Legislature(2011 - 2012)HOUSE FINANCE 519
02/01/2012 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| Budget Overview: Department of Law | |
| Budget Overview: Alaska Court System | |
| Budget Overview: University of Alaska | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
HOUSE FINANCE COMMITTEE
February 1, 2012
1:34 p.m.
1:34:11 PM
CALL TO ORDER
Co-Chair Stoltze called the House Finance Committee meeting
to order at 1:34 p.m.
MEMBERS PRESENT
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Co-Chair
Representative Anna Fairclough, Vice-Chair
Representative Mia Costello
Representative Mike Doogan
Representative Bryce Edgmon
Representative Les Gara
Representative David Guttenberg
Representative Reggie Joule
Representative Mark Neuman
Representative Tammie Wilson
MEMBERS ABSENT
None
ALSO PRESENT
James Cantor, Deputy Attorney General, Resources Section,
Civil Division, Department of Law; Patrick Gamble,
President, University of Alaska; Michelle Rizk, Associate
Vice President, Budget, University of Alaska; Chris
Christensen, Associate Vice President State Relations,
University of Alaska; Richard Svobodny, Acting Attorney
General, Department of Law; Doug Wooliver, Deputy
Administrative Director, Alaska Court System; Rhonda
McLeod, Fiscal Manager, Alaska Court System.
PRESENT VIA TELECONFERENCE
Kit Duke, Chief Facility Officer, University of Alaska.
SUMMARY
OPERATING BUDGET OVERVIEWS:
Department of Law
Alaska Court System
University of Alaska
^BUDGET OVERVIEW: DEPARTMENT OF LAW
1:35:04 PM
RICHARD SVOBODNY, DEPUTY ATTORNEY GENERAL, CRIMINAL
DIVISION, DEPARTMENT OF LAW provided members with a
PowerPoint presentation: Department of Law, FY 13 Budget
Overview (copy on file). He reviewed the department's
mission: The Alaska Department of Law prosecutes crime and
provides legal services to state government for the
protection and benefit of Alaska's citizens.
Mr. Svobodny noted that the department had four core
services:
· Protecting the safety and financial well-being of
Alaskans;
· Fostering conditions for responsible development of
our natural resources;
· Protecting the fiscal integrity of the state; and
· Promoting good governance.
1:37:56 PM
Mr. Svobodny observed that the Department of Law was one of
the smallest of the state's departments with 573 employees,
of which 295 are attorneys (Civil -166, Criminal - 127).
Mr. Svobodny observed that the department's FY 12 operating
budget request was $99 million; of which $2 million was for
out-side counsel on oil and gas issues. He emphasized the
importance of oil and gas issues due to the returns they
bring. The department's legal actions brought a return to
the state of $144 million in FY 12. He emphasized the
unquantifiable impact of the department's activities. There
was no way to determine the fiscal savings from child
protection.
1:39:50 PM
Mr. Svobodny observed that the department protected
citizens through prosecution of: criminal cases, felonies
(7,591), misdemeanors (22,271); child in need of aid
(1,061); and other cases (6,169). He emphasized the
importance of child in need of aid attorneys. There are 26
child protection attorneys in the state. The child
protection section had won the last 17 case before the
Supreme Court.
1:41:48 PM
Mr. Svobodny observed other means in which the department
protected citizens. He spoke to the governor's initiative
to end domestic violence and sexual assault within ten
years. He pointed out that only one cold case did not deal
with sexual assault or domestic violence. The department
had been involved in an attempt to bring new services to
victims of domestic violence and sexual assault.
1:43:09 PM
Representative Costello asked if there were a rise in gang
violence. Mr. Svobodny observed that Alaskan gangs were
primarily located in Anchorage and were less homogenous or
organized than in other states. A special group within the
Anchorage Police Department and a special lawyer in the
Anchorage District Attorney's Office were tasked with
addressing gang issues.
1:45:11 PM
Mr. Svobodny, in response to a question by Representative
Gara, explained that increased school attendance was the
best method of prevention. Children that go through school
were less likely to be offenders. He detailed the
department's efforts in other areas of the state. The
district attorneys in Bethel and Nome established a program
for dealing with truancy with the local school districts.
Kotzebue and Barrow received additional prosecutors that
were encouraged to pay attention to truancy issues. The
department attempted to develop ways to reward parents for
keeping their children in school.
