Legislature(1993 - 1994)
03/14/1994 01:35 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE March 14, 1994 1:35 P.M. TAPE HFC 94 - 61, Side 1, #000 - end. TAPE HFC 94 - 61, Side 2, #000 - end. TAPE HFC 94 - 62, Side 1, #000 - #215. CALL TO ORDER Co-Chair Larson called the House Finance Committee meeting to order at 1:35 P.M. PRESENT Co-Chair Larson Representative Hoffman Co-Chair MacLean Representative Martin Vice-Chair Hanley Representative Navarre Representative Brown Representative Foster Representative Grussendorf Representative Therriault Representative Parnell was not present for the meeting. ALSO PRESENT Nancy Slagle, Director, Division of Budget Review, Office of Management and Budget; Mike Greany, Director, Legislative Finance Division; Jack Phelps, Staff, Representative Peter Kott. SUMMARY HB 363 An Act repealing an additional fee for motor vehicle registration not conducted by mail. CS HB 363 (FIN) was reported out of Committee with "no recommendations" and with a fiscal note by the Department of Public Safety dated 2/16/94. HB 370 An Act making appropriations for the operating and loan program expenses of state government and to capitalize funds; and providing for an effective date. HB 370 was HELD in Committee for further consideration. DISCUSSION ON THE SPENDING PLAN Co-Chair Larson provided the Committee with a handout "FY94/95 House Spending Plan". [Attachment #1]. 1 Information was compiled based on the price of oil at $13.44/bbl price which would provide unrestricted general funds of $1,677.0 billion dollars. He pointed out that FY95 expenditures would total $2,512.0 billion dollars which would be $12 million dollars higher than that initially presented by the Governor. He asked what attributed to the increase. MIKE GREANY, DIRECTOR, LEGISLATIVE FINANCE DIVISION, stated that the Governor's amendments added $3.6 million dollars. Also, there was an additional $8 million dollar reduction off-set resulting from the Aetna budget reserve which was not accounted for in the operating portion of the budget. Co-Chair Larson discussed the subcommittee closeout process. Each subcommittee chairperson will provide a letter recommending the subcommittee changes by 3/21/94 which will be distributed to all Committee and House members and the Legislative Information Offices throughout the state. A statewide teleconference will be scheduled for citizen participation followed by consideration by the full House Finance Committee. HOUSE BILL 370 "An Act making appropriations for the operating and loan program expenses of state government and to capitalize funds; and providing for an effective date." NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, offered to provide the Committee with a letter summarizing the Governor's amendments. Ms. Slagle provided a sectional analysis of HB 370, answering questions on individual sections. * Sec. 2 Mr. Greany stated that Section #2 would empower the Legislative Budget and Audit Committee to make adjustments during the year to federal funds and program receipts. * Sec. 5 Ms. Slagle noted that Section #5 applies to the social services block grant money in the Department of Health and Social Services, under Title 20. Those funds are received from the federal government as an off-set to general fund dollars. If the full amount budgeted is not received, general fund dollars would need to be adjusted. 2 * Sec. 6 Representative Navarre asked if judgments and claims paid from the state insurance catastrophe reserve account would be listed in the annual report. Ms. Slagle replied that information would be included in the catastrophe reserve account. * Sec. 8 Representative Navarre asked if a debt retirement fund had been established. Ms. Slagle stated that in Section 10 and Section 11, those funds would be appropriated out and then back into the debt retirement fund to pay the G.O. debt. She added that Section 8 would address AHFC veteran's mortgage bonds and the state's guarantee for bonds based on voter approval. * Sec.9 - Sec. 10 - Sec. 11 Representative Brown asked if the amounts appropriated in Sections 8-11 to the state bond committee were listed on the balance sheet under the $131 million dollars debt service increment. Mr. Greany advised that amount was shown in Sections 10-11 and Section 34, and added, Section 11 had been appropriated to cover the G.O. debt. * Sec. 13 Co-Chair MacLean asked the amount of funds spent on inflation proofing and the fiscal impact should that funding not be appropriated this year. Ms. Slagle advised the amount spent was $372 million dollars. Mr. Greany added that as of June lst of each year, the actual inflation proof cost is determined by the Consumer Price Index (CPI) and the inflation rate. That amount is transferred each year into the corpus of the permanent fund. * Sec. 15 Representative Hanley asked for further information on items included to the principal of the Alaska permanent fund in Section 15. * Sec. 16 Representative Martin noted that Section 16 was new and would cover the cost of fund investment. Representative Grussendorf pointed out that these costs were previously reflected in the Department of Revenue's budget. Ms. Slagle indicated OMB's intent to place Section 16 in the front 3 section of the budget as it is specifically driven by