Legislature(2005 - 2006)

05/02/2005 02:33 PM FIN


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                  HOUSE FINANCE COMMITTEE                                                                                       
                        May 2, 2005                                                                                             
                         2:33 p.m.                                                                                              
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Meyer called the House  Finance Committee meeting to                                                                   
order at 2:33:28 PM.                                                                                                          
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Mike Chenault, Co-Chair                                                                                          
Representative Kevin Meyer, Co-Chair                                                                                            
Representative Bill Stoltze, Vice-Chair                                                                                         
Representative Eric Croft                                                                                                       
Representative Richard Foster                                                                                                   
Representative Mike Hawker                                                                                                      
Representative Jim Holm                                                                                                         
Representative Reggie Joule                                                                                                     
Representative Mike Kelly                                                                                                       
Representative Carl Moses                                                                                                       
Representative Bruce Weyhrauch                                                                                                  
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Senator  Ralph  Seekins;  Brian Hove,  Staff,  Senator  Ralph                                                                   
Seekins;  Kelly Hepler,  Director,  Division  of Sport  Fish,                                                                   
Department  of  Fish  and  Game;  Devon  Mitchell,  Executive                                                                   
Director,  Alaska Municipal Bond  Bank Authority,  Department                                                                   
of Revenue;  Doug Letch,  Staff, Senator  Gary Stevens;  Jeff                                                                   
Ottensen,   Director,   Division  of   Program   Development,                                                                   
Department  of  Transportation  and  Public  Facilities;  Tom                                                                   
Maher,  Staff,   Senator  Gene   Therriault;  Pat   Davidson,                                                                   
Legislative  Auditor,  Legislative  Audit  Division;  Senator                                                                   
Gene Therriault;  Chuck Harlamert, Revenue  Audit Supervisor,                                                                   
Tax  Division, Department  of Revenue;  Rick Urion,  Director                                                                   
Occupational Licensing, Department  of Community and Economic                                                                   
Development; Jim  Preston, Juneau; Pat Davidson,  Legislative                                                                   
Auditor, Legislative  Audit Division; Dave  Stancliff, Staff,                                                                   
Senator   Gene  Therriault;   Melanie   Millhorn,   Director,                                                                   
Division   of   Retirement  and   Benefits,   Department   of                                                                   
Administration;  Speaker  John  Harris;  Representative  Paul                                                                   
Seaton,  Representative  Jay Ramras;  Senator  John  Coghill;                                                                   
Representative Beth Kerttula                                                                                                    
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Gordon  Garcia,  Project  Manager, Division  of  Sport  Fish,                                                                   
Department  of   Fish  and   Game;  Ricky  Gease,   Executive                                                                   
Director, Kenai River Sportfishing                                                                                              
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
CSSB 147(FIN)                                                                                                                   
          "An  Act providing  for  a sport  fishing  facility                                                                   
          surcharge on sport fishing  licenses; providing for                                                                   
          the  construction  and  renovation of  state  sport                                                                   
          fishing   facilities   and   for   other   projects                                                                   
          beneficial  to  the  sport fish  resources  of  the                                                                   
          state as  a public enterprise; and  authorizing the                                                                   
          issuance   of  revenue   bonds  to  finance   those                                                                   
          projects."                                                                                                            
                                                                                                                                
          HCSSB 147 (FIN) was  REPORTED out of Committee with                                                                   
          a  "no  recommendation"   recommendation  and  with                                                                   
          three fiscal  impact notes: #1 REV, #2  DFG, and #3                                                                   
          DFG.                                                                                                                  
                                                                                                                                
CSSSSB 16(TRA)                                                                                                                  
          "An Act  relating to the  powers and duties  of the                                                                   
          Department    of    Transportation    and    Public                                                                   
          Facilities;  repealing the requirement for  a long-                                                                   
          range   program   for  highway   construction   and                                                                   
          maintenance;  and  repealing   a  requirement  that                                                                   
          public  facilities  comply  with  energy  standards                                                                   
          adopted  by the  Department  of Transportation  and                                                                   
          Public Facilities;  and providing for  an effective                                                                   
          date."                                                                                                                
                                                                                                                                
          CSSSSB 16 (TRA) was  REPORTED out of Committee with                                                                   
          a  "do  pass"  recommendation  and  with  two  zero                                                                   
          fiscal impact notes: #1 DOT, #2 DPS.                                                                                  
                                                                                                                                
CSSB 139(L&C)                                                                                                                   
          "An  Act relating to  termination and  oversight of                                                                   
          boards,    commissions,   and   agency    programs;                                                                   
          extending  the  termination date  of  the Board  of                                                                   
          Marital  and Family Therapy;  and providing  for an                                                                   
          effective date."                                                                                                      
                                                                                                                                
          HCSSB  139 (L&C)  was heard  and HELD in  Committee                                                                   
          for further consideration.                                                                                            
                                                                                                                                
SJR 11    Urging the United States Congress to amend the tax                                                                    
          code   to  repeal   the  federal   excise  tax   on                                                                   
          communications.                                                                                                       
                                                                                                                                
          SJR 11 was REPORTED out of Committee with a "do                                                                       
          pass" recommendation  and with a zero fiscal impact                                                                   
          note by the Department of Revenue.                                                                                    
                                                                                                                                
CSSB 141(FIN)                                                                                                                   
          "An  Act  relating  to  the  teachers'  and  public                                                                   
          employees' retirement  systems and creating defined                                                                   
          contribution  and  health reimbursement  plans  for                                                                   
          members of the teachers'  retirement system and the                                                                   
          public employees'  retirement system who  are first                                                                   
          hired  after July 1,  2005; relating to  university                                                                   
          retirement   programs;   establishing  the   Alaska                                                                   
          Retirement  Management Board to replace  the Alaska                                                                   
          State   Pension   Investment  Board,   the   Alaska                                                                   
          Teachers'   Retirement   Board,   and  the   Public                                                                   
          Employees' Retirement  Board; adding appeals of the                                                                   
          decisions  of the  administrator  of the  teachers'                                                                   
          and  public employees'  retirement  systems to  the                                                                   
          jurisdiction   of  the  office  of   administrative                                                                   
          hearings;  providing for  nonvested members  of the                                                                   
          teachers'  retirement system defined  benefit plans                                                                   
          to  transfer into the  teachers' retirement  system                                                                   
          defined   contribution  plan   and  for   nonvested                                                                   
          members of the public  employees' retirement system                                                                   
          defined benefit  plans to transfer into  the public                                                                   
          employees'  retirement system defined  contribution                                                                   
          plan;  providing  for  political  subdivisions  and                                                                   
          public organizations  to request to  participate in                                                                   
          the   public   employees'    defined   contribution                                                                   
          retirement  plan; and  providing  for an  effective                                                                   
          date."                                                                                                                
                                                                                                                                