1:47:55 PM
Representative Joule referred to efforts to increase
Village Public Safety Officers (VPSO) and asked if there
was correctional space for the 7,591 prosecuted felonies.
Mr. Svobodny clarified that not all the felonies cited were
charged or convicted. He referred the questions on space to
the Department of Corrections. He stressed that the per
capita crime rate had declined, as had the national trend.
Violent crimes in the state were higher than the national
average.
Co-Chair Stoltze observed that the subcommittee would look
deeper into the issue.
1:51:58 PM
Vice-chair Fairclough stressed the need to work with school
nurses in an attempt to reduce violence in schools. Mr.
Svobodny agreed.
1:53:42 PM
Mr. Svobodny noted that the Consumer Protection Unit
handled unfair business practices and had resolved consumer
complaints. The state was in litigation with 41 different
pharmaceutical companies for manipulation of the wholesale
process; some of the companies had settled; and the state
would go to trial with eight of the companies that did not
settle.
Mr. Svobodny reviewed the environmental section that dealt
with the 2006 Prudhoe Bay pipeline shutdown due to
corrosion in the pipe. The state was going to arbitration
on the resulting damages.
1:55:34 PM
Mr. Svobodny observed that more than half of the budget was
spent to promote responsible development. He referred to
Point Thomson litigation where lessees declined to produce
unit reservoirs for more than two decades. In 2005, the
state moved to terminate the Point Thomson unit and cancel
the oil and gas leases. The department was working on a
settlement. Deadline for oral argument before the Alaska
Supreme Court was scheduled for February 8.
Mr. Svobodny spoke to federal cases regarding the outer
continental shelf. He referred to the Shell Exploration
Plan for summer 2012 drilling in the Beaufort Sea case. The
federal agency, Bureau of Ocean Energy Management approved
the plan and Native and environmental groups appealed. He
added that a similar case involved Shell and ConocoPhillips
Exploration plans for the Chukchi Sea (Lease Sale 193). The
matter was being litigated, but an injunction was lifted
that allowed continuation of the project.
1:57:48 PM
Mr. Svobodny reviewed the state case on the Beaufort Sea
area wide lease sale. The state was sued by Resisting
Environmental Destruction on Indigenous Lands (REDOIL),
which sued the Department of Natural Resources over
approval of the lease sale. The state petitioned the Alaska
Supreme Court, which agreed to review the case.
1:58:39 PM
Mr. Svobodny observed that the Nunamta Aulukestai v. state
of Alaska case had a potential to make any state
development difficult. He emphasized that the case had
broader impact than just the Pebble Limited Partnership and
development of the mine. The case claimed that the
Department of Natural Resources would be in violation of
the state of Alaska Constitution if current regulations
regarding permitting were followed. The Court affirmed the
state's right to establish a permitting process in Nunamta.
The case was appealed.
2:00:05 PM
Mr. Svobodny reviewed the State v. Nondalton Tribal Council
case. The state of Alaska was sued over the area land use
plan for Bristol Bay, which they ruled had to be enacted by
regulation. The Alaska Supreme Court upheld the Department
of Natural Resources' process, as a plan to set forth the
best use of the land. A loss would have had statewide
impacts.
Mr. Svobodny observed that wetlands accounted for 43
percent of Alaska. The department was involved with the
federal Environmental Protection Agency. The U.S. Army
Corps of Engineers wanted to expand the amount of wetlands
under jurisdiction of the Clean Water Act in Alaska.
Federal interpretation would increase federal oversight.
Alaska challenged the process and criteria.
2:02:09 PM
Mr. Svobodny reviewed Tongass National Forest issues. The
forest was originally exempted from the Roadless Rule. The
U.S. District Court ruled in May 2011 that the Tongass was
not exempt from the Roadless Rule. Alaska appealed the
decision to the 9th Circuit Court of Appeals. Alaska also
filed a separate action in federal court that the Roadless
Rule was invalid
Mr. Svobodny noted that the state intervened in the court
case challenging the Logjam timber sale. The sale was
upheld and jobs were saved for Southeast residents
2:03:53 PM
Mr. Svobodny observed that the state of Alaska and John
Sturgeon challenged the National Park Service's legal
interpretation on navigable waters. The National Park
Service (NPS) claimed it could enforce federal regulations
on navigable waters within Alaska. Alaska claimed that the
Alaska National Interest Lands Conservation Act (ANILCA)
prohibited the NPS from regulating where rivers were state-
owned navigable waterways.
