Legislature(2021 - 2022)ADAMS 519

05/18/2021 01:30 PM House FINANCE

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                     HOUSE FINANCE COMMITTEE                                                                                    
                           May 18, 2021                                                                                         
                            1:34 p.m.                                                                                           
1:34:36 PM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair  Merrick  called  the  House  Finance  Committee  meeting                                                              
to order at 1:34 p.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Representative Neal Foster, Co-Chair                                                                                            
Representative Kelly Merrick, Co-Chair                                                                                          
Representative Dan Ortiz, Vice-Chair                                                                                            
Representative   Ben Carpenter                                                                                                  
Representative   DeLena Johnson                                                                                                 
Representative   Andy Josephson                                                                                                 
Representative Bart LeBon                                                                                                       
Representative Sara Rasmussen                                                                                                   
Representative Steve Thompson                                                                                                   
Representative Adam Wool                                                                                                        
MEMBERS ABSENT                                                                                                                
Representative Bryce Edgmon                                                                                                     
ALSO PRESENT                                                                                                                  
Representative   Andy   Josephson,  Sponsor;   Elise  Sorum-Birk,                                                               
Staff,    Representative     Andy    Josephson;    Kris    Curtis,                                                              
Legislative   Auditor,  Alaska  Division   of Legislative   Audit;                                                              
Caroline  Schultz,   Policy  Analyst,  Office  of  Management  and                                                              
Budget,  Office  of  the  Governor;  Representative   Geran  Tarr,                                                              
Chair,    House   Fisheries    Committee,     Sponsor;    Thatcher                                                              
Brouwer, Staff, Representative Geran Tarr.                                                                                      
PRESENT VIA TELECONFERENCE                                                                                                    
Mike  Coons,  Self,  Palmer;  Aaron  Martin,  United  States  Fish                                                              
and    Wildlife     Service,    Anchorage;     Danielle     Verna,                                                              
Environmental   Monitoring    Program  Manager,   Prince   William                                                              
Sound   Regional   Citizens   Advisory   Council,   Valdez;   Doug                                                              
Vincent-Lang,   Commissioner,    Department  of   Fish  and  Game;                                                              
Laura     Achee,    Legislative     Liaison,     Department     of                                                              
Environmental Conservation.                                                                                                     
HB 54      INVASIVE SPECIES MANAGEMENT                                                                                          
           HB 54 was HEARD and HELD in committee for further                                                                    
HB 57      FUNDS SUBJECT TO CBR SWEEP PROVISION                                                                                 
           HB 57 was HEARD and HELD in committee for further                                                                    
Co-Chair Merrick reviewed the meeting agenda.                                                                                   
HOUSE BILL NO. 57                                                                                                             
      "An   Act   relating    to   the    budget   reserve    fund                                                              
      established  under  art.  IX, sec.  17(d),  Constitution  of                                                              
      the State  of  Alaska;   relating  to  money  available  for                                                              
      appropriation   for purposes   of  applying  art.  IX,  sec.                                                              
      17, Constitution   of the  State  of Alaska;  and  providing                                                              
      for an effective date."                                                                                                   
1:35:30 PM                                                                                                                    
REPRESENTATIVE     ANDY   JOSEPHSON,    SPONSOR,    thanked    the                                                              
committee  for  hearing  the  bill.  He shared  that  he had  been                                                              
a  legislative    staffer   when   the   House   had  passed   the                                                              
amendment   for  the  Constitutional   Budget   Reserve  (CBR)  in                                                              
1990.  He opined  that  presently,   the state  likely  would  not                                                              
create  a  CBR  but  acknowledged   the  creation  had  a  lasting                                                              
effect.  He  indicated  that  the CBR  was  a way  to house  funds                                                              
more  accessible  than  the corpus  [of  the Permanent  Fund]  but                                                              
not  readily  accessible.  He  commented  that  a  30/15 vote  was                                                              
necessary   to  access   the  funds.   He  referenced   the  funds                                                              
subject  to  the  sweep  that  were fundamental   to  the CBR.  He                                                              
noted  the  dispute  amongst  legislators   whether  the CBR  debt                                                              
mattered  since   it was  a  debt  to  the legislature   that  did                                                              
not  bear  interest.  He  specified  that  the  funds  subject  to                                                              
the  sweep  needed  to  be  in the  general   fund  and  available                                                              
for  appropriation.  The  bill  had originated   from a  situation                                                              
in  July 2019  [Special   Session].  He delineated   that  several                                                              
hearings  took  place  in  the  Senate  Finance  Committee   [post                                                              
regular  session]   regarding  what  funds  were  subject  to  the                                                              
sweep  that involved   the Legislative   Finance  Division  (LFD),                                                              
Division  of  Audit, Office  of  Management  and  Budget,  and the                                                              
Department  of  Law  (DOL).  He mentioned   the various  views  on                                                              
what  funds  were subject  to  the  sweep and  cited  a memo  from                                                              
the  Attorney   General   (AG)  at  the   time,  Kevin   Clarkson,                                                              
[Attorney   General,   Department   of  Law,   2019-  August   24,                                                              
2020]  that  included   the  Power  Cost  Equalization   (PCE)  as                                                              
subject  to the  sweep.  He provided  context  for  the  hearings;                                                              
the  Capital  Budget  was  not  yet  adopted,  the  reverse  sweep                                                              
had  not happened,   and  the states   largest   operating  budget                                                              
vetoes   had  occurred.   He  felt   that   the  legislature   was                                                              
unable  to  figure   a  way  out  of  the   political   or  fiscal                                                              
1:39:00 PM                                                                                                                    
Representative   Josephson  continued   that  there  were  roughly                                                              
180  different   sub-accounts   of the  General   Fund  (GF),  and                                                              
the  question  became  how  many  of  the  funds  were sweepable.                                                               
The  incident  prompted  him to  introduce  HB 57.  He referenced                                                               
a  PowerPoint   presentation   (copy  on  file)   titled  "HB  57"                                                              
showing  the  CBR  language.   He  elaborated   that  the  initial                                                              
attempt   to define    what  was  available   for  appropriation                                                                
occurred  in  1994  in the  case Hickel  v.  Cowper  [both  former                                                              
governors].   He  shared  that  he  and  his  staffer,  Ms.  Elise                                                              
Sorum-Birk  studied   the case  and  used  it as  their  guidepost                                                              
for  the  legislation.   He  related   that  the  case   concluded                                                              
that  not all  funds  were  sweepable;  monies  that  had  already                                                              
been  appropriated  were  available  for  appropriation,   however                                                              
revolving  loan  funds  were typically   not deemed  eligible  for                                                              
appropriation   and   would  be  against   statutory   intent  and                                                              
trust  doctrine   to expend   all  of a  rotating   funds   monies                                                              
therefore   it  was  not  all  available  for  appropriation.   He                                                              
emphasized  the  complexity  of  the issue.  He  related  that his                                                              
key  motivation  was to  avoid  going  through  another  situation                                                              
like  July   2019  again.   He  believed   that  the  legislature                                                               
should   write  a   statute  consistent    with  the  1994   state                                                              
Supreme Court ruling.                                                                                                           
1:44:11 PM                                                                                                                    
Representative   Josephson   reported  that  the  bill   attempted                                                              
to  resolve  the  issues.  He  exemplified  the  provision   in HB
57  that stated  PCE  was  nominally  held  in the  Alaska  Energy                                                              
Authority   (AEA)   and   not   subject   to  appropriation.    He                                                              