          HCSSB 141 (FIN) was REPORTED out of Committee with                                                                    
          a  "no recommendation"  with  the following  fiscal                                                                   
          impact notes:  #1 ADM, #3  REV, #4 REV, #5  REV, #6                                                                   
          REV, #7 REV, #9 FIN.                                                                                                  
                                                                                                                                
2:35:03 PM                                                                                                                    
CS FOR SENATE BILL NO. 141(FIN)                                                                                               
                                                                                                                                
     "An Act relating to the teachers'  and public employees'                                                                   
     retirement  systems  and creating  defined  contribution                                                                   
     and  health  reimbursement  plans  for  members  of  the                                                                   
     teachers'  retirement system  and the public  employees'                                                                   
     retirement  system who  are  first hired  after July  1,                                                                   
     2005;  relating   to  university  retirement   programs;                                                                   
     establishing the  Alaska Retirement Management  Board to                                                                   
     replace the  Alaska State Pension Investment  Board, the                                                                   
     Alaska  Teachers'  Retirement   Board,  and  the  Public                                                                   
     Employees'  Retirement  Board;  adding  appeals  of  the                                                                   
     decisions  of the  administrator  of  the teachers'  and                                                                   
     public    employees'   retirement    systems   to    the                                                                   
     jurisdiction of  the office of administrative  hearings;                                                                   
     providing  for   nonvested  members  of   the  teachers'                                                                   
     retirement  system  defined  benefit plans  to  transfer                                                                   
     into   the    teachers'   retirement    system   defined                                                                   
     contribution  plan  and  for nonvested  members  of  the                                                                   
     public  employees'  retirement  system  defined  benefit                                                                   
     plans to transfer into the  public employees' retirement                                                                   
     system   defined   contribution  plan;   providing   for                                                                   
     political  subdivisions   and  public  organizations  to                                                                   
     request to participate in  the public employees' defined                                                                   
     contribution  retirement  plan;  and  providing  for  an                                                                   
     effective date."                                                                                                           
                                                                                                                                
Co-Chair  Meyer noted  that the Committee  would discuss  the                                                                   
fiscal  impact of  the  amendments  to SB  141  later in  the                                                                   
meeting.                                                                                                                        
                                                                                                                                
Representative   Croft   asked  for   an   analysis  of   the                                                                   
Committee's previous action and  suggested that the Committee                                                                   
check to  be sure that  the pensions  are not over  or under-                                                                   
funded.                                                                                                                         
                                                                                                                                
SB 141 was held till later in the meeting.                                                                                      
2:37:33 PM                                                                                                                    
^                                                                                                                               
CONFLICT OF INTEREST                                                                                                            
                                                                                                                                
Co-Chair Meyer  read a  legal analysis regarding  declaration                                                                   
of conflicts of interest (copy on file.)                                                                                        
                                                                                                                                
Representative  Weyhrauch summarized  that members  may chose                                                                   
to declare  a conflict of interest,  but are not  required to                                                                   
do so. He stated  that he would continue his  practice of not                                                                   
declaring  conflicts   of  interest  on  issues   before  the                                                                   
Committee.                                                                                                                      
                                                                                                                                
Vice-Chair Meyer requested that  members reframe from stating                                                                   
conflict of interests at the committee level.                                                                                   
                                                                                                                                
2:40:06 PM                                                                                                                    
                                                                                                                                
CS FOR SENATE BILL NO. 147(FIN)                                                                                               
                                                                                                                                
     "An  Act   providing  for   a  sport  fishing   facility                                                                   
     surcharge on  sport fishing licenses; providing  for the                                                                   
     construction  and  renovation  of  state  sport  fishing                                                                   
     facilities  and  for other  projects  beneficial to  the                                                                   
     sport  fish   resources  of   the  state  as   a  public                                                                   
     enterprise;  and  authorizing  the issuance  of  revenue                                                                   
     bonds to finance those projects."                                                                                          
                                                                                                                                
Representative Holm  noted that the companion bill  to SB 147                                                                   
is HB  252 [sponsored by  Representative Holms]. He  spoke in                                                                   
support of the legislation.                                                                                                     
                                                                                                                                
SENATOR   RALPH   SEEKINS,  SPONSOR,   explained   that   the                                                                   
legislation  would  provide  a  sport  fishery  surcharge  to                                                                   
reconstruct and  construct new  sport fish hatcheries  in the                                                                   
state  and   enhance  or  expand  the   recreational  fishing                                                                   
opportunities around the state.                                                                                                 
                                                                                                                                
     Alaska has an ever-growing  demand for fish stocks. More                                                                   
     people want  to fish. Resident populations  are growing.                                                                   
     Tourist   demand   for   recreational   opportunity   is                                                                   
     increasing.   And,  at   the  same   time,  sport   fish                                                                   
     production  is  decreasing.  Alaska's  only  sport  fish                                                                   
     hatcheries are  located at Ft. Richardson  and Elmendorf                                                                   
     A.F.B. Both are  more than 30 years old  and nearing the                                                                   
     end of their useful life.                                                                                                  
                                                                                                                                
     To  make matters  worse,  biomass  production will  soon                                                                   
     plummet.  Hatcheries  require   warm  water  to  enhance                                                                   
     growth in baby fish. Waste  heat from the Ft. Richardson                                                                   
     and Elmendorf power plants  has provided that energy for                                                                   
     many years. Both power plants  will be shutting down hot                                                                   
     water  production  in  October.  As  a  result,  biomass                                                                   
     production  will suffer  greatly at  the same time  that                                                                   
     demand is increasing.                                                                                                      
                                                                                                                                
     We  can fix this  problem  and plan for  years to  come.                                                                   
     Senate  Bill   147  provides  for  the   renovation  and                                                                   
     expansion   of   the  Ft.   Richardson   and   Elmendorf                                                                   
     facilities to meet south  central needs. Furthermore, it                                                                   
     will  also provide for  a new  hatchery in Fairbanks  to                                                                   
     meet  the demands  of the  interior regions.  (Currently                                                                   
     hatchery  fish  are  trucked from  Richardson  into  the                                                                   
     interior for planting.)                                                                                                    
                                                                                                                                