Co-Chair Stoltze observed that the bi-partisan, bicameral
Alaska Legislature Outdoor Heritage Caucus had circulated a
letter in support.
2:04:47 PM
Representative Wilson asked if the department had
sufficient funds to pursue additional litigation on other
issues such as Mosquito Fork. Mr. Svobodny noted that there
was $450 thousand for outside counsel that was
predominately for resource issues.
Representative Wilson noted that without state intervention
miners in her district could have more federal permitting
requirements that could put them out of business.
2:06:08 PM
Mr. Svobodny spoke to state challenges with unwarranted
listings of species as "endangered" or "threatened" and
critical habitat designations. The department had been
involved with many different species. He expressed concern
with a lack of good science and overreaching by the federal
government.
Co-Chair Stoltze indicated to the attorney general's office
that they would have sufficient resources for a seat at the
table to argue on behalf of the state with the federal
government, non-governmental organization or environmental
groups.
2:07:39 PM
Representative Guttenberg asked if there were impact on the
state's ability to defend itself since the Alaska Coastal
Management plan lapsed.
JAMES CANTOR, DEPUTY ATTORNEY GENERAL, RESOURCES SECTION,
CIVIL DIVISION, DEPARTMENT OF LAW, explained that the state
argued in the Endangered Species Act that the state had the
resources and statutes in place to protect species. The
loss of the coastal zone management program changed the
optics, but he believed the protections were still in
place.
2:09:32 PM
Mr. Svobodny stressed that the department worked to protect
the financial integrity of the state in the 1980's Carlson
case. The Carlson case was a class action lawsuit against
the Alaska Commercial Fisheries Entry Commission regarding
nonresident commercial fishermen. The legislature had
imposed an additional cost on non-resident permits.
Eventually, the Alaska Supreme Court ruled that the state
could have additional fees if they were consistent with the
additional costs to the state for regulating out-of-state
persons. The plaintiffs successfully argued that they were
charged substantially more than it cost the state and won a
judgment of a little more than $12 million. The Alaska
Supreme Court heard the case five times. The issue before
the court was the 11.5 percent punitive interest imposed
against the state, which grew to $62 million along with
attorney fees; the department argued that these should be
reduced. The legislature put the money in escrow and the
Alaska Supreme Court judged that the 11.5 percent interest
rate was excessive. The savings to the state from the
judgment was about $50 million.
2:12:38 PM
Co-Chair Stoltze provided members with a spreadsheet of
major litigation, prepared by the House Finance
Subcommittee on the Department of Law (copy on file).
Representative Gara asked if the Exxon litigation was
reopened. Mr. Cantor explained that the state submitted a
plan for restoration; it was unknown whether or not it
would be reopened.
Mr. Svobodny observed that oil, gas and mining litigation
had brought $1.95 billion to the state over ten years.
2:15:17 PM
Mr. Svobodny looked at pipeline property tax litigation.
The 2006 Trans Alaska Pipeline (TAP) litigation was on
appeal to the Alaska Supreme Court. The 2007-2009 superior
court decision regarding the valuation of the pipeline on
property taxes was favorable to the communities that
received the tax. Producers were expected to appeal. The
net benefit to the state was difficult to estimate because
as local property taxes were increased the tariff received
decreases. Another tariff issue was under ongoing
litigation: the strategic de-configuration of the pipeline.
2:17:31 PM
Representative Guttenberg referred to slide 26, state
challenges in TAPS tariffs of hundreds of millions of
dollars in imprudently incurred capital project
expenditures.
Mr. Svobodny expanded that strategic de-configuration
pertained to the owners plan to automate.
2:19:07 PM
Mr. Cantor explained that the plan went awry in its
management by "hundreds and hundreds" of percent in excess
cost above predicted. The state maintains that the project
was imprudently entered into and managed. The case just
ended, but there were weeks of presentation before the
Federal Energy Regulatory Commission and Regulatory
Commission of Alaska pertaining to the technology. Mr.
Svobodny related that mangers had a "basically grandiose"
plan to run the pipeline with only a few persons. The plans
went over cost by a huge amount. He asserted that good
business practices were not followed.
Representative Edgmon referred to the Judge Gleason's
decision. He summarized that the decision ruled that the
life of the pipeline could extend out to 2068 with 7
billion barrels of recoverable oil. He asked where the
state came down on the decision.