relayed   that   he   frequently   had   discussions   with   Kris                                                              
Curtis,  Legislative   Auditor,  Alaska  Division  of Legislative                                                               
Audit;  Megan  Wallace,  Director,  Legislative   Legal  Services,                                                              
Alaska   State  Legislature;    and  Alexei   Painter,   Director,                                                              
Legislative     Finance    Division    when    working    on   the                                                              
legislation.   Representative    Josephson   concluded   that  the                                                              
Supreme  Court  had  ruled  that some  items  were  sweepable  and                                                              
some were not.                                                                                                                  
Co-Chair  Merrick  noted  that  Representative   Wool  had  joined                                                              
the meeting.                                                                                                                    
ELISE   SORUM-BIRK,   STAFF,   REPRESENTATIVE    ANDY  JOSEPHSON,                                                               
presented   the  PowerPoint    presentation   and  began   with  a                                                              
brief  sectional   analysis   of  the  bill  on   slide  1  titled                                                              
 Sectional Analysis:                                                                                                            
      Section 1 - Uncodified language- legislative intent                                                                       
      and findings                                                                                                              
     Section 2 - Defines "available for appropriation."                                                                         
      Section  3  -  Codifies  the  principle   that  funds  found                                                              
      within  the  general  fund  that  do  not  require   further                                                              
      appropriation  (or  must  be held  separately   by law)  are                                                              
      not subject  to  the  sweep.  Lists  funds that  meet  these                                                              
      Section 4 - Defines "general fund."                                                                                       
      Section 5 - Effective Date - June 30, 2021                                                                                
Ms.  Sorum-Birk  elaborated  that  Section  1 was  an analysis  of                                                              
the  Hickel v.  Cowper  court  case. She  described  Section  1 as                                                              
a lengthy   analysis  of  legislative  findings  and  intent.  She                                                              
revealed  that  although  abnormal,   a clear  record  of  why the                                                              
bill  was  drafted   in  the  manner   chosen  was  important   to                                                              
establish.   She   highlighted   that  Section   2  repealed   and                                                              
reenacted   AS   37.10.420   (a).  The   section   contained   the                                                              
statutory  definition   for  available   for appropriation,"   and                                                              
to  align  with  the principles   outlined  in  Hickel  v  Cowper,                                                              
where  the  Supreme  Court  ruled  that the  initial  legislative                                                               
attempt  was  unconstitutional.   She elaborated   that Section  3                                                              
added  language  to  AS 37.10.420  (b)  and  added  that the  list                                                              
of  GF   was  non-inclusive.    She  commented   that   Section  4                                                              
created   a   new  section,    AS  37.10.420(c),    that   defined                                                              
"general   fund"   and  outlined   fund   types   explicitly   not                                                              
considered   to be  part  of the  general  fund.  She  noted  that                                                              
Section  5  provided  an  effective   date  of Jun  30,  2021,  to                                                              
ensure  that  the legislation  would  be  in effect  prior  to the                                                              
FY 2021 CBR sweep occurring.                                                                                                    
Co-Chair   Merrick  noted   that  Representative   Carpenter   had                                                              
joined the meeting.                                                                                                             
Ms.  Sorum-Birk   turned   to  slide  3  and  addressed   the  CBR                                                              
repayment provision:                                                                                                            
      Article  IX,  Section   17(d)-   "If  an  appropriation   is                                                              
      made  from  the  budget  reserve  fund,   until  the  amount                                                              
      appropriated   is  repaid,  the  amount   of  money  in  the                                                              
      general  fund available  for  appropriation   at the  end of                                                              
      each succeeding   fiscal  year  shall  be deposited   in the                                                              
      budget  reserve  fund.   The legislature   shall   implement                                                              
      this subsection by law."                                                                                                  
Ms.  Sorum-Birk   pointed  out  that  an  item  had  to  meet  two                                                              
criteria:   it had  to  be  in the  general   fund  and  available                                                              
for  appropriation.    She  noted   the  emphasis   on   the  last                                                              
sentence   stating   the    legislature   shall   implement   this                                                              
subsection   by law.   Even  though,  the  legislature   attempted                                                              
to do so in 1994, the law was found unconstitutional.                                                                           
1:50:22 PM                                                                                                                    
AT EASE                                                                                                                         
1:50:52 PM                                                                                                                    
Ms.  Sorum-Birk  turned  to slide  4 titled   Legislative   Intent                                                              
      "It  is   the  intent    of  the   legislature   to   create                                                              
      statutory   definitions   for  these   terms  in   alignment                                                              
      with both  the  current  legal  understanding   of them  and                                                              
      the reality of existing state fiscal systems."                                                                            
           O A lack of clarity in statutes surrounding the                                                                      
           mechanics of the sweep provision                                                                                     
           O Potential adverse impacts on the availability                                                                      
           of important fund sources                                                                                            
           O July 2019 events                                                                                                   
           O Need consistent meaning of terms "general fund"                                                                    
           and "available for appropriation"                                                                                    
Ms.   Sorum-Birk    referred   to   Representative    Josephsons                                                                
testimony   describing  the  events   of  July  2019  and  offered                                                              
that  the event  illustrated  the  need  for more  clarity  in the                                                              
law  on  the  matter.   She  shared   the  concern  that   without                                                              
statutory    definitions    the   sweep   became   a   matter   of                                                              
administrative    policy.   She   turned   to   Slide   5   titled                                                              
 Legislative Intent 2:                                                                                                          
      It  is  the  intent  of  the   legislature   to  update  the                                                              
      section    of     statute    defining     "available     for                                                              
      appropriation"   to  specifically    reflect  the   findings                                                              
      set forth in Hickel."                                                                                                     
           The Alaska Supreme Court's analysis in the Hickel                                                                    
           v. Cowper decision provides a framework                                                                              
           A legislative obligation exists to implement by                                                                      
           law Article 9 Section 17(d) of the constitution                                                                      
                 1994 passage of House Bill 58 (AS 37.10.420)                                                                   
                 aimed to do this but was found to be broadly                                                                   
                 Supreme Court outlined general standard and                                                                    
                 invited a reexamination of this statute                                                                        
      "We  also  make   no  attempt   to  name  and  classify   as                                                              
      "available"   or  "unavailable"   every   fund   within  the                                                              
      treasury  of  the State  of  Alaska.  We  leave  it,  in the                                                              
      first  instance,   to  executive   and  legislative   branch                                                              
      officials  more familiar   with all  of the  funds  involved                                                              
      to  apply   the  general   definition    we  adopt   today."                                                              
      (Hickel v Cowper, 874 P. 2d 922, n. 27)                                                                                   
      Legislative  Audit  Finding  No. 2019-089   of the  State of                                                              
      Alaska FY 2019 Single Audit                                                                                               
1:54:05 PM                                                                                                                    
Ms.   Sorum-Birk    offered   that   the   court    outlined   the                                                              
principles   and  provided  a  broad  framework   but left   it to                                                              
the  policy makers  to  implement  its views.  She  noted  that in                                                              
