jeopardize the continuance of the
STEP program.
Commissioner Flanagan noted that Senator Torgerson
established the program in SB 289 three years ago. At that
time, the Department opposed it on the bases of being an
additional diversion from the Unemployment Insurance (UI)
trust fund, impacting that fund and in the end affecting
current employee UI taxes. The bill was tied to the last
renewal of the STEP.
Commissioner Flanagan referred Committee members to the
Legislative Audit on Page 9. Funds had been deferred to the
University of Alaska, Kotzebue Technical Center, and the
Alaska Vocational Technical Center. Last year, the Galena
project was added in the House Finance Committee. He
pointed out that the audit indicated that the STEP program
was sited for reducing UI employment insurance for the UI
trust fund and has had that effect.
Commissioner Flanagan pointed out that when the Governor did
reluctantly sign SB 137, which continued the practice of not
making the funds available for competitive grants, he noted
in the transmittal letter that would be the last time that
he would sign that type legislation.
Commissioner Flanagan advised that the private sector has
testified against the amendment and in support of the
proposed bill. He urged that the Committee reject the
amendment.
Representative Croft WITHDREW his OBJECTION to Amendment #1.
There being NO further OBJECTION, the amendment was adopted.
Representative Foster MOVED to report HCS CS SB 252 (FIN)
out of Committee with individual recommendations and with
the accompanying fiscal notes. There being NO OBJECTION, it
was so ordered.
HCS CS SB 252 (FIN) was reported out of Committee with a "no
recommendation" and with Department of Labor & Workforce
Development fiscal notes #4, #5, #6, and #7.
ADJOURNMENT
The meeting was adjourned at 10:24 P.M.
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