2:21:39 PM
Mr. Cantor explained that the board that sets the
assessment of the property tax for the pipeline came up
with a slightly lower assessment. The taxing communities
felt that the assessment should be substantially higher and
the tax payers felt it should be substantially lower. The
state's position was in the middle, which was similar to
Judge's Gleason. The state would defend Judge Gleason's
opinion.
2:24:01 PM
Mr. Svobodny noted that the state had resolved two
longstanding cases involving fiscal integrity of the state
and the wellbeing of state students. The state was sued in
Moore v. State for $1.3 billion. Plaintiffs challenged the
constitutional adequacy of rural school funding. The case
was resolved after going to trial twice with an $18 million
dollar settlement that would fund grants to the lowest
performing 40 schools in No Child Left Behind standards
exiting exams. In the long run, the decision by Judge
Gleason ruled that there was a plan that was appropriate
for rural schools, and that the legislature was
appropriating sufficient funds to pass constitutional
muster. The decision did find that the state was doing an
inadequate job of performing oversight for poor performing
schools.
2:26:07 PM
Representative Joule questioned if the ruling sufficiently
addressed preschool services. Mr. Svobodny understood the
ruling to allow children to go to kindergarten a year early
with state support of educational services. Representative
Joule reiterated his concerns. Mr. Svobodny promised to
research the matter and provide more information.
Mr. Svobodny discussed the Kasayulie v. State case, which
dealt with school construction in rural areas. The
settlement provided for five rural schools over a four year
period.
2:28:20 PM
Representative Gara expressed appreciation for the
department. He referred to federal litigation information
that was held back in the case against Senator Stevens. He
asked if the department had sent a directive to its
attorneys that holding back information would not be
tolerated. Mr. Svobodny emphasized that attorneys receive
an hour to an hour and a half of ethic's training on the
issue. Attorneys are directed to turn over any pertinent
information. He emphasized problems with the volume and
processing time of information available.
2:31:44 PM
Representative Doogan observed that the department had a $9
million increase in their FY 13 budget: $3 million addition
to the base; and $6 million for oil and gas matters. He
asked if oil and gas funding would be ongoing and
questioned if the $3 million should be added to the base.
Mr. Svobodny offered to provide additional information.
2:33:32 PM
AT EASED
2:41:19 PM
RECONVENED
^BUDGET OVERVIEW: ALASKA COURT SYSTEM
2:41:50 PM
Co-Chair Stoltze observed that Judge Carpeneti was unable
to attend, but identified three major issues: deferred
maintenance, adjusted geographical pay, and the addition of
six court clerks that would complete the "no-dark" court
room project.
2:43:22 PM
DOUG WOOLIVER, DEPUTY ADMINISTRATIVE DIRECTOR, ALASKA COURT
SYSTEM provided members with a PowerPoint presentation
(copy on file). Mr. Wooliver reviewed the Court System's
mission statement: The mission of the Alaska Court System
is to provide an accessible and impartial forum for the
just resolution of all cases that come before it, and to
decide such cases in accordance with the law, expeditiously
and with integrity.
Mr. Wooliver noted that a distinguishing characteristic of
the Alaska Court System was that it was almost entirely
state funded and unified. There were no county or municipal
courts. He maintained that a unified judiciary led to
greater efficiencies: procedurally and fiscally. He
observed that a single correctional system allowed entities
such as the Criminal Justice Working Group that work on
resolution of statewide issues. Only eight other states had
unified court systems.
2:45:34 PM
Mr. Wooliver observed that the Alaska Court System was more
like the Department of Corrections than other state
entities. Both have to respond to demand. Judges sign a pay
affidavit every pay period that nothing on their desk was
left unresolved for more than six months. Co-Chair Stoltze
interjected that the practice was voluntary and was
probably not constitutionally enforceable.
2:47:13 PM
Mr. Wooliver reviewed factors impacting workloads: increase
in population; increase in police or VPSO in communities;
varied trial rates between communities; and changes in
demographics that affect wills and probates.
2:49:13 PM
Mr. Wooliver compared caseloads in FY 10 and FY 11. Felony
cases had not changed significantly. However, domestic
violence restraining orders were up. Two-Thirds of all
cases originated in South-central Alaska:
Anchorage/Palmer/Kenai. He noted the difficulties in
finding solutions for problems in South-central that would
also work in rural areas.