     It won't  be cheap but  it is affordable.  Federal funds                                                                   
     have  been  procured to  meet  increased  demand due  to                                                                   
     military expansion.                                                                                                        
Senator Seekins  observed that  there are some  environmental                                                                   
problems in  the Fairbanks  area that can  be cured  by using                                                                   
hot water  from the Chena  V power plant.  Some of  the BTU's                                                                   
can be taken  out of the  water before it is  discharged back                                                                   
into the  river. Educational  facilities with the  University                                                                   
of Alaska  School of  fisheries can  be enhanced and  visitor                                                                   
facilities created for school  aged kids. He anticipated that                                                                   
Senator Stevens would  be able to provide $10  million toward                                                                   
this effort.                                                                                                                    
                                                                                                                                
Senator Seekins  observed that  a new fish hatchery  building                                                                   
with a  salmon modular would be  built at Ft.  Richardson. He                                                                   
observed that  95 percent of the  fish from this would  go to                                                                   
sport  fisheries. He  emphasized that  the legislation  would                                                                   
allow   the  conversion   of  fishing   into  catching.   The                                                                   
facilities would be expandable for up to 20 - 25 years.                                                                         
                                                                                                                                
Senator Seekins explained that  once the bonding mechanism is                                                                   
paid off the  surcharge would end. Every dollar  earned would                                                                   
go to pay down the indebtedness.                                                                                                
                                                                                                                                
Senator   Seekins  stressed   the   statewide  benefit.   The                                                                   
Wrangell/Petersburg Crystal Lake  Hatchery would receive $2.5                                                                   
million;  the   Sitka/Haines  hatchery  would   receive  $1.5                                                                   
million; and the Skagway hatchery would receive $1.6.                                                                           
                                                                                                                                
2:47:17 PM                                                                                                                    
                                                                                                                                
Co-Chair Chenault  asked where  the fish are deposited  after                                                                   
they are reared.  Senator Seekins explained that  the fish go                                                                   
into the  lakes and streams  of the interior,  Kodiak Island,                                                                   
the Kenai Peninsula, and through South Central Alaska.                                                                          
                                                                                                                                
2:48:29 PM                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze  asked if inclusion  of game  licenses was                                                                   
discussed. Senator Seekins explained  that game licenses were                                                                   
included  in  SB  170.  He  observed   that  there  has  been                                                                   
indication  that  the public  would  support  an increase  in                                                                   
hunting licenses  if there is a greater opportunity  to bring                                                                   
something home.                                                                                                                 
                                                                                                                                
Vice-Chair Stoltze noted that  the Susitna Advisory Board has                                                                   
shown some  support for the  legislation and suggested  a fee                                                                   
increase  of $5.00.  Senator Seekins  observed that  deposits                                                                   
into the  Fish and Game  Fund must be  sufficient to  pay off                                                                   
the indebtedness.  The initial  figure was $7.50.  The charge                                                                   
was increased to  $8.50 to cover the additional  $5.5 million                                                                   
that went into Southeast Alaska.  He termed it a user-benefit                                                                   
surcharge.                                                                                                                      
                                                                                                                                
2:52:18 PM                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze referred to  legislation, which would name                                                                   
the Fairbanks hatchery after Ruth Burnette.                                                                                     
                                                                                                                                
Representative  Weyhrauch explained  that the only  complaint                                                                   
he has received  is that the $8.50 fee would  require vendors                                                                   
to carry change. He suggested  an amendment to round down the                                                                   
amount to  $8.00 in order to  eliminate the need  for change.                                                                   
Senator Seekins questioned if  the reduction would jeopardize                                                                   
the bond  issues and prevent  fully-funding the  projects. He                                                                   
suggested rounding  it off to $9.00 if the  bonding authority                                                                   
felt it was necessary.                                                                                                          
                                                                                                                                
Representative Kelly  WITHDREW Amendment 1, which  would have                                                                   
lowered the amount to $7.50.                                                                                                    
                                                                                                                                
2:56:24 PM                                                                                                                    
                                                                                                                                
JIM PRESTON, JUNEAU, spoke as  a charter operator and license                                                                   
vendor. He testified in support  of the proposed amendment by                                                                   
Representative Weyhrauch,  which would eliminate  the need to                                                                   
carry quarters  around. He argued  for "whole  dollar amount"                                                                   
fees. He spoke in support of SB 147.                                                                                            
                                                                                                                                
3:00:08 PM                                                                                                                    
                                                                                                                                
RICKY GEASE,  EXECUTIVE DIRECTOR,  KENAI RIVER  SPORTFISHING,                                                                   
testified  in support  of SB  147.  He stressed  the need  to                                                                   
upgrade the hatcheries and note  that demand on the fisheries                                                                   
is  growing.   He  agreed  that   the  surcharge   should  be                                                                   
eliminated after the bond is paid.                                                                                              
                                                                                                                                
3:01:28 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Stoltze asked if  limiting set  nets or  the bill                                                                   
would provide the most benefit. Mr. Gease answered both.                                                                        
                                                                                                                                
Co-Chair  Chenault  asked  for  Mr. Gease's  opinion  on  the                                                                   
rounding up or down to a whole  number. Mr. Gease stated that                                                                   
he would support, whichever amount supported the proposal.                                                                      
                                                                                                                                
3:02:48 PM                                                                                                                    
                                                                                                                                
Representative Weyhrauch MOVED to ADOPT Amendment 2:                                                                            
                                                                                                                                
     Page 3, lines 23, 24, 25                                                                                                   
     Delete $8.50                                                                                                               
     Insert $8.00                                                                                                               
                                                                                                                                
     Page 3, line 29                                                                                                            
     Delete $8.50                                                                                                               
     Insert $10.00                                                                                                              
                                                                                                                                
Co-Chair Meyer OBJECTED.                                                                                                        
                                                                                                                                
Representative   Weyhrauch  reiterated   his  reasoning   and                                                                   
requested comments from Mr. Mitchell.                                                                                           
                                                                                                                                
3:04:15 PM                                                                                                                    
                                                                                                                                
DEVON  MITCHELL, EXECUTIVE  DIRECTOR,  ALASKA MUNICIPAL  BOND                                                                   
BANK  AUTHORITY,  DEPARTMENT  OF REVENUE,  related  that  the                                                                   
fiscal note  by the department  contemplated a  20-year bond.                                                                   
He felt  that the  legislation allowed  flexibility  and zero                                                                   
impact would be easy to manage.                                                                                                 
                                                                                                                                
Representative  Croft opined  that the  numbers are  slightly                                                                   
positive.                                                                                                                       
                                                                                                                                