activity of the fund. Representative Brown asked if OMB could provide a front end budget total. Ms. Slagle stated that the amount requested in Section 16 would not be included in the spending plan as it is driven by the Permanent Fund Corporation and would not be identified in the general fund spending plan. She offered to provide the Committee with the proposed total. (Tape Change, HFC 94-61, Side 2). * Sec. 17 Ms. Slagle stated that Section 17 was not new and that it would address the lapsing balance of the employment assistance and training program account. Mr. Greany added that the increase would provide a specific amount. * Sec. 19 Representative Hanley asked the balance of the commercial fishing revolving loan account. Ms. Slagle advised that before the transfer occurred, there was a balance of $15,046.0 million dollars in that account. * Sec. 20 Co-Chair MacLean referenced the balance of the oil and hazardous substance release mitigation account and noted her concern with Section 20(b). She remarked that it was inequitable that above ground storage tanks were not being addressed. Representative Brown asked if the new gasoline tax proposed by the Governor would earmark funds for the purposes of Section 20. Co-Chair Larson replied that revenue generated from that source would be under $5 million dollars. Representative Therriault pointed out that the amount requested this year is above the amount which the DEC subcommittee recommended last year. * Sec. 23 Representative Martin expressed concern with the minimal funding for costs relating to the legal proceedings and audit activity involving oil and gas revenue. He urged the Committee to consider full funding of those costs. Representative Brown asked if the Department of Law would anticipate a need for double funding in FY95. Ms. Slagle advised that the full amount requested from the Department of Law for litigation procedures was $36 million dollars. 4 * Sec. 24 Representative Therriault stated that the request for fire suppression for the fiscal year ending June 30, 1994, would be an increase of $1.9 million dollars from last year's request. * Sec. 25 Representative Brown asked the current fund balance in the information services fund in the Department of Administration. Ms. Slagle offered to provide the Committee that information. * Sec. 26 Co-Chair Larson referenced the $28,715.0 million dollars appropriated the Alaska marine highway system fund and pointed out that request was 50% (percent) less than the total operational cost. * Sec. 28 Co-Chair Larson asked the difference between Section 28, the tank registration fee program and Section 20(b), the oil and hazardous substance release mitigation account. Ms. Slagle explained that Section 28 specifically addresses receipts from the tank registration fee program. * Sec. 33 Co-Chair MacLean asked the balance of the rural electrification revolving loan fund. Ms. Slagle replied that balance would be zero (0). HB 370 was HELD in Committee for further consideration. HOUSE BILL 363 "An Act repealing an additional fee for motor vehicle registration not conducted by mail." Co-Chair Larson pointed out that the House Finance Committee version of HB 363 had been withdrawn. JACK PHELPS, STAFF, REPRESENTATIVE PETER KOTT, spoke in support of the House State Affairs version of the proposed legislation. He stated that the bill would propose a $5 dollar increase and then would provide a $5 discount for those who mail in their registration. Mr. Phelps pointed out that this legislation represents the first increase to 5 motor vehicle fees since 1978. Representative Martin recommended adding the electronic means of performing business. Representative Brown pointed out that the Division of Motor Vehicles is looking for greater system efficiency through electronic mail. Mr. Phelps agreed that legislation could support the concept. Representative Brown MOVED adding language to Page 1, Line 10, after the word "mail" inserting "or electronic transmission". Representative Grussendorf asked if the Department currently has the essential equipment to provide the recommended service. Representative Martin replied that the Department is capable of handling the electronic systems, although to date they have not had the authority to provide it. Following discussion, Co-Chair Larson MOVED TO AMEND Amendment 1, following the word "mail" inserting "and may be reduced by $5 when registration is conducted by electronic transmission". Representative Navarre OBJECTED to the motion to amend Amendment #1. (Tape Change, HFC 94-62, Side 1). Representative Navarre WITHDREW THE OBJECTION to amending Amendment #1. There being NO OBJECTIONS to the main amendment, Amendment Representative Navarre pointed out that the fiscal note would not generate the amount of revenue indicated. Representative Hanley MOVED Amendment #2, #8-LS1484\K.1, Ford, 3/02/94. There being NO OBJECTION to Amendment #2, it was adopted. Representative Hanley MOVED to report CS HB 363 (FIN) out of Committee with individual recommendations and with the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CS HB 363 (FIN) was reported out of Committee with "individual recommendations" and with a fiscal note by the Department of Public Safety dated 2/16/94. ADJOURNMENT The meeting adjourned at 3:10 