2:50:40 PM
Mr. Wooliver observed that there were 800 primarily
clerical, permanent employees in 42 communities throughout
the state. There were five Supreme Court justices; 42
superior court judges in 13 communities; 23 district court
judges in 9 communities; and 43 magistrates in 27
communities. Many of the magistrate courts were just part-
time and in many cases the magistrate was the only judicial
officer in town. He observed that several of the courts
were very small, and procedures and rules needed to be
designed to work in small communities as well as large.
2:51:51 PM
Mr. Wooliver broke down the Alaska Court System's FY 12
budget:
· Personal Services Costs - 76.8%
· Services - 18.4%
· Travel Costs - 1.4% (87 percent covered jury travel)
· Supplies/Commodities - 3.1%
· Capital Outlay - .3%
2:52:55 PM
Mr. Wooliver spoke to positions funded in FY 12. Two new
superior court judges and support staff were added as a
result of the passage of SB 58. The judicial positions were
staffed by retired judges. The Alaska Judicial Council sent
13 names to the governor to fill the two new and one vacant
superior court judge positions.
Co-Chair Stoltze asked if there was a vacancy on the
Supreme Court. Mr. Wooliver acknowledged that there was a
vacancy and explained that the position was advertised. He
suspected there would be a lot of applicants. The Alaska
Judicial Council would decide how many names to forward to
the governor.
2:54:37 PM
Mr. Wooliver referred to the No Dark Courtrooms Initiative.
The last four years of the court's request for the
initiative were funded. The initiative added clerks over
several years. The final installment of six clerks was
requested for FY 13.
Mr. Wooliver spoke to items funded in the Alaska Court
System's FY 12 request. Funding was included for improved
handling of cases involving children's matters. He observed
that there a retired judge handled settlement conferences
and volunteer attorneys handled 161 cases (80 percent of
which settled). He emphasized that these types of projects
delayed the need for new judges, which were the most
expensive way to solve case management problems. Co-Chair
Stoltze interjected that these issues permeated other
departments.
2:56:39 PM
Mr. Wooliver spoke to the Alaska Court System's FY 13
funding request. The Alaska Court System requested
$2,544,500 in general funds (GF) above the FY 12 adjusted
base. The greater part was due to the final year of the No
Dark Courtrooms Initiative ($488,400). Another major factor
was the geographic differential ($436,200) to pay non-
judicial employees the same differentials paid to union
employees. The first phase was appropriated in FY 12; the
request would fund the second phase.
Mr. Wooliver noted that the Alaska Court System requested
$503,200 for maintenance items:
· Increased costs for utilities and operating leases
· Security screening cost increases
· Emmonak Courthouse Expansion ($74,500)
· Five New Positions - $545,900
o Magistrate Trainer
o Security Analyst
o Contracts and Leasing Manager
o Records Technician
o Wellness Court Probation Officer (continuation
funding)
2:58:17 PM
Representative Doogan asked if the Emmonak Courthouse would
be an expansion or new construction. Mr. Wooliver clarified
that they would most likely build a new courthouse.
Mr. Wooliver referred to the final two items in their FY 13
request:
· Computer Replacement Funding - $175,000 to
increase base funding to $600,000 goal; and
· Transfer of Therapeutic Courts Treatment Funding
- $200,000 (Convert MHTAAR Funding to GF/MH).
3:00:02 PM
Mr. Wooliver looked back at funding changes from FY 05 to
FY 13. The greatest increase had been in personal services
due to: salary adjustments, new judges (eight superior
court and three district court), and staff added for the No
Dark Courtrooms Initiative.
Mr. Wooliver noted that there was also significant increase
in services for:
· leased facility expenses,
· utility and maintenance costs,
· software support costs, and
· Therapeutic Courts in 2010 and 2011 that were
moved into the Alaska Court System.
Mr. Wooliver reiterated that the biggest change to the
Alaska Court System's budget were salary adjustments and
increments.
3:02:43 PM
Mr. Wooliver reviewed the Alaska Court System's ten-year
plan, which anticipated the ability to handle any workload
or statutory changes. There were a number or variables, but
growth was anticipated, especially in South-central Alaska.
New superior court judges might be needed for Juneau,
Bethel, and Palmer Courts, in the near term. In the long
term, new judges may be needed due to population changes in
South-central Alaska.