the ensuing years no legal remedy had been pursued.                                                                             
1:54:50 PM                                                                                                                    
Ms. Sorum-Birk reviewed on slide 6 titled Legislative                                                                           
Intent 3:                                                                                                                       
      "It is  the  intent  of  the  legislature   to  protect  the                                                              
      financial  security   of  existing  programs   and  maintain                                                              
      the  integrity   of  state  financial   structures   to  the                                                              
      greatest extent possible"                                                                                                 
           The   Hickel   ruling  voiced   clear   opposition   to                                                              
           disrupting    the   mechanics    of   state    finance;                                                              
           advocated commonsense approach                                                                                       
           Legislature's   view  too  narrow,  Cowper's  view  too                                                              
           Revolving    Loan   Funds-    "?the   existing    state                                                              
           programs   dependent  on  these  funds  would  have  to                                                              
           be  curtailed   if   these  funds   were  expended   on                                                              
           another   purpose.    These   funds   are  maintained,                                                               
           however,    because    in   the    judgment    of   the                                                              
           legislature    they   serve    worthwhile   purposes."                                                               
           (Hickel, 874 P. 2d at 929)                                                                                           
Ms. Sorum-Birk reviewed slide 7 titled "Legislative Intent                                                                      
      "The  legislature   finds  that  appropriated   funds  which                                                              
      can be  expended  with no  further  legislative  action  are                                                              
      no longer   considered   available  for  appropriation   and                                                              
      thus  would  not  be  included  in  the  sweep?  It  is  the                                                              
      intent of  the legislature   to include  this  principle  in                                                              
      the    codified     definition     of     'available     for                                                              
           O True  regardless  of  if the  funds  were given  to a                                                              
           state  agency  to spend  or were  held  in the  general                                                              
           O  Hickel  -  Article  17  did not  require   "counting                                                              
           funds  already  validly   appropriated  to  a  specific                                                              
           purpose   as  still   'available'"   and  that   monies                                                              
           already  "validly   committed  by  the  legislature  to                                                              
           some  purpose  should  not be  counted  as available."                                                               
           (Hickel, 874 P. 2d at 930-931)                                                                                       
Ms.  Sorum-Birk   added   to  the  first   bullet   point  on  the                                                              
slide.   She  furthered   that  if   a  pot  of  money   is  fully                                                              
obligated or if the legislature has relinquished its power                                                                      
of appropriation over a fund, then it is not subject to the                                                                     
1:55:51 PM                                                                                                                    
Ms. Sorum-Birk moved to slide 8 titled Legislative Intent                                                                       
      "The legislature   finds  that  any  funds  that  cannot  be                                                              
      immediately   expended   through   appropriation    are  not                                                              
      considered  available   for  appropriation    and  thus  are                                                              
      not subject   to  the  sweep  ?  It is  the  intent  of  the                                                              
      legislature  to  include  this  principle  in  the  codified                                                              
      definition of 'available for appropriation.' "                                                                            
      The Hickel   Court  held  that  the voters,   in supporting                                                               
      passage  of the  CBR resolution  in  1990,  were not  trying                                                              
      to eliminate   state  services  or liquidate   state  assets                                                              
      before funds  in  the CBR  could  be accessed  (Hickel,  874                                                              
      P. 2d at 928).                                                                                                            
      Categories  of funds  that  are not  immediately   spendable                                                              
           o     illiquid assets                                                                                                
           o     revolving loan funds                                                                                           
           o     grants to the state from private entities                                                                      
Ms. Sorum-Birk commented that the intent was related to                                                                         
Governor Cowpers argument that all funds were considered                                                                        
Ms. Sorum-Birk highlighted Slide 9 titled "Legislative                                                                          
Intent 6                                                                                                                        
       The  legislature   finds  that   funds  considered   to  be                                                              
      trust  receipts,  despite   being  included  in  the  metric                                                              
      for calculating   what  is available,   are to  be  excluded                                                              
      from the  sweep?  It is  the intent  of the  legislature  to                                                              
      include  this  principle  in  the  codified   definition  of                                                              
      'available   for   appropriation'    and   to   clarify   in                                                              
      statute  the   principle   that  trust   receipts   are  not                                                              
      fully subject to the sweep provision."                                                                                    
           If actually appropriated must be included in                                                                         
           "available for appropriation"                                                                                        
           Only a portion is available according to Hickel -                                                                    
           the part that would be expended consistent with                                                                      
           application of prudent "trust principles"                                                                            
Ms.  Sorum-Birk  observed  that  the  court  ruling  employed  the                                                              
phrase    trust  receipts    multiple  times   but  the  term  was                                                              
meaningless   in  relation  to  audits.  She  noted  that  in  the                                                              
ruling  footnotes   22 and  23  outlined  that  trust  principles                                                               
were  the key  component  of  what  funds  were  sweepable.  Trust                                                              
receipts  included   federal  funds,  funds  given  to  the  state                                                              
for    specific    purposes    from    private    entities,    and                                                              
appropriations   from  trust  accounts.  She  read  from  footnote                                                              
23   Amounts  appropriated   by  the  legislature   out  of  other                                                              
funds   with   an   executive   agency   for   the   purposes   of                                                              
administering     these    funds   under    explicit     statutory                                                              
authority may also be treated as a type of trust receipt.                                                                       
Vice-Chair  Ortiz  asked  about  the category  of  trust  receipts                                                              
and  the  historic  way  the sweep  had  been  handled.  He  asked                                                              
about  the  impact  once trust  receipts   were removed  from  the                                                              
sweep  and  if  it  would  result  in  a reduction   in  sweepable                                                              
funds.  Ms.  Sorum-Birk   answered  that  the  majority  of  trust                                                              
receipts    were   already   considered    not   sweepable.    She                                                              
deferred  to  the  legislative   auditor  to  provide  details  on                                                              
what were currently considered trust receipts.                                                                                  
KRIS   CURTIS,   LEGISLATIVE    AUDITOR,    ALASKA   DIVISION   OF                                                              
LEGISLATIVE   AUDIT,  answered  that  trust  receipts  was  not an                                                              
accounting  term.  She  elaborated  that  the term   Trust  Funds                                                               
was  commonly  used and  was explicitly   defined  in statute  and                                                              
had  a different  meaning  than  the use  of trust  receipts.  She                                                              
had  heard federal  funds  were  considered  trust  receipts.  She                                                              
had  never   encountered   trust  receipts   used  in  accounting                                                               
1:58:50 PM                                                                                                                    
Vice-Chair   Ortiz  asked   about  the  fiscal   impact  of  trust                                                              
receipts  if  the  bill  was adopted.   Representative   Josephson                                                              
replied  that  it was  necessary  to look  at July  2019  when the                                                              
last  sweep occurred.   He did  not recall  whether  OMB  included                                                              
trust receipts in the sweep.                                                                                                    
Ms.  Sorum-Birk  examined   Slide  9 titled   Legislative   Intent                                                              