3:05:47 PM                                                                                                                    
                                                                                                                                
Mr. Mitchell had  not examined the numbers by  the Department                                                                   
of  Fish and  Game.  He noted  that if  there  is a  positive                                                                   
impact that it is the sponsor's intent return any funds.                                                                        
                                                                                                                                
3:06:47 PM                                                                                                                    
                                                                                                                                
Representative Hawker inquired  if the extra revenue would be                                                                   
dedicated  to  early retirement  of  the debt.  Mr.  Mitchell                                                                   
agreed and  clarified that  the intent  is to accelerate  the                                                                   
debt  repayment  and  shorten  the  schedule.  Representative                                                                   
Hawker spoke in support of increasing $8.50 to $9.00.                                                                           
                                                                                                                                
3:08:20 PM                                                                                                                    
                                                                                                                                
Mr. Mitchell  noted that  the Department  of Fish and  Game's                                                                   
fee collection  has been growing.  The amounts  suggested are                                                                   
based on current numbers, not projected numbers.                                                                                
                                                                                                                                
Representative Weyhrauch  suggested Representative  Holm make                                                                   
a friendly amendment as such.                                                                                                   
                                                                                                                                
3:09:47 PM                                                                                                                    
                                                                                                                                
Representative   Holm  offered   a   friendly  amendment   to                                                                   
Amendment 2, changing $8.00 to  $9.00 on page 3, lines 23-25.                                                                   
                                                                                                                                
Representative Weyhrauch  restated the friendly  amendment to                                                                   
Amendment 2.                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze and Co-Chair Chenault OBJECTED.                                                                              
                                                                                                                                
3:12:56 PM                                                                                                                    
                                                                                                                                
Mr. Mitchell  pointed out  that page  4, line  1 and  2 would                                                                   
also  need to be  changed  if the intent  is to  go to  whole                                                                   
numbers.                                                                                                                        
                                                                                                                                
Representative  Croft observed that  the other cites  are for                                                                   
non-resident military fishing  and small game licenses, which                                                                   
would  have a  small  impact. He  suggested  sticking to  the                                                                   
lower number  of $8.00  for these uses.  He also  asked about                                                                   
the implications of the Carlson Case.                                                                                           
                                                                                                                                
3:15:32 PM                                                                                                                    
                                                                                                                                
KELLY HEPLER,  DIRECTOR, DIVISION  OF SPORT FISH,  DEPARTMENT                                                                   
OF FISH AND  GAME, addressed the Carlson case,  which applies                                                                   
to  commercial issues.  He  did  not feel  there  would be  a                                                                   
problem.                                                                                                                        
                                                                                                                                
3:16:47 PM                                                                                                                    
                                                                                                                                
Representative  Croft asked  for  more information  regarding                                                                   
the use of  the Fairbanks hatchery stock. Mr.  Hepler related                                                                   
that  the  two  hatcheries,  Ft.  Richardson  and  Elmendorf,                                                                   
provide all of the stock for Homer  to the Alaskan range. The                                                                   
new hatchery  is proposed  in Fairbanks to  take care  of the                                                                   
Interior  needs.   The  Ft.  Richardson  hatchery   would  be                                                                   
refurbished to take  care of area south of  the Alaskan range                                                                   
to Kodiak.                                                                                                                      
                                                                                                                                
Vice-Chair Stoltze inquired how  long this surcharge would be                                                                   
in  place. Mr.  Mitchell  replied that  the  fiscal note  was                                                                   
based  on 20  year  leveraging. He  estimated  that the  term                                                                   
could be shortened to 17 years or less.                                                                                         
                                                                                                                                
In  response to  a question  by  Representative Stoltze,  Mr.                                                                   
Hepler explained  that the Ft.  Richardson hatchery  would be                                                                   
located  on  a  former  Air  Force  Base  facility,  with  no                                                                   
practical public access. The facility  will be for production                                                                   
only; there would  not be anything fancy about  the facility.                                                                   
The Fairbanks  facility would be built for  production. There                                                                   
have been  discussions  of additional  money that would  make                                                                   
the  facility  more  "pleasing   to  the  eye",  but  without                                                                   
becoming  a  visitor  center.  There  have  been  discussions                                                                   
regarding housing  at Ft. Richardson,  similar to what  is at                                                                   
Fairbanks.                                                                                                                      
                                                                                                                                
3:21:05 PM                                                                                                                    
                                                                                                                                
GORDON  GARCIA,  PROJECT  MANAGER, DIVISION  OF  SPORT  FISH,                                                                   
DEPARTMENT OF FISH  AND GAME, described the  facility and the                                                                   
attempt  to  reduce  costs.  He   noted  that  the  Fairbanks                                                                   
facility has  been scaled  back to  reduce costs. The  amount                                                                   
raised through the legislation would fund the building.                                                                         
                                                                                                                                
3:21:39 PM                                                                                                                    
                                                                                                                                
Mr.  Mitchell  noted that  there  is  a dedicated  fund  that                                                                   
cannot crossover into other needs.                                                                                              
                                                                                                                                
3:22:11 PM                                                                                                                    
                                                                                                                                
Vice-Chair   Stoltze  expressed   concern  that  the   angler                                                                   
surcharges not be used to pay for any "grand ideas".                                                                            
                                                                                                                                
3:23:28 PM                                                                                                                    
                                                                                                                                
Mr.  Hepler   emphasized  that   the  facility  would   be  a                                                                   
production facility.  He stressed that without  fish there is                                                                   
no hatchery.                                                                                                                    
                                                                                                                                
3:24:24 PM                                                                                                                    
                                                                                                                                
Representative  Kelly summarized  that the  amendment to  the                                                                   
amendment is to lower the fee to $8.00.                                                                                         
                                                                                                                                
Representative  Croft  clarified that  the  amendment to  the                                                                   
amendment would  take the fee  to $9.00. His  objection would                                                                   
leave it at $8.00.                                                                                                              
                                                                                                                                
3:25:39 PM                                                                                                                    
                                                                                                                                
Co-Chair  Chenault observed  that $9.00  would provide  $2.47                                                                   
million more that the original proposal.                                                                                        
                                                                                                                                
3:26:37 PM                                                                                                                    
                                                                                                                                
Representative  Holm observed  that the  concern is  that the                                                                   
amount  be whole,  but  emphasized that  $8.00  would not  be                                                                   
sufficient  to fully fund  the project.  He pointed  out that                                                                   
any  extra funds  would only  pay  off the  debt earlier.  He                                                                   
noted that  most projects do not  come in at  their estimated                                                                   
price.                                                                                                                          
                                                                                                                                