Mr. Wooliver referred to the Electronic Document Management
(E-Filing) Project, which would have an impact on all
justice agencies. The system would allow electronic
filings. There would be significant changes with less data
input and error. The project represents a multiyear
request. Tickets would be issued electronically, which
would save in handling. Access would be enhanced.
3:06:32 PM
Representative Doogan referred to the comment that new
superior court judges might be needed for Juneau, Bethel,
and Palmer Courts in the near term. He observed that the
population was shrinking in Juneau and questioned why a new
judge would be needed if the crime rate were tied to
population. Mr. Wooliver explained that Juneau was already
a busy court. He acknowledged that the long range view
anticipated a general decline.
Representative Costello asked for more information on the
process for filling court judge positions and why names
were forward to the governor by the Judicial Council. Mr.
Wooliver explained that the provisions were placed into the
state of Alaska's Constitution and followed the Missouri
plan. The intent was to take politics out of the process.
The council accepts names, screens and interviews
candidates, travels to communities where the vacancy was
occurring to interview members of the community, take
public testimony; make a decision and forward the
candidates that they feel would be best to the governor.
Representative Costello noted the president of the United
States did not have similar constraints. She observed the
strong powers given to the governor in other areas. She
observed that a previous governor had turned away names
submitted by the Alaska Judicial Council. Mr. Wooliver
clarified that the governor attempted to turn away the
names, but in the end had to choose from among the names
provided. He reiterated that the constitutional framers
wanted to keep a check on a strong governor with an
independent judiciary.
3:10:58 PM
Representative Costello asked if there would be a
transition into e-filing. Mr. Wooliver suggested that there
would be a long and painful transition period.
Co-Chair Stoltze expressed frustration on the process of
having appointments by the Judicial Council. He pointed out
that public members of the council are submitted by the
governor and confirmed by the legislature, but the Bar
Association just gives a list of names.
3:13:17 PM
AT EASE
3:13:27 PM
RECONVENED
Co-Chair Stoltze handed the gavel over to Vice-chair
Fairclough.
^BUDGET OVERVIEW: UNIVERSITY OF ALASKA
3:24:07 PM
PATRICK GAMBLE, PRESIDENT, UNIVERSITY OF ALASKA provided
members with a PowerPoint presentation: FY 13 Budget
Overview, House Finance Committee, February 1, 2012 (copy
on file). He observed that his job was to lay out markers
and then guide university personnel. He spoke to the
previous year's budget, which was flat with little money
for capital projects. He observed the time spent settling
into the job and ascertaining needs and legislative
directive. Now that he had time to reflect he concluded
that the university had a huge job ahead. He stressed a
complete change in direction was needed, "a rotation on its
axis": the change in the direction of a moving entity
rather than a strategic plan. He emphasized that the
university needed to be output oriented. The idea of a
return on the investment and the obligation toward the
state and students was central to the mission.
President Gamble reviewed the university's mission: The
University of Alaska (UA) inspires learning, and advances
and disseminates knowledge through teaching, research, and
public service, emphasizing the North and its diverse
peoples. He pointed out the adaptation to Alaska for
Alaska's needs had to be an underlying current.
President Gamble observed that branches of the university
were in 22 locations.
3:29:54 PM
President Gamble emphasized that there were nearly 35,000
students with 15 nationalities. In FY 11, there were three
urban campuses and dozen communities, with over 500 degrees
programs for almost 4,000 graduates.
President Gamble emphasized that the University of Alaska
was there for Alaskans and pointed to its relative
isolation, except for the "e" world. The University of
Alaska was Alaska-centric.
3:31:48 PM
President Gamble noted that the university was growing
except in the graduation rate. Improving the 27.8 percent
six-year graduation rate was one of the main tenets of the
Strategic Direction Initiative (a change in direction).
President Gamble observed that the budget he presented the
Board of Regents went through unchanged and reflected the
principle needs that the university could take on in the
near future, which included advising and research for
Alaskan issues. Only the $215 thousand for the honors
programs at the University of Alaska, Anchorage (UAA) and
University of Alaska, Fairbanks (UAF) of the Board of
Regent's request initially survived in the governor's
proposed budget. The University of Alaska successfully
argued in support of including the $547 thousand receipt
authority for the Sikuliaq research vessel's first year
operating funds. He stressed the importance of the issue.
3:34:31 PM
President Gamble mentioned that the academic portion had a
0.01 percent increment increase. The university was in the
process of figuring out how it could reorient or return to
argue for programs that were not funded by the governor.