      O  "The  Hickel   Court   treated  money   appropriated   by                                                              
      state   corporations    much   the   same   way   as   trust                                                              
      O Alaska  Energy  Authority  is  a  state  corporation  that                                                              
      holds  the   Power   Cost  Equalization    (PCE)   endowment                                                              
      fund. The  PCE  is  not subject   to sweep  or  part  of the                                                              
      general fund for 4 reasons-                                                                                               
           1) This fund is housed in a corporation                                                                            
           2) PCE follows an endowment model which requires                                                                   
              application of prudent "trust principles"                                                                         
           3) Hickel says that only the money appropriated                                                                    
              from    a   corporation    must   be    counted   as                                                              
              available     for   appropriation,     even   if   a                                                              
              corporation    had  funds  in  excess   of  what  it                                                              
              required to fulfill its purpose                                                                                   
           4) The legislature has never fully appropriated                                                                      
           the funds and it is unlikely that it would do so,                                                                    
           as that would defy the very purpose of the fund                                                                      
Ms.  Sorum-Birk   elaborated   that  the  slide   was  related  to                                                              
footnote   23  in the   court  case.  The  case  considered   that                                                              
money  appropriated   from  Alaska   Industrial  Development   and                                                              
Export   Authority    (AIDEA)    and   Alaska   Housing    Finance                                                              
Corporation   (AHFC)  counted   as  available  for  appropriation                                                               
but only the amount appropriated.                                                                                               
2:01:15 PM                                                                                                                    
Ms. Sorum-Birk spoke to Slide 10 titled legislative intent                                                                      
      O  "The  legislature   finds  that   the  earnings   reserve                                                              
      account,  as  an account   in the  Alaska   permanent  fund,                                                              
      is located  outside  of the  general  fund  and thus  is not                                                              
      subject  to  the  sweep  provision?   It is  the  intent  of                                                              
      the legislature   to codify  fund  types that  exist  in the                                                              
      state  treasury   separately   from  the  general   fund  to                                                              
      eliminate  all  uncertainty   as  to what  constitutes   the                                                              
      general fund."                                                                                                            
           O Hickel- "the earnings reserve account, need not                                                                    
           be deposited into the budget reserve." (Hickel,                                                                      
           874 P. 2d 922, 23)                                                                                                   
Ms.  Sorum-Birk   illustrated   that   if  the  logic   of  former                                                              
Attorney  General  Clarkson   had  been followed,   funds  similar                                                              
in  use   to  GF  would   make   the  funds   GF.  Therefore,   if                                                              
something  could  be appropriated   by  the legislature   it would                                                              
count as GF, which was a cause of concern.                                                                                      
Representative    Josephson   interjected    that   in  Hickel   v                                                              
Cowper   there  was   no  other   use  of   the  ERA  except   for                                                              
inflation   proofing   and   paying   Permanent   Fund   dividends                                                              
(PFD).  In  relation  to  former  AG Clarksons    interpretation,                                                               
it  left   open  the   possibility   that  constitutionally    the                                                              
Earnings  Reserve  Account   (ERA)  could  be sweepable   although                                                              
statutorily, it is not.                                                                                                         
2:02:54 PM                                                                                                                    
Ms.  Sorum-Birk  examine  Slide  11  titled   legislative   intent                                                              
number 9:                                                                                                                       
      "It is the intent of the legislature to define                                                                            
        eneral fund' in a way that is practical, logical,                                                                       
      and stabilizing in nature."                                                                                               
           O No statutory or constitutional definition for                                                                      
           the term "general fund" exists                                                                                       
           O Occurs 200+ times throughout statute                                                                               
           O Lack of consistency between organizations -                                                                        
           currently a matter of policy rather than law                                                                         
           O It is common practice in other states to define                                                                    
           'general fund'                                                                                                       
Ms.  Sorum-Birk    addressed   Slide  12   titled  "What   is  the                                                              
General Fund:"                                                                                                                  
      .notdef There isn't consensus between state agencies                                                                      
      .notdef In budgeting terms, we are used to thinking in terms                                                              
      of UGF, DGF, Federal and Other                                                                                            
           .notdef These categories don't align with the accounts                                                               
           in the state treasury                                                                                                
      .notdef The CAFR says                                                                                                     
           .notdef "All public monies and revenues coming into the                                                              
           state   treasury   not  specifically    authorized   by                                                              
           statute  to  be placed  in a  special  fund constitute                                                               
           the General Fund"                                                                                                    
           .notdef But also notes - "Not all  revenues  that  flow                                                              
           into  the  General   Fund  are  available  to  pay  for                                                              
           unrestricted    government    activities.    The   most                                                              
           notable  are  federal  revenues,   which  are  provided                                                              
           for specific purposes."                                                                                              
      .notdef It is common practice in public finance to define                                                                 
      general fund                                                                                                              
Ms. Sorum-Birk reported that the bill adopted a broad                                                                           
definition that spoke to how GF existed as an account in                                                                        
the state treasury.                                                                                                             
2:05:07 PM                                                                                                                    
Ms. Sorum-Birk turned to Slide 13 titled definition of the                                                                      
general fund:                                                                                                                   
      The primary  operating  fund  of  the state,  consisting  of                                                              
      all  money  paid  into  the  state   treasury  that  is  not                                                              
      specifically   authorized   by  law   to  be  placed   in  a                                                              
      separate fund                                                                                                             
           Funds   held    or   managed   by   legally    separate                                                              
           entities     that    the    state    is    financially                                                               
           accountable   for  including   funds  held  or  managed                                                              
           by   public  corporations    and  the   University   of                                                              
                   enterprise funds                                                                                             
                 ? debt service funds                                                                                           
                 ? special revenue funds                                                                                        
                 ? the Alaska permanent fund                                                                                    
                 ? internal service funds                                                                                       
                 ? agency funds                                                                                                 
Ms.  Sorum-Birk   indicated   that  the  definition   was  adapted                                                              
from   the   Comprehensive   Annual   Financial    Report   (CAFR)                                                              
definition.   The slide   noted  the items  not  included   in the                                                              
Ms. Sorum-Birk highlighted Slide 14 titled Summary of                                                                           
principles from Hickel v Cowper used in defining "available                                                                     
for appropriation"                                                                                                              