P.M. 6 HOUSE FINANCE COMMITTEE March 14, 1994 1:35 P.M. TAPE HFC 94 - 61, Side 1, #000 - end. TAPE HFC 94 - 61, Side 2, #000 - end. TAPE HFC 94 - 62, Side 1, #000 - #215. CALL TO ORDER Co-Chair Larson called the House Finance Committee meeting to order at 1:35 P.M. PRESENT Co-Chair Larson Representative Hoffman Co-Chair MacLean Representative Martin Vice-Chair Hanley Representative Navarre Representative Brown Representative Foster Representative Grussendorf Representative Therriault Representative Parnell was not present for the meeting. ALSO PRESENT Nancy Slagle, Director, Division of Budget Review, Office of Management and Budget; Mike Greany, Director, Legislative Finance Division; Jack Phelps, Staff, Representative Peter Kott. SUMMARY HB 363 An Act repealing an additional fee for motor vehicle registration not conducted by mail. CS HB 363 (FIN) was reported out of Committee with "no recommendations" and with a fiscal note by the Department of Public Safety dated 2/16/94. HB 370 An Act making appropriations for the operating and loan program expenses of state government and to capitalize funds; and providing for an effective date. HB 370 was HELD in Committee for further consideration. DISCUSSION ON THE SPENDING PLAN Co-Chair Larson provided the Committee with a handout "FY94/95 House Spending Plan". [Attachment #1]. Information was compiled based on the price of oil at 7 $13.44/bbl price which would provide unrestricted general funds of $1,677.0 billion dollars. He pointed out that FY95 expenditures would total $2,512.0 billion dollars which would be $12 million dollars higher than that initially presented by the Governor. He asked what attributed to the increase. MIKE GREANY, DIRECTOR, LEGISLATIVE FINANCE DIVISION, stated that the Governor's amendments added $3.6 million dollars. Also, there was an additional $8 million dollar reduction off-set resulting from the Aetna budget reserve which was not accounted for in the operating portion of the budget. Co-Chair Larson discussed the subcommittee closeout process. Each subcommittee chairperson will provide a letter recommending the subcommittee changes by 3/21/94 which will be distributed to all Committee and House members and the Legislative Information Offices throughout the state. A statewide teleconference will be scheduled for citizen participation followed by consideration by the full House Finance Committee. HOUSE BILL 370 "An Act making appropriations for the operating and loan program expenses of state government and to capitalize funds; and providing for an effective date." NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, offered to provide the Committee with a letter summarizing the Governor's amendments. Ms. Slagle provided a sectional analysis of HB 370, answering questions on individual sections. * Sec. 2 Mr. Greany stated that Section #2 would empower the Legislative Budget and Audit Committee to make adjustments during the year to federal funds and program receipts. * Sec. 5 Ms. Slagle noted that Section #5 applies to the social services block grant money in the Department of Health and Social Services, under Title 20. Those funds are received from the federal government as an off-set to general fund dollars. If the full amount budgeted is not received, general fund dollars would need to be adjusted. 8 * Sec. 6 Representative Navarre asked if judgments and claims paid from the state insurance catastrophe reserve account would be listed in the annual report. Ms. Slagle replied that information would be included in the catastrophe reserve account. * Sec. 8 Representative Navarre asked if a debt retirement fund had been established. Ms. Slagle stated that in Section 10 and Section 11, those funds would be appropriated out and then back into the debt retirement fund to pay the G.O. debt. She added that Section 8 would address AHFC veteran's mortgage bonds and the state's guarantee for bonds based on voter approval. * Sec.9 - Sec. 10 - Sec. 11 Representative Brown asked if the amounts appropriated in Sections 8-11 to the state bond committee were listed on the balance sheet under the $131 million dollars debt service increment. Mr. Greany advised that amount was shown in Sections 10-11 and Section 34, and added, Section 11 had been appropriated to cover the G.O. debt. * Sec. 13 Co-Chair MacLean asked the amount of funds spent on inflation proofing and the fiscal impact should that funding not be appropriated this year. Ms. Slagle advised the amount spent was $372 million dollars. Mr. Greany added that as of June lst of each year, the actual inflation proof cost is determined by the Consumer Price Index (CPI) and the inflation rate. That amount is transferred each year into the corpus of the permanent fund. * Sec. 15 Representative Hanley asked for further information on items included to the principal of the Alaska permanent fund in Section 15. * Sec. 16 Representative Martin noted that Section 16 was new and would cover the cost of fund investment. Representative Grussendorf pointed out that these costs were previously reflected in the Department of Revenue's budget. Ms. Slagle indicated OMB's intent to place Section 16 in the front section of the budget as it is specifically driven by 9 activity of the fund. Representative Brown asked if OMB could