The Board of Regent's request was reduced by $6.1 million
for programs.
President Gamble reviewed cost saving initiatives that were
instituted by the university. The University of Alaska:
· Internalized increased costs in its employee health
plan at 7 million;
· Consolidated and reduced cost in executive staff (the
president's office was reduced from 9 to 4);
· Completed a dependent audit to assess how many people
in the health program were ineligible, which resulted
in an estimated savings of $470,000;
· Reduced energy consumption; and
· Reduced travel through added video conferencing that
saved $500 thousand.
3:37:24 PM
President Gamble observed that $3 million of the $6 million
requested for programs was for education and training in
high demand jobs. He linked high demand jobs with a salary
matrix and observed that those with masters show anomalies
in terms of high salaries.
President Gamble looked at economic development and
intellectual property. He noted the number of initiatives
and patents being sought through the UAF Office of
Intellectual Property and Commercialize. He added that UAA
had just started an office. The university had requested
seed money, which was denied.
3:40:26 PM
President Gamble reviewed the capital budget. Deferred
maintenance was the number one priority of the university
and board. A hundred million dollar bond proposal request
was reduced to $50 million in FY 12. He emphasized the need
for more. He explained that renewal and repurposing (R&R)
referred to the step before deferred maintenance and
stressed its importance and possible savings. The FY 12
request for R&R was $50 million, which was the number
needed to maintain buildings from year to year; the
university received $2 million. He stressed that unfunded
R&R turns into deferred maintenance costs. The governor's
request contains $37.5 million, which would not work for
both: R&R and deferred maintenance. The university
requested $202.2 million, which was not included in the
governor's request.
President Gamble observed that the university's annual
operating budget was $30 - $32 million.
3:43:38 PM
President Gamble reviewed slide 14, FY Sustainment Funding
Plan for University of Alaska (UA) facilities and continued
to speak to sustainment needs. He observed that short
funding of R&R and deferred maintenance in FY 12 shifted
the date by which sustainment could be met. The line is
currently at 2018; had they received their full funding
request in FY 12, the date would be 2016. He observed that
the university was approaching $800 million in deferred
maintenance needs.
President Gamble summarized that no money was requested for
planning or new buildings. The request only included
funding for R&R and deferred maintenance, which were not
included in the governor's proposed budget. The university
only received federal capital receipt authority that would
allow movement of funds internally. He indicated that the
lack of funding for R&R and deferred maintenance backlog
would extend the costs into the future.
3:46:26 PM
President Gamble emphasized that FY 12 federal and state
funding was put to use immediately and that there were a
lot of projects underway.
President Gamble stressed the need for a programmatic
solution to acquiring annual funds for real property
maintenance, R&R and deferred maintenance reduction before
there was mission failure. "Mission failure is when
students can't go into a class and sit down and learn or
get on line and learn because something is broken down."
3:48:22 PM
President Gamble spoke to research for Alaska. The
university's research request was "healthy" and focused on
Alaska specific answers to Alaska's specific questions or
complimentary programs that the federal government was
seeking in regards to concerns about the oceans or Arctic,
where Alaska was in the middle of the controversy.
3:49:38 PM
President Gamble stressed that the University of Alaska's
research had been recognized by outside groups as cutting
edge. The federal government was interested in UA research.
The state request emphasized complimentary dollars for
federal funding or to compliment federal research.
3:51:04 PM
President Gamble pointed out that indirect cost recovery
sat on top of a grant that the university received.
Flexibility was needed to support grants where funding for
items outside the grant was needed and for overhead, which
is high.
3:52:27 PM
President Gamble referred to Alaskan challenges that were
not as desperate as other states. The UA was flattening
out. The slope of the curve had been lowered from the
growth phase of 12 and 14 percent annually. The university
was below the state average in growth. He stressed that the
university's facilities were aging out, but closure was not
an option. He asked the question: If we are Alaska's
university, what does Alaska want. Enrollment was still
growing, but graduation rates were not high enough. There
was an expansive degree program. He questioned demand and
pointed out that the university cannot be everything for
everyone, which was a sensitive cultural issue. Health care
costs were unsustainable.