      .notdef Two main parameters:                                                                                              
      .notdef "must include all funds over which the  legislature                                                               
      has retained power to appropriate" and                                                                                    
      .notdef "which are not available to pay expenditures without                                                              
      further legislative appropriation"                                                                                        
      .notdef For trust receipts the amount appropriated   by  the                                                              
      legislature IS the amount available for appropriation                                                                     
      .notdef This category includes federal funds, funds given to                                                              
      the  state  for  specific   purposes  by  private   entities                                                              
      AND appropriations from trust account                                                                                     
      .notdef Notably "amounts appropriated by the legislature out                                                              
      of  other   funds   within  executive    agencies   for  the                                                              
      purpose  of  administering   these  funds,  under   explicit                                                              
      statutory  authority  may  also  be  treated  as  a type  of                                                              
      trust receipt" (revolving loan funds)                                                                                     
      .notdef Monies of public corporations are treated  similarly                                                              
      to trust receipts                                                                                                         
      .notdef Excludes illiquid assets, funds expendable   without                                                              
      further  legislative    appropriation,   or  funds   validly                                                              
2:07:10 PM                                                                                                                    
Ms. Sorum-Birk reviewed Slide 16 titled goal in summary on                                                                      
slide 15.                                                                                                                       
      HB 57 aims  to  enact by  law section  Article  IX,  Section                                                              
      17  (d)  of  the  Alaska  Constitution   thereby   providing                                                              
      legal clarity on the sweep provision.                                                                                     
      It does this by:                                                                                                          
           .notdef defining 'available for appropriation' using an                                                              
           understanding    of   parameters   set   in  Hickel   v                                                              
           Cowper    and   thereby    correcting    the    largely                                                              
           unconstitutional AS 37.10.420 (a)(1)                                                                                 
           .notdef defining 'general fund' in a way that  reflects                                                              
           the   actual    mechanics   of   state    finance   and                                                              
           clarifying   what fund  types  are  excluded  from  the                                                              
           general fund                                                                                                         
           .notdef formally addressing which funds within the                                                                   
           general fund cannot be swept and why                                                                                 
Ms.  Sorum-Birk   reminded   the  committee  that  resolving   the                                                              
issue  was   a   constitutional   obligation    since   1994.  She                                                              
warned   of   the   need   for  a   unified   understanding    and                                                              
codification   of  principles.   She  cautioned  against   leaving                                                              
it up to a matter of administrative policy.                                                                                     
Representative   Josephson  remarked  that  he had  been  involved                                                              
in  the uncodified   language,  which  was  unique  when  drafting                                                              
the  bill.  He  emphasized  that  courts  want  to  consider  what                                                              
the  intent  of the  law  was, and  inclusion  of  the uncodified                                                               
language  was  a  way  to  establish  the  intent  to  follow  the                                                              
guidance   rendered  from  the  Hickel  v.  Cowper   decision.  He                                                              
mentioned  that  there  were  a  number  of  accounts  created  by                                                              
the  legislature,  but  the court  had  specified  that the  Spill                                                              
Prevention   and   Response   Fund   (SPAR)  was   not   sweepable                                                              
because   of  the  unpredictable   nature   of  a  spill  and  the                                                              
emergency  response  necessary   to clean  it up.  He pointed  out                                                              
that  a number  of other  funds  were similar  in  that they  were                                                              
set  up to  be  self-sustaining.   The judgment   suggested  those                                                              
type  of  funds   was  also  not  sweepable.   He  felt  that  the                                                              
legislature   had the  advantage  of  using  Hickel  v. Cowper  as                                                              
a   roadmap  to  create  statute.    He  stressed  that  the  bill                                                              
should  not  move  from   committee  at  present  but  emphasized                                                               
that  it   should  in   2022  and  was   the  obligation   of  the                                                              
Vice-Chair  Ortiz  cited  a  document  titled  "Funds  Subject  to                                                              
CBR   Sweep--FY17-FY19,"     dated   July   18,   2019,   by   the                                                              
Legislative  Finance  Division   (copy on  file).  He interpreted                                                               
that  only  the  funds  marked  by  a  green   Y   were  sweepable                                                              
under   HB  57.   Representative   Josephson    deferred   to  Ms.                                                              
Sorum-Birk for the answer.                                                                                                      
Ms.  Sorum-Birk   replied  that  the  document   was  created  for                                                              
the  meetings  in  FY  19 and  depicted  the  disagreement   among                                                              
the  agencies   regarding  what  items  were   sweepable  or  not.                                                              
She  noted  that  the  funds  in green  had  unanimous   agreement                                                              
that  the  funds  were   sweepable.  She  pointed   to  the  three                                                              
columns  located   in  the  center  of  the  document  reflecting                                                               
each  fiscal  year  and noted  that  they  portrayed  consistency                                                               
in  agreement  over  whether  certain   funds  were  sweepable  or                                                              
not.  She cited  notation  in the  far  right column   Not  a fund                                                              
based  on review  of IRIS  for  FY 19."  She indicated  that  many                                                              
items   on  the   list   were   receipts   and   not  funds.   She                                                              
clarified  that  the  item had  to be  a fund  to  be included  in                                                              
the calculus as to whether something was sweepable.                                                                             
2:13:48 PM                                                                                                                    
Vice-Chair   Ortiz  asked  if  it was  the  intent  of  the  chart                                                              
was  to  communicate   that   there  was  a  consensus   that  the                                                              
items  in   green  were  sweepable.   He  asked   if  it  was  the                                                              
intent  to  define  funds  that were  sweepable.   Ms. Sorum-Birk                                                               
answered  in  the negative   and added  that  the  items had  been                                                              
added by the Legislative Finance Division.                                                                                      
Co-Chair Merrick OPENED public testimony.                                                                                       
MIKE  COONS,  SELF,  PALMER  (via  teleconference),   opposed  the                                                              
bill.  He  believed   that  the  bill  would  violate   the  state                                                              
constitution.   He  pointed  to page  8,  lines  5 through   7 and                                                              
read  "Funds  established  within  the general  fund  that  by law                                                              
require  no  further  appropriation   before  expenditure   or are                                                              
required  to  be  held  separately   by law  are  not  subject  to                                                              
art.  IX, sec.  17(d),  Constitution   of  the State  of  Alaska."                                                              
He  stated  that  it was  not  possible  to  create  a statute  to                                                              
 get  around  the  constitution.   He  emphasized   that like  the                                                              
CBR,  the use  of the  so called  sweep  requires  the same  three                                                              
quarter  vote  as does  the  CBR. He  thought  that  the bill  was                                                              
an   opportunity   to   clear   up   the  issue    to  allow   the                                                              
legislature   to  spend  more.  He  expressed  outrage   regarding                                                              
an attack on the constitution.                                                                                                  
Co-Chair Merrick CLOSED public testimony.                                                                                       
Co-Chair  Merrick  asked  to hear a  review of  the fiscal  note.                                                               
CAROLINE  SCHULTZ,   POLICY  ANALYST,  OFFICE  OF  MANAGEMENT  AND                                                              
BUDGET,  OFFICE  OF THE  GOVERNOR,  referenced   the Statement  of                                                              
Zero  Fiscal  Impact  by the  Office  of  Management  and  Budget.                                                              
She  explained  that  implementation   of  the legislation   would                                                              