3:28:21 PM                                                                                                                    
                                                                                                                                
A roll call vote  was taken on the motion to  amend Amendment                                                                   
2 to "$9.00".                                                                                                                   
                                                                                                                                
IN FAVOR: Hawker, Holm, Kelly, Moses, Weyhrauch, Meyer                                                                          
OPPOSED: Foster, Joule, Stoltze, Croft, Chenault                                                                                
                                                                                                                                
The MONTION PASSED (6-5).                                                                                                       
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 2, as amended.                                                                          
                                                                                                                                
A roll call vote  was taken on the motion to  adopt Amendment                                                                   
2.                                                                                                                              
                                                                                                                                
IN FAVOR: Hawker,  Holm,  Joule,   Kelly,  Moses,  Weyhrauch,                                                                   
          Foster, Chenault, Meyer                                                                                               
OPPOSED: Stoltze, Croft                                                                                                         
                                                                                                                                
The MOTION PASSED (9-2).                                                                                                        
                                                                                                                                
Representative  Hawker spoke  in support  of the  legislation                                                                   
and noted the need for the new facility.                                                                                        
                                                                                                                                
3:33:59 PM                                                                                                                    
                                                                                                                                
Representative Holm thanked the  Department of Fish and Game.                                                                   
                                                                                                                                
3:34:19 PM                                                                                                                    
                                                                                                                                
Representative Holm  MOVED to report  HCSSB 147 (FIN)  out of                                                                   
Committee   with    individual   recommendations    and   the                                                                   
accompanying fiscal  notes. There being NO OBJECTION,  it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
HCSSB  147 (FIN) was  REPORTED  out of Committee  with  a "no                                                                   
recommendation" recommendation  and with three  fiscal impact                                                                   
notes: #1 REV, #2 DFG, #3 DFG.                                                                                                  
                                                                                                                                
3:35:08 PM                                                                                                                    
                                                                                                                                
CS FOR SPONSOR SUBSTITUTE FOR SENATE BILL NO. 16(TRA)                                                                         
                                                                                                                                
     "An  Act  relating  to  the powers  and  duties  of  the                                                                   
     Department  of  Transportation  and  Public  Facilities;                                                                   
     repealing the  requirement for a long-range  program for                                                                   
     highway  construction and  maintenance; and repealing  a                                                                   
     requirement  that public  facilities comply with  energy                                                                   
     standards  adopted by the  Department of  Transportation                                                                   
     and Public  Facilities; and  providing for an  effective                                                                   
     date."                                                                                                                     
                                                                                                                                
DOUG LETCH, STAFF, SENATOR GARY  STEVENS, spoke in support of                                                                   
SB 16.  He noted that the  legislation would  update obsolete                                                                   
statutes regarding  the powers  and duties of  the Department                                                                   
of Transportation  and Public  Facilities. The key  provision                                                                   
is  the removal  of  the requirement  for  the department  to                                                                   
conduct  a  cost  benefit  analysis  for  all  projects.  The                                                                   
regulation has  placed the department at a  huge disadvantage                                                                   
because it  makes every project  no matter how  small subject                                                                   
to a cost  benefit analysis. He maintained that  opponents of                                                                   
Department of  Transportation and Public  Facilities projects                                                                   
have used the provision as a basis of litigation.                                                                               
                                                                                                                                
Representative  Croft  observed  that the  legislation  would                                                                   
eliminate a cost  benefit study on all projects  and asked if                                                                   
it would  be appropriate  to require  it on  medium to  large                                                                   
projects. Vice-Chair  Meyer asked  that the question  be held                                                                   
till after Mr. Ottensen's presentation.                                                                                         
                                                                                                                                
JEFF  OTTENSEN, DIRECTOR,  DIVISION  OF PROGRAM  DEVELOPMENT,                                                                   
DEPARTMENT OF TRANSPORTATION AND  PUBLIC FACILITIES, referred                                                                   
to  a sectional  analysis  (copy on  file.)  Section 1  would                                                                   
grant the department  the ability to issue grants,  when they                                                                   
have  been authorized  by appropriation  of the  legislature.                                                                   
The department  receives  money in at  least three  different                                                                   
categories from federal  sources that is then  granted out to                                                                   
local governments  and non-profits.  Section 3 contained  the                                                                   
old  cost  benefit  language.  Section  5  adds  a  new  cost                                                                   
effectiveness  requirement  for  new projects  that  are  not                                                                   
local. This would  eliminate the burden from 80  - 90 percent                                                                   
of their  projects. Significant  projects  that are beyond  a                                                                   
local town  or road would  be included. A cost  effectiveness                                                                   
analysis  would  be  required,  at  a  lower  cost  than  the                                                                   
traditional  cost  benefit  analysis.  Section  8  gives  the                                                                   
department   one  year   to  implement   Section  5   through                                                                   
regulation. He noted that the  statutes are over 30 years old                                                                   
and  felt  that  the legislation  would  be  good  for  local                                                                   
governments and the department.                                                                                                 
                                                                                                                                
3:40:46 PM                                                                                                                    
                                                                                                                                
Representative  Croft questioned  how  the legislation  would                                                                   
benefit  the public.  In  response  to further  questions  by                                                                   
Representative  Croft, Mr.  Ottensen referred  to section  5,                                                                   
which  requires  a  new  cost   effective  analysis  for  new                                                                   
highways,  airports,  terminals,  ferries,  and  other  major                                                                   
components.    Projects    requiring    rehabilitation    and                                                                   
maintenance of the existing system,  or would primarily serve                                                                   
local transportation needs are excluded.                                                                                        
                                                                                                                                
Representative  Croft asked why  there should  not be  a cost                                                                   
benefit analysis  for these  projects. Mr. Ottensen  stressed                                                                   
that  the greatest  burden  is  on municipalities  and  local                                                                   
government. The  state of Alaska  is geared up to  make these                                                                   
analyses. The  cost benefit analysis  occurs at  the planning                                                                   
stage. The  quality of data goes  up on almost  every project                                                                   
as  it goes  through the  process. Cost  studies become  more                                                                   
meaningful later in the process.                                                                                                
                                                                                                                                
Representative  Croft  questioned why  not  require the  cost                                                                   
studies later and asked if they are being done twice.                                                                           
                                                                                                                                
3:44:38 PM                                                                                                                    
                                                                                                                                
Mr. Ottensen agreed  and reiterated that the  statute affects                                                                   
planning.   Cost  effective  studies   exempted  during   the                                                                   
planning stage could be required at the building stage.                                                                         
                                                                                                                                