3:55:19 PM
President Gamble maintained that there was a limited
solution set to challenges. He emphasized the limit for
tuition increases. Funding would have to come from sources
outside of tuition: program reductions, class size changes,
facility closures, new revenue sources. He pointed out that
grants could be written to support academic programs not
just for research. The university had received a $15
million federal matching grant for teacher mentoring; the
UA match was $1.5 million. He stressed the importance of
teacher mentoring. The grant went to the four biggest
school districts in Alaska. He reiterated the need to
increase graduation rates. Workload increases were seen. He
observed the need to balance research and classroom time.
3:58:39 PM
President Gamble maintained the need for a Strategic
Direction Initiative (SDI) that was output and student
oriented, and eliminated hurdles. Communities, students,
staff and faculty were canvassed.
4:00:16 PM
Co-Chair Thomas referred to the research vessel that was
targeted for Seward. He pointed out that the National
Oceanographic and Atmospheric Agency (NOAA) facility was
built in Juneau and asked why the two could not be combined
to maximize research potential. He did not understand why
the university would have its scientist at two ends of
Alaska.
4:02:09 PM
President Gamble observed that the "heart of the target"
was the three critical years: senior year of high school
and first two years of college. He acknowledged student
concerns regarding credit transfer. Graduation rates were
seen as a business initiative that needed to improve.
Increased graduation rates would lower the cost per
graduate and their debt. He stressed the lack of advisers
to provide comprehensive advice. The university proposed a
major program to improve advising that was not included in
the governor's base.
4:04:54 PM
President Gamble reviewed slide 26, Stay on Track. Stay on
Track would urge students to focus on graduation. There was
no capacity to advice students based on financials. Many
degree programs took more than 120 credit hours. The
university was reviewing degrees to bring them to 120
hours.
Representative Gara leaned toward the Board of Regents'
request. He asked if engineering work could be done without
a new building. He indicated that instructional money would
be more successful without the need for building
commitments.
President Gamble acknowledged a growth in the demand for
engineering classes that was inhibited by facilities that
were not keeping up with the quality necessary to graduate
engineers. The technology of engineering laboratories was
outdated. While laboratories could be refurnished, the
floor space was inadequate. He observed that the cost for
a new engineering building at $200 million. However,
deferred maintenance was seen as the bigger issue.
Expansion of the engineering program remains the number one
academic issue priority.
4:10:15 PM
Representative Doogan asked why UA deferred maintenance was
such a problem. President Gamble explained that new
buildings during the growth phase were accompanied by
operation and maintenance funding. He could not answer why
there was a deferred maintenance problem, but pointed out
that the problem is systemic in the country. He stressed
that the university was not that bad off and could get
ahead before drastic measures were necessary. He discussed
the power plant in Fairbanks, which presented an expensive
dilemma. He observed that deferred maintenance costs were
lower at UAA than UAF because the buildings were newer.
Representative Doogan asked for a written explanation on
"how all of these chickens are coming to roost at roughly
the same time" and why deferred maintenance was not upheld.
4:14:42 PM
Vice-chair Fairclough observed that a large deferred
maintenance request that had not been funded in the prior
year.
Representative Guttenberg pointed to slide 26 and wondered
why students were taking part-time credits. President
Gamble answered that students were encouraged to take part-
time courses in order for them to determine their interest
before committing to a full-time schedule. The university
had emphasized the benefit of taking 15 credits hours.
4:18:09 PM
Representative Guttenberg pointed to the national dialogue
related to the value of a college education. He wondered
whether there was a lack of student understanding due to
insufficient counselors. President Gamble suggested that
technology would improve data delivery, which would free
counselors to intervene on problems and allow students to
make educated decisions.
Representative Costello thanked President Gamble for
including the honors program in the university's base
budget. She maintained that all students deserve the same
level of opportunity.
ADJOURNMENT
4:23:33 PM
The meeting was adjourned at 4:23 PM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Court-HFIN Budget Overview FY13-020112.pdf |
HFIN 2/1/2012 1:30:00 PM |
|
| University-HFIN Budget FY13- Overview.pdf |
HFIN 2/1/2012 1:30:00 PM |
|
| dept of law HFIN-Buget Overview- fy 13-020112pdf.pdf |
HFIN 2/1/2012 1:30:00 PM |
|
| LAW Oil-Gas Major Litigation-Stoltze Handout HFIN 2-1.pdf |
HFIN 2/1/2012 1:30:00 PM |
|
| LAW-HFIN Overview Response.pdf |
HFIN 2/1/2012 1:30:00 PM |