not require additional funding.                                                                                                 
HB   57  was   HEARD   and   HELD   in   committee   for   further                                                              
2:18:08 PM                                                                                                                    
AT EASE                                                                                                                         
2:19:37 PM                                                                                                                    
HOUSE BILL NO. 54                                                                                                             
      "An  Act   establishing    the  Alaska    Invasive   Species                                                              
      Council  in  the Department   of  Fish  and  Game;  relating                                                              
      to   management   of   invasive    species;    relating   to                                                              
      invasive  species  management   decals;  and  providing  for                                                              
      an effective date."                                                                                                       
2:19:47 PM                                                                                                                    
REPRESENTATIVE     GERAN    TARR,    CHAIR,    HOUSE     FISHERIES                                                              
COMMITTEE,   SPONSOR,  shared  the  history  of the  legislation.                                                               
She  indicated   that  former  Representative    Paul  Seaton  had                                                              
requested   she  take  over  working   on  a bill  addressing   an                                                              
emergency   response   to  the   invasive   species  Elodea.   She                                                              
explained  that  the  spread  was so  aggressive   it advanced  to                                                              
a  much  costlier  problem   by the  time  permits   necessary  to                                                              
address    the    problem    were    issued.    She   worked    in                                                              
collaboration   with  the  Alaska  Invasive  Species  Partnership                                                               
and  discovered  a more  comprehensive   model of  addressing  the                                                              
problem.  She  explained  that  the model  would  employ  bringing                                                              
together   all  the  stakeholders  involved   in  the  issue.  She                                                              
exemplified   the Zebra  Mussel  problem  in  Michigan  where  the                                                              
mussels  multiplied   so  rapidly,   they  clogged  a  main  water                                                              
pipe  and  shutdown  municipalities    water  systems.  She  spoke                                                              
to  the  advantages  of  collaboration   between   government  and                                                              
private   entities  to  address   the  invasive  species   issues.                                                              
She   noted  the   different   industries   that   could   act  as                                                              
vectors  of  introduction   of  invasive  species  i.e.,  the  oil                                                              
and  gas  industry,  construction,   and shipping   industry.  She                                                              
exemplified    that  the   Department    of  Transportation    and                                                              
Public  Facilities   (DOT)  in acknowledgement   of  the  invasive                                                              
species  problem,  revegetated   any  fill  projects  with  native                                                              
vegetation.   She  noted  the  broad  interest   in  bringing  the                                                              
comprehensive   model to  Alaska.  Currently,  the  state  spent a                                                              
few  million   dollars  in  invasive   species  management   while                                                              
other  states  spent up  to hundreds  of  millions  of dollars  to                                                              
address the issue.                                                                                                              
2:23:20 PM                                                                                                                    
Rep.  Tarr  continued   that  invasive  species  problems   became                                                              
large   and  costly.   The   advantage   to  get   ahead   on  the                                                              
prevention   side  was  the  likelihood   of  mitigation   costing                                                              
much  less,  which  the  collaborative  model  could  accomplish.                                                               
She  related  that  the  bill  was  vetted  at  a meeting   of the                                                              
Alaska   Invasive   Species  Partnership    that  provided   input                                                              
from  all over  the state.  She  offered  that HB  54 created  the                                                              
Alaska  Invasive  Species  Council  and  defined  the issues  they                                                              
could  address.   The  idea  was  to  get  the  multi-stakeholder                                                               
group   together,   which   was   the   most  effective    use  of                                                              
resources.   She noted  that  the  collaborative   and prevention                                                               
work  would  effectively   address   larger  threats   looming  in                                                              
the  future.   She  delineated   that   the  bill  established   a                                                              
response   fund   and   for   the   sale   of  invasive    species                                                              
management  decals.   She had  explored  many  ideas  for  funding                                                              
but  currently   the   sale  of   decals   was  chosen   to  avoid                                                              
starting  out  with a  mandate.  She shared  that  former  Senator                                                              
Gary  Wilken  had come  up  with the  idea  of a  decal and  noted                                                              
the  general  enthusiasm   people  had  towards   the  issue  with                                                              
the  hope  of  generating  decal   sales.  She  relayed  that  the                                                              
bill  was  a House  Fisheries   Committee  bill  and  the  members                                                              
wanted  to  find   alternative   funding  for  the   $28  thousand                                                              
fiscal   note   related   to  the   council   other   than   suing                                                              
undesignated general funds (UGF).                                                                                               
2:27:26 PM                                                                                                                    
Representative   Tarr communicated   the  intent  language  in the                                                              
bill on Section 1, page 1, lines 7 through 10 as follows:                                                                       
      LEGISLATIVE    INTENT.    It   is   the   intent    of   the                                                              
      legislature   that   the  Department   of   Fish   and  Game                                                              
      support  the activities   of  the Alaska  Invasive   Species                                                              
      Council,     established     by    this     Act,     through                                                              
      contributions,  grants,  and  other  forms  of funding  that                                                              
      do  not  involve   the  use  of   money  from  the   state's                                                              
      general fund.                                                                                                             
2:28:12 PM                                                                                                                    
THATCHER    BROUWER,    STAFF,    REPRESENTATIVE    GERAN    TARR,                                                              
reviewed the sectional analysis (copy on file):                                                                                 
      Section  1: Adds  a  new  section  to  uncodified  law  that                                                              
      states  it  is the  intent   of the  legislature   that  the                                                              
      Department  of  Fish  and  Game  does  not  use  money  from                                                              
      the  state's    general   fund   to   support   the   Alaska                                                              
      Invasive   Species   Council,   and  instead   finds   other                                                              
      sources of funding to support the council.                                                                                
      Section  Two:   AS  16.20.800   establishes   the   invasive                                                              
      species  management  decals.  The  decals will  be  produced                                                              
      by the  Department   of Fish  and  Game  annually  and  made                                                              
      available  for  sale  to  the  public  for  a $20  fee.  The                                                              
      department  will   work  in  conjunction   with  the  Alaska                                                              
      Invasive  Species   Council  described   in Sec.   16.20.810                                                              
      to design  and  produce  the  decals.  The  legislature  may                                                              
      then  appropriate   the  proceeds   from  the  sale  of  the                                                              
      decals   to  further   produce   the   decals   or   to  the                                                              
      invasive   species   response   fund   described   in   Sec.                                                              
      16.20.820,  to  carry  out  the  work  of invasive   species                                                              
      Section   16.20.810   establishes    the   Alaska   Invasive                                                              
      Species  Council  in  the  Department   of  Fish  and  Game.                                                              
      The council  will  be  comprised  of  representatives   from                                                              
      the Departments   of  Fish  and  Game,  Natural  Resources,                                                               
      Environmental    Conservation    and   Transportation    and                                                              
      Public Facilities.                                                                                                        
      Furthermore,   the   council    will   have   members   from                                                              
      stakeholder  organizations   and  industries   appointed  by                                                              
      the   governor   to    three-year   terms,    as   well   as                                                              
      representatives   from  federal  agencies   that  deal  with                                                              
      invasive species.                                                                                                         