provide a front end budget total. Ms. Slagle stated that the amount requested in Section 16 would not be included in the spending plan as it is driven by the Permanent Fund Corporation and would not be identified in the general fund spending plan. She offered to provide the Committee with the proposed total. (Tape Change, HFC 94-61, Side 2). * Sec. 17 Ms. Slagle stated that Section 17 was not new and that it would address the lapsing balance of the employment assistance and training program account. Mr. Greany added that the increase would provide a specific amount. * Sec. 19 Representative Hanley asked the balance of the commercial fishing revolving loan account. Ms. Slagle advised that before the transfer occurred, there was a balance of $15,046.0 million dollars in that account. * Sec. 20 Co-Chair MacLean referenced the balance of the oil and hazardous substance release mitigation account and noted her concern with Section 20(b). She remarked that it was inequitable that above ground storage tanks were not being addressed. Representative Brown asked if the new gasoline tax proposed by the Governor would earmark funds for the purposes of Section 20. Co-Chair Larson replied that revenue generated from that source would be under $5 million dollars. Representative Therriault pointed out that the amount requested this year is above the amount which the DEC subcommittee recommended last year. * Sec. 23 Representative Martin expressed concern with the minimal funding for costs relating to the legal proceedings and audit activity involving oil and gas revenue. He urged the Committee to consider full funding of those costs. Representative Brown asked if the Department of Law would anticipate a need for double funding in FY95. Ms. Slagle advised that the full amount requested from the Department of Law for litigation procedures was $36 million dollars. 10 * Sec. 24 Representative Therriault stated that the request for fire suppression for the fiscal year ending June 30, 1994, would be an increase of $1.9 million dollars from last year's request. * Sec. 25 Representative Brown asked the current fund balance in the information services fund in the Department of Administration. Ms. Slagle offered to provide the Committee that information. * Sec. 26 Co-Chair Larson referenced the $28,715.0 million dollars appropriated the Alaska marine highway system fund and pointed out that request was 50% (percent) less than the total operational cost. * Sec. 28 Co-Chair Larson asked the difference between Section 28, the tank registration fee program and Section 20(b), the oil and hazardous substance release mitigation account. Ms. Slagle explained that Section 28 specifically addresses receipts from the tank registration fee program. * Sec. 33 Co-Chair MacLean asked the balance of the rural electrification revolving loan fund. Ms. Slagle replied that balance would be zero (0). HB 370 was HELD in Committee for further consideration. HOUSE BILL 363 "An Act repealing an additional fee for motor vehicle registration not conducted by mail." Co-Chair Larson pointed out that the House Finance Committee version of HB 363 had been withdrawn. JACK PHELPS, STAFF, REPRESENTATIVE PETER KOTT, spoke in support of the House State Affairs version of the proposed legislation. He stated that the bill would propose a $5 dollar increase and then would provide a $5 discount for those who mail in their registration. Mr. Phelps pointed out that this legislation represents the first increase to motor vehicle fees since 1978. 11 Representative Martin recommended adding the electronic means of performing business. Representative Brown pointed out that the Division of Motor Vehicles is looking for greater system efficiency through electronic mail. Mr. Phelps agreed that legislation could support the concept. Representative Brown MOVED adding language to Page 1, Line 10, after the word "mail" inserting "or electronic transmission". Representative Grussendorf asked if the Department currently has the essential equipment to provide the recommended service. Representative Martin replied that the Department is capable of handling the electronic systems, although to date they have not had the authority to provide it. Following discussion, Co-Chair Larson MOVED TO AMEND Amendment 1, following the word "mail" inserting "and may be reduced by $5 when registration is conducted by electronic transmission". Representative Navarre OBJECTED to the motion to amend Amendment #1. (Tape Change, HFC 94-62, Side 1). Representative Navarre WITHDREW THE OBJECTION to amending Amendment #1. There being NO OBJECTIONS to the main amendment, Amendment Representative Navarre pointed out that the fiscal note would not generate the amount of revenue indicated. Representative Hanley MOVED Amendment #2, #8-LS1484\K.1, Ford, 3/02/94. There being NO OBJECTION to Amendment #2, it was adopted. Representative Hanley MOVED to report CS HB 363 (FIN) out of Committee with individual recommendations and with the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CS HB 363 (FIN) was reported out of Committee with "individual recommendations" and with a fiscal note by the Department of Public Safety dated 2/16/94. ADJOURNMENT The meeting adjourned at 3:10 P.M. 12
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