3:45:37 PM                                                                                                                    
                                                                                                                                
Representative  Holm asked  if  the legislation  would  solve                                                                   
problems with cost  benefit analysis that have  no merit. Mr.                                                                   
Ottensen felt that the legislation  would fix the problem. He                                                                   
maintained  that delay  of the  legislation  resulted in  the                                                                   
death of three individuals due  to the department's inability                                                                   
to go forward on a bridge.                                                                                                      
                                                                                                                                
3:47:09 PM                                                                                                                    
                                                                                                                                
Mr. Ottensen  noted that projects  in the GARVEE  legislation                                                                   
have  not   gone  through  a   cost  benefit   analysis.  The                                                                   
department will  need to do a  cost benefit analysis  on each                                                                   
of  these projects  as soon  as the  [GARVEE] legislation  is                                                                   
passed.                                                                                                                         
                                                                                                                                
3:47:21 PM                                                                                                                    
                                                                                                                                
Representative Hawker MOVED to  report CSSSSB 16 (TRA) out of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal  notes. There being NO OBJECTION,  it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
CSSSSB  16 (TRA) was  REPORTED  out of Committee  with  a "do                                                                   
pass" recommendation  and with two zero fiscal  impact notes:                                                                   
#1 DOT, #2 DPS.                                                                                                                 
                                                                                                                                
3:48:23 PM                                                                                                                    
                                                                                                                                
CS FOR SENATE BILL NO. 139(L&C)                                                                                               
                                                                                                                                
     "An  Act  relating  to  termination   and  oversight  of                                                                   
     boards, commissions, and  agency programs; extending the                                                                   
     termination  date of  the  Board of  Marital and  Family                                                                   
     Therapy; and providing for an effective date."                                                                             
                                                                                                                                
TOM MAHER, STAFF, SENATOR GENE THERRIAULT, spoke in support                                                                     
of the legislation.                                                                                                             
                                                                                                                                
     This  Legislation stems  from recommendations  contained                                                                   
     in two reports by the Division of Legislative Audit.                                                                       
                                                                                                                                
     First, this  legislation extends the sunset  date of the                                                                   
     Board of Marital  and Family Therapy from  June 30, 2005                                                                   
     to June 30, 2010 per the  audit recommendation contained                                                                   
     in that report (page 9).                                                                                                   
                                                                                                                                
     Second,   HCS   CSSB   139   (L&C)   also   incorporates                                                                   
     recommendations  contained in  the audit  of the  Alaska                                                                   
     Sunset Process and Selected Investigative Issues.                                                                          
                                                                                                                                
     This legislation changes  the standard sunset period for                                                                   
     occupational   boards  in  AS   0803.020  (c)   and  non                                                                   
     occupational  boards in  AS 44.66.010  (c) from  "not to                                                                   
     exceed  four  years"  to  not to  exceed  eight  years".                                                                   
     Increasing the standard sunset  period allows for better                                                                   
     use  of  audit  staff, committee  time,  and  makes  the                                                                   
     sunset  process  less  consuming  for  board  regulatory                                                                   
     agencies. As  Alaska's sunset process has  matured, most                                                                   
     of the sunset  reviews are less about  eliminating board                                                                   
     and    commissions,   and    more   about    operational                                                                   
     performance.  Twelve  states  have  either  repealed  or                                                                   
     suspended   their  sunset   process.  The  most   common                                                                   
     standard  extension  is ten  years,  while Alaska  along                                                                   
     with  three  other  states have  maintained  a  standard                                                                   
     four-year  extension. Of  course,  the Legislature  will                                                                   
     still he able  to set whatever time extensions  it deems                                                                   
     appropriate, regardless of this statutory change.                                                                          
                                                                                                                                
     TICS CSSB  139 (L&C) also  adds two criteria  to statute                                                                   
     that  must  be considered  in  the  course of  a  sunset                                                                   
     review by the auditors:                                                                                                    
                                                                                                                                
        • The extent to which the board, commission, or                                                                         
          agency has effectively attained its objectives and                                                                    
          the efficiency with which it has operated.                                                                            
        • The extent to which the board, commission, or                                                                         
          agency duplicates the activities of another                                                                           
          governmental agency or the private sector.                                                                            
                                                                                                                                
   Expanding the criteria will assure that auditors will                                                                        
   measure the efficiency and effectiveness of boards,                                                                          
   commissions or agencies under review                                                                                         
                                                                                                                                
3:54:10 PM                                                                                                                    
                                                                                                                                
Representative Hawker  asked about criteria adding  to sunset                                                                   
regulations.   He  referenced   subsection  (10),   regarding                                                                   
effectiveness and efficiency.                                                                                                   
                                                                                                                                
3:54:46 PM                                                                                                                    
                                                                                                                                
PAT   DAVIDSON,  LEGISLATIVE   AUDITOR,   LEGISLATIVE   AUDIT                                                                   
DIVISION,  explained   that  under  the  provisions   of  the                                                                   
legislation, the  agency, board or commission  being audited,                                                                   
would know how they would be evaluated.  She stressed that it                                                                   
is  important   that  information   regarding  missions   and                                                                   
measures are  brought to the  entities being examined.  There                                                                   
are  ways  to  measure  efficiency   and  effectiveness.  The                                                                   
legislation  would  also address  non-occupational  agencies,                                                                   
such as the  Council on Domestic Violence and  Sexual Assault                                                                   
(CDVSA).                                                                                                                        
                                                                                                                                
Representative  Hawker questioned who  would set  the mission                                                                   
and measure standards and whether  there would be legislative                                                                   
guidance.  Ms. Davidson  responded that  they would  look for                                                                   
best practices. Many are not Alaska  only organizations. They                                                                   
would build on any existing measures  or missions. Efficiency                                                                   
is determined  through observation. She noted  the division's                                                                   
support.                                                                                                                        
                                                                                                                                
3:58:32 PM                                                                                                                    
                                                                                                                                
RICK URION,  DIRECTOR, OCCUPATIONAL LICENSING,  DEPARTMENT OF                                                                   
COMMUNITY AND  ECONOMIC DEVELOPMENT,  spoke in support  of an                                                                   
amendment  that would  restore  provisions  removed from  the                                                                   
previous committee  of referral.  The provisions  in question                                                                   
related to  what happens after  a board sunsets.  He observed                                                                   
that the licensing law is not  removed after a board sunsets.                                                                   
The proposed  amendment would put  the duty on  the division.                                                                   
                                              th                                                                                
He noted that a board is being sunset June 30 this year.                                                                        
                                                                                                                                