      Additionally,     Section     16.20.810     outlines     the                                                              
      responsibilities   of the  council.  This  section  requires                                                              
      that  the   council   be   responsible    for  facilitating                                                               
      cooperation   between   state,   federal,    tribal,   local                                                              
      agencies,   and  nongovernmental    organizations    in  the                                                              
      management   invasive   species.    The  council   will   be                                                              
      tasked   with    recommending    coordinated    interagency                                                               
      strategies  and  policies   related  to  the  management  of                                                              
      invasive   species.   The   council    will   also   provide                                                              
      guidance  on how  to prioritize   the response  to  invasive                                                              
      species  and  how  to  best  use  funds  from  the  invasive                                                              
      species response fund.                                                                                                    
      Lastly,  the council   will  be responsible   for  selecting                                                              
      designers  of  the  invasive  species   control  decals  and                                                              
      approving and promoting the designs.                                                                                      
      Furthermore,   Section   16.20.810   provides  guidance   on                                                              
      council  meetings   and  deliverables.   The  council   will                                                              
      meet at  least once  a year,  and  by January  15th  of each                                                              
      odd-numbered   year,  the  council  shall   produce  a  plan                                                              
      that addresses  the  economic  impact  of  invasive  species                                                              
      and  recommends   legislation   and  funding  to   implement                                                              
      the council's priorities.                                                                                                 
      Section   16.20.820   establishes    an  invasive    species                                                              
      response  fund   in  the   general   fund  and  allows   the                                                              
      department  to  use  the  funds  to  prevent,   control,  or                                                              
      eradicate invasive species.                                                                                               
      Section   16.20.850    defines    commissioner,     council,                                                              
      department,   invasive  species,   management   of  invasive                                                              
      species and non-native species.                                                                                           
      Section  Three:   Section   37.05.146   adds  the   invasive                                                              
      species  decal  fee to  the  list of  separately   accounted                                                              
      program receipts.                                                                                                         
      Section  4:  Gives  direction  to  the  governor   regarding                                                              
      the  appointment   of  the  members,   chair,   as  well  as                                                              
      timing and number of meetings in the initial year.                                                                        
      Section 5: Establishes an immediate effective date.                                                                       
2:31:48 PM                                                                                                                    
Representative   Josephson  asked  Representative   Tarr for  more                                                              
detail    about   the   large   meeting    she   had   mentioned.                                                               
Representative    Tarr  responded    that  the   Alaska   Invasive                                                              
Species  Partnership   was  a  nonprofit  organization   that  met                                                              
annually,   and  she  had   attended   the  annual  meeting.   She                                                              
elucidated   that  the members   of the  partnership   wanted  the                                                              
creation  of  the  council  to use  the  work  of the  experts  in                                                              
the partnership to help develop state policy.                                                                                   
Representative   LeBon  stated  that  the  House  had  passed  the                                                              
enhanced    sport    fishing     license    [HB    79    Saltwater                                                              
Sportfishing    Operators/Guides]     to   help   fund    invasive                                                              
species  eradication.   He  asked  how  to  connect   the  funding                                                              
source    to    the    legislation    before     the   committee.                                                               
Representative    Tarr   answered   that   Representative    Sarah                                                              
Vance  had   introduced   an  amendment  that   part  of  the  fee                                                              
increase  could  be  used  for invasive   species  management  and                                                              
was  hoping  for  complete  passage  of  the  bill.  In  addition,                                                              
the  Commissioner   of   the Department   of  Fish and  Game  Doug                                                              
Vincent-Lang,   revealed   that  some   grant  funding   would  be                                                              
2:34:29 PM                                                                                                                    
Representative   Wool  thought  that  the  decal  program  sounded                                                              
interesting   and at  $20  a  decal  it could  raise  substantial                                                               
funding.  He  asked  for  details  regarding   the decal  and  how                                                              
much funding was anticipated from the sales.                                                                                    
Representative   Tarr  relayed   that  the  commissioner   thought                                                              
the  fiscal  note could  be  corrected  downward.   She cited  the                                                              
fiscal  note  analysis   that stated     to  develop  an  invasive                                                              
species  management   decal  with  the  council   and  offer  them                                                              
for   sale  to   the  public   for   $20  each.   The  department                                                               
estimates   to  collect   $3.9  annually     She  referenced   the                                                              
Fish  and Game  website  that  had numerous  items  available  for                                                              
purchase   online.   She  listed   other  potential   efforts   to                                                              
promote   the   decal   and  remarked    that  the   fiscal   note                                                              
estimate   was  low.  She   mentioned   the  possibility   of  the                                                              
council   creating   a  decal  design   contest.   Representative                                                               
Wool  suggested  selling  the decals  at fishery  supply  stores.                                                               
2:37:11 PM                                                                                                                    
Vice-Chair   Ortiz  cited  facts   from  the  sponsor  statement,                                                               
 Invasive   species   are   costing   Alaska   money  (Almost   $6                                                              
million  a  year  to manage  according   to a  2012  ISER  study)                                                               
and   It  was  estimated  in  2005  that  invasive   species  cost                                                              
the   United  States   $120   billion   in  damages   every   year                                                              
according  to  a US  Fish  and Wildlife  Fact  Sheet  on the  Cost                                                              
of  Invasive  Species.   He  asked  how the  problem  had  evolved                                                              
since  2012  and  whether  the  issue  created   more  of a  water                                                              
problem   rather   than   land   problem.   Representative    Tarr                                                              
replied  that  some  of the  studies  were  not more  recent  than                                                              
2012.  She referenced   the document  titled    Managing  Invasive                                                              
Species:   How  Much  Do  We  Spend?   included   in  the  members                                                              
packets.   She  delineated    that  the  paper   was  written   by                                                              
University   of  Alaska  researchers   who  discovered   that  the                                                              
impacts  to salmon  could  be  hundreds  of millions  of  dollars.                                                              
She  referenced   the  huge  cost  of  zebra  mussel  mitigation.                                                               
The   cost   of   impacts   to   hydroelectric    facilities   and                                                              
municipal   water  supplies  were  astronomical.    She  mentioned                                                              
some  examples  of  how  invasive  species   were  introduced  and                                                              
spread   particularly   with   Elodea.  She   expounded   that  it                                                              
depended   on  the  species   as  to  the  type  of   impact.  She                                                              
reported   that  Tammy  Davis   [Invasive   Species  Coordinator,                                                               
Department   of Fish  and  Game]  had  testified  about  the  work                                                              
DFG was doing to mitigate invasive species.                                                                                     
Co-Chair  Merrick   asked  if  there  was  any  liability  in  the                                                              
case  mentioned    about  an  individual    dumping  an   aquarium                                                              
causing   an outbreak.   Representative   Tarr   answered  in  the                                                              
negative.   She   referenced    a  case   noted   in  information                                                               
provided  by  Ms.  Davis  in  the  form  of  a PowerPoint   titled                                                              
 Department   of   Fish   and  Game   Invasive   Species   Program                                                              
Report:  2021   on  slide  13  and  read   In  2019,  144  rainbow                                                              
trout  were illegally   imported  from a  hatchery  in Oregon  and                                                              
then  illegally   released  into   a closed   lake  on  the  Kenai                                                              
Peninsula.    She  indicated   that  the  responsible  individual                                                               
was  identified    and  fined,   but  that   was  an  exceptional                                                               
2:41:59 PM                                                                                                                    
Representative    Thompson   shared    that   he  was   aware   of                                                              
invasive  species  mitigation  work  for  years.  He spoke  to how                                                              
invasive  species   spread  in  the interior.   The  Harding  Lake                                                              
Association   was trying  to  raise  its own  funds  to  eradicate                                                              
Elodea.  He  asked how  the  funds  from the  sale  of the  decals                                                              
would  be distributed.   Representative   Tarr answered   that the                                                              
council  would  develop   a strategic   plan and  help  the  state                                                              
prioritize  the  funding.  She  expected  that some  of the  funds                                                              
would  come  back   to  Harding  Lake  since  Elodea   spread  was                                                              
Co-Chair Merrick moved to invited testimony.                                                                                    
2:44:30 PM                                                                                                                    
AARON   MARTIN,  UNITED   STATES   FISH  AND   WILDLIFE   SERVICE,                                                              
ANCHORAGE   (via  teleconference),   relayed  that  he  worked  in                                                              
the  regional  office  in Anchorage   and was  asked  to speak  to                                                              
the  technical   aspects   of   invasive  species   projects   the                                                              
service   was  involved   in.  He  elaborated   that   the  United                                                              
States   Fish  and  Wildlife   Service   (USFWS)  worked   on  all                                                              
types  of  invasive  species  on  land  and  water.  The  agencys                                                               
main   task  was  to   prevent   the  introduction   of   invasive                                                              
species  in  the U.S.  The  service  was working   with state  and                                                              
federal   partners  to  identify   what  species   may  arrive  in                                                              
Alaska,   were  already   here,  and   work  on  prevention.   The                                                              
agency    worked    with    ADFG,    Alaska    Invasive    Species                                                              
Partnership, and the Department of Natural Resources (DNR).                                                                     
Mr.   Martin  emphasized    that  prevention    was  the   key  to                                                              
success   in invasive   species   management.   He reported   that                                                              
Alaska   had  relatively   few   invasive   species  compared   to                                                              
other   states.  He   listed  some   species:   Elodea,   Northern                                                              
Pike,   and  a  suite   of  terrestrial   invasive   plants   that                                                              
varied  in  impacts.   He  voiced  that  the  more  collaborative                                                               
and  community  based  the effort  was  the more  likely  invasive                                                              
species  could   be managed   and  kept  in small   outbreaks.  He                                                              
noted  that   one  project   was  focused   on  preventing   Zebra                                                              
Mussels  from  arriving  in the  state on  the ALCAN  Highway.  He                                                              
shared   that   USFWS   had   conducted   a   pilot   project   to                                                              
understand  the  level  of risk  from watercraft   being  towed to                                                              
Alaska.  He reported   that 70  percent  of the  vessels  arriving                                                              
via  highway  was  not  being  inspected  by  a large  network  of                                                              
watercraft   inspections   stations   across  the   west,  and  38                                                              
percent  of  the  boats   had  come  from  states  with   infected                                                              
waters.  He noted  the  discovery  of a  sailboat  encrusted  with                                                              
zebra  mussels  that  arrived  in  Alaska  in  2019  that  luckily                                                              
had  not  become  a threat.   The service   worked  with  Canadian                                                              
watercraft    inspection    agencies,   state    Fish   and   Game                                                              
agencies,   and  Customs  and  Border  protection   to  set  up an                                                              
inspection   project  on  the Alcan  that  discovered   a jet  ski                                                              
that  had  been   test  driven   on  Lake  Powell  infested   with                                                              
zebra    mussels.     He    remarked     that    the     detection                                                              
infrastructure    was  available   but   needed   to  expand.   He                                                              
emphasized   that   much   more  collaboration    and  inspection                                                               
infrastructure   was  warranted.  He  related  a  recent  incident                                                              
in  Alaska  where  moth   balls  were  quarantined   because  they                                                              
carried zebra mussels on them.                                                                                                  
2:49:34 PM                                                                                                                    
Mr.   Martin  continued    that  the   incident   underlined   the                                                              
threat   and  need  for   collaboration.   He  pointed   to  Dutch                                                              
Harbor  being  an  international   shipping  platform  for  Alaska                                                              
in  addition  to  its  rank  as  the top  US  commercial   fishing                                                              
port   by   volume    and   a   major   hub   for    barges   from                                                              
international   waters.  He noted  that  some of  the barges  came                                                              
from  the most  infested  bays  and waterways  in  the world  like                                                              
Southeastern    Asia,  Central   and   South   America,   Port  of                                                              
Vancouver,   Port   of  Tacoma,   and  San   Francisco   Bay.  The                                                              
infrastructure   and  coordination   were  currently   lacking  to                                                              
offer  a  rigorous  detection   and rapid   response  program.  He                                                              
emphasized   that  the  key  to  success   was  coordination   and                                                              
2:51:27 PM                                                                                                                    
Co-Chair Merrick OPENED public testimony.                                                                                       
DANIELLE   VERNA,  ENVIRONMENTAL   MONITORING   PROGRAM   MANAGER,                                                              
PRINCE   WILLIAM  SOUND   REGIONAL  CITIZENS   ADVISORY   COUNCIL,                                                              
VALDEZ  (via   teleconference),   testified   in  support  of  the                                                              
legislation.   She  reported   that   the  Prince  William   Sound                                                              
Regional    Citizens    Advisory   Council    (PWSRAC)    was   an                                                              
independent    nonprofit    corporation     that   promoted    the                                                              
environmentally-safe     operation    of    the   Valdez    Marine                                                              
Terminal     and    associated    tankers.     The    18    member                                                              
organizations   were   comprised  of  the   communities   affected                                                              
by  the    Exxon   Valdez  oil   spill,  as    well   as  fishing,                                                              
aquaculture,     Alaska   Native,   tourism,   and  environmental                                                               
groups.   She  delineated   that   the  council   recognized   the                                                              
significant     threat    invasive    species     pose   to    the                                                              
environmental   and economic  health  of  the state.  Creation  of                                                              
the  Alaska   Invasive  Species  Council   was an  important  step                                                              
towards    collaboratively      addressing    invasive     species                                                              
prevention    and    management    and   recognized     that   the                                                              
continually   evolving   threat  of  invasive   species   required                                                              
resources  for  a  rapid  response.   The council   supported  the                                                              
development  of  a 5-year  plan  and establishment   of a  funding                                                              
mechanism.   She  applauded  the  bill  for  including   the  need                                                              
for  both  prevention  and  response  for  marine  and freshwater                                                               
environments.   She  detailed  that  commercial   shipping   was a                                                              
potential   vector  for  invasive  species   from  ballast  water.                                                              
The   tankers   arriving   in   Prince   William   Sound   deliver                                                              
roughly   90  percent(11   million   metric   tons)  of   all  the                                                              
balast  water  in the  state  sourced  from  highly  invaded  port                                                              
systems  on  the    U.  S.  West  Coast.   The  council  had  long                                                              
advocated  for  effective   policies,  sampling,   and monitoring                                                               
to prevent introductions.                                                                                                       
2:55:03 PM                                                                                                                    
Co-Chair Merrick CLOSED public testimony.                                                                                       
Co-Chair  Merrick   asked  for  a  review  of  the  fiscal  notes.                                                              
She noted  the  published  fiscal note  from DFG  [FN