Co-Chair Chenault  requested that  the amendment  be provided                                                                   
for a future Finance Committee meeting.                                                                                         
                                                                                                                                
HCSSB   139  (L&C)  was   HELD  in   Committee  for   further                                                                   
consideration.                                                                                                                  
                                                                                                                                
4:00:38 PM                                                                                                                    
                                                                                                                                
At ease.                                                                                                                        
                                                                                                                                
4:01:37 PM                                                                                                                    
                                                                                                                                
SENATE JOINT RESOLUTION NO. 11                                                                                                
                                                                                                                                
     Urging the United States Congress to amend the tax code                                                                    
    to repeal the federal excise tax on communications.                                                                         
                                                                                                                                
DAVE  STANCLIFF, STAFF,  SENATOR  GENE THERRIAULT,  spoke  in                                                                   
support of the legislation                                                                                                      
                                                                                                                                
       This  resolution  encourages  Congress  to once  again                                                                   
       pass  a  provision  to repeal  the  "tax on  talking",                                                                   
       formally   known  as   the  federal  excise   tax  oil                                                                   
       communications.   This tax  was  originally  put  into                                                                   
       place  in 1898 to  help fund the Spanish  American War                                                                   
       under the guise of a temporary luxury tax.                                                                               
                                                                                                                                
       Since   that  time,   it  has  been  repealed   twice,                                                                   
       reenacted   in  1941,   adjusted  from  10%   in  1965                                                                   
       downward  to be phased  out at 1% per year,  reached a                                                                   
       low of                                                                                                                   
       1%  in 1981 and  then began  to rise and  climbed back                                                                   
       to  3%.  It  has  remained  at that  level  since  the                                                                   
       Revenue  Reconciliation Act of 1990.  In 2000 Congress                                                                   
       moved  to repeal  the tax  once and  for all;  however                                                                   
       President Bill Clinton vetoed the measure.                                                                               
                                                                                                                                
       Currently  more than 94 million households  pay the 3%                                                                   
       phone  tax.  It disproportionately  hurts seniors  and                                                                   
       others  on low  or fixed  incomes. It  affects 96%  of                                                                   
       the  households  using the  phone  lines for  Internet                                                                   
       service.  At a  time when  we are  trying to  increase                                                                   
       commerce this is a harmful tax.                                                                                          
                                                                                                                                
4:04:28 PM                                                                                                                    
                                                                                                                                
Co-Chair Chenault  pointed out the zero fiscal  note and that                                                                   
Alaskan taxpayers pay $17 million to the tax.                                                                                   
                                                                                                                                
4:05:11 PM                                                                                                                    
                                                                                                                                
Representative  Holm asked  if  the state  of  Alaska pays  a                                                                   
federal excise  tax. Mr. Stancliff  explained that  the state                                                                   
of Alaska is exempted from the tax.                                                                                             
                                                                                                                                
Representative   Hawker   asked   the  consequence   of   the                                                                   
legislation.  Mr. Stancliff  responded  that  there would  be                                                                   
cuts  to  offset  the  revenue  or  new  sources  of  revenue                                                                   
discovered. Alaska does not benefit directly from the tax.                                                                      
                                                                                                                                
4:07:11 PM                                                                                                                    
                                                                                                                                
Representative Weyhrauch referred  to lines 11 - 13. He noted                                                                   
that  the  legislation  maintains that  the  tax  discourages                                                                   
expansion. Mr. Stancliff observed that the money does not go                                                                    
back into the expansion of the facilities.                                                                                      
                                                                                                                                
4:09:53 PM                                                                                                                    
                                                                                                                                
Representative  Foster   MOVED  to  report  SJR   11  out  of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal  note. There  being NO OBJECTION,  it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
SJR 11 was REPORTED out of Committee with a "do pass"                                                                           
recommendation and with a zero fiscal impact note by the                                                                        
Department of Revenue.                                                                                                          
                                                                                                                                
4:10:37 PM                                                                                                                    
                                                                                                                                
At ease.                                                                                                                        
                                                                                                                                
5:15:29 PM                                                                                                                    
                                                                                                                                
CS FOR SENATE BILL NO. 141(FIN)                                                                                               
                                                                                                                                
     "An Act relating to the teachers'  and public employees'                                                                   
     retirement  systems  and creating  defined  contribution                                                                   
     and  health  reimbursement  plans  for  members  of  the                                                                   
     teachers'  retirement system  and the public  employees'                                                                   
     retirement  system who  are  first hired  after July  1,                                                                   
     2005;  relating   to  university  retirement   programs;                                                                   
     establishing the  Alaska Retirement Management  Board to                                                                   
     replace the  Alaska State Pension Investment  Board, the                                                                   
     Alaska  Teachers'  Retirement   Board,  and  the  Public                                                                   
     Employees'  Retirement  Board;  adding  appeals  of  the                                                                   
     decisions  of the  administrator  of  the teachers'  and                                                                   
     public    employees'   retirement    systems   to    the                                                                   
     jurisdiction of  the office of administrative  hearings;                                                                   
     providing  for   nonvested  members  of   the  teachers'                                                                   
     retirement  system  defined  benefit plans  to  transfer                                                                   
     into   the    teachers'   retirement    system   defined                                                                   
     contribution  plan  and  for nonvested  members  of  the                                                                   
     public  employees'  retirement  system  defined  benefit                                                                   
     plans to transfer into the  public employees' retirement                                                                   
     system   defined   contribution  plan;   providing   for                                                                   
     political  subdivisions   and  public  organizations  to                                                                   
     request to participate in  the public employees' defined                                                                   
     contribution  retirement  plan;  and  providing  for  an                                                                   
     effective date."                                                                                                           
                                                                                                                                
                                                                                                                                
CO-CHAIR CHENAULT MOVED to ADOPT revised fiscal note #10.                                                                       
                                                                                                                                
Representative Joule OBJECTED for discussion purposes.                                                                          
                                                                                                                                
5:16:27 PM                                                                                                                    
                                                                                                                                
MELANIE  MILLHORN,  DIRECTOR,   DIVISION  OF  RETIREMENT  AND                                                                   
BENEFITS,  DEPARTMENT OF ADMINISTRATION,  explained  that the                                                                   
fiscal  note represents  the fiscal costs  that the  division                                                                   
anticipates  will  accompany  the  new  defined  contribution                                                                   
plan. The state  of Alaska's tax attorney indicated  that all                                                                   
costs associated  with the defined contribution  plan must be                                                                   
separated and  accounted for in  various funds,  according to                                                                   
their components.  Assets and  accounting must be  separated.                                                                   
She explained  that the  fiscal note  separates the  start-up                                                                   
costs.                                                                                                                          
                                                                                                                                
5:18:03 PM                                                                                                                    
                                                                                                                                
Representative Croft  asked if the statutory  required backup                                                                   
for SB 141 was being compiled. Co-Chair Meyer confirmed.                                                                        
                                                                                                                                
5:18:42 PM                                                                                                                    
                                                                                                                                
Representative Croft  asked if the 5 percent  being set aside                                                                   
for the  defined contribution  plan would  be sufficient  for                                                                   
individuals to  retire on. Ms. Millhorn referred  to modeling                                                                   
in  the  plan contained  in  slide  74.  Slide 74  shows  the                                                                   
accrual of non-medical benefits.  The modeling is based on an                                                                   
individual that comes  into the system at age  40. The design                                                                   
looked  at  a defined  benefit  component  with  an  employer                                                                   
contribution  of 3.5  percent. The  current version  is at  5                                                                   
percent.  An individual,  who  enters the  system  at age  40                                                                   
under alternative  2, which was  based on was a  DB component                                                                   
of 3.5 percent,  would have a higher benefit  the the current                                                                   
Tier 2 TRS component until age  55 compared. Graphing for a 5                                                                   
percent contribution was not available.  Mercer would have to                                                                   
run the caluculations.  The average years of  service for TRS                                                                   
is  10 years.  She  maintained  that for  80  percent of  the                                                                   
population the benefit would be a higher under TRS.                                                                             
                                                                                                                                
5:23:06 PM                                                                                                                    
                                                                                                                                
Representative Croft asked how  the wages are broken down for                                                                   
low paid employees vs. high. Ms.  Millhorn replied that the 5                                                                   
percent is  based on their  salaries. She explained  that the                                                                   
graph is based on one individual  at age 40 based on a salary                                                                   
of $35,000, which is lower than  the average salary for PERS.                                                                   
                                                                                                                                
5:25:31 PM                                                                                                                    
                                                                                                                                
Representative  Croft asked the  cost and funding  source for                                                                   
the  disability benefit  allowance. Ms.  Millhorn noted  that                                                                   
the benefit is currently unfunded.  The contribution would be                                                                   
placed   in  the   medical   component,   with  an   employer                                                                   
contribution  of  between 2.5  and  3.75 percent.  The  added                                                                   
death and disability benefit would  be included on top of the                                                                   
medical costs. Ms.  Millhorn had not had a chance  to get the                                                                   
cost estimates from Mercer.                                                                                                     
                                                                                                                                
5:28:29 PM                                                                                                                    
                                                                                                                                
Representative  Croft asked  about the  death and  disability                                                                   
benefit. He  gave an  example of  firefighters and  asked who                                                                   
would pay  the benefit, the state  or the city.  Ms. Millhorn                                                                   
noted that  the proposal by  Representative Kelly  would have                                                                   
been  a fixed  amount paid  by  the employer.  Representative                                                                   
Croft noted that the proposed  amendment in the House Finance                                                                   
Committee  version would also  be paid  by the employer.  Ms.                                                                   
Millhorn agreed and  added that the funding  source and costs                                                                   
were unknown.                                                                                                                   
                                                                                                                                
5:31:30 PM                                                                                                                    
                                                                                                                                
Representative  Joule  WITHDREW his  objection  to ADOPT  the                                                                   
fiscal  note. There  being NO  further OBJECTION,  it was  so                                                                   
ordered.                                                                                                                        
                                                                                                                                
Co-Chair Chenault MOVED to report  HCSSB 141 out of Committee                                                                   
with  individual recommendations  and  with the  accompanying                                                                   
fiscal notes.                                                                                                                   
                                                                                                                                
Representative Croft  OBJECTED. He argued that  the Committee                                                                   
cannot estimate  within a million  dollars the  obligation to                                                                   
the state or the funding mechanism.                                                                                             
                                                                                                                                
5:34:27 PM                                                                                                                    
                                                                                                                                
Representative  Holm pointed  out  that  the Committee  deals                                                                   
daily with issues that are unknown.                                                                                             
                                                                                                                                
5:35:17 PM                                                                                                                    
                                                                                                                                
Co-Chair Meyer  noted that  bills are  often passed  out with                                                                   
indeterminate fiscal notes.                                                                                                     
                                                                                                                                
5:35:35 PM                                                                                                                    
                                                                                                                                
Representative  Kelly  explained  that  the  current  version                                                                   
maintains  the   status  quo   [in  relation  to   death  and                                                                   
disability benefits  for certain  employees]. He  argued that                                                                   
the  Mercer  letter clarifies  that  under  the DC  plan  the                                                                   
action is positive and it puts the amendment in context.                                                                        
                                                                                                                                
5:36:40 PM                                                                                                                    
                                                                                                                                
Representative Croft  emphasized that no one  would be paying                                                                   
into the DB  system for the death and disability  benefit. He                                                                   
questioned  how it  would  be funded.  He  opined that  there                                                                   
would be an  additional fiscal impact. He suggested  that the                                                                   
law is being violated.                                                                                                          
                                                                                                                                
5:38:28 PM                                                                                                                    
                                                                                                                                
Representative Hawker expressed  concern that the Committee's                                                                   
action  was out  of compliance  with AS  24.08.036. He  spoke                                                                   
against the legislation.                                                                                                        
                                                                                                                                
5:39:40 PM                                                                                                                    
                                                                                                                                
Representative  Kelly related  that  the dying  rate and  the                                                                   
costs  are  known  and  can be  managed.  He  felt  that  the                                                                   
Committee responded to the actuarial request.                                                                                   
                                                                                                                                
Representative Croft MAINTAINED his OBJECTION.                                                                                  
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Holm,  Kelly,   Moses,  Stoltze,   Foster,  Hawker,                                                                   
Meyer, Chenault                                                                                                                 
OPPOSED: Joule, Croft                                                                                                           
                                                                                                                                
The MOTION PASSED (8-2).                                                                                                        
                                                                                                                                
HCSSB  141 (FIN) was  REPORTED  out of Committee  with  a "no                                                                   
recommendation"  with the following  fiscal impact  notes: #1                                                                   
ADM, #3 REV, #4 REV, #5 REV, #6 REV, #7 REV, #9 FIN.                                                                            
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 5:44 PM                                                                                            
                                                                                                                                
                                                                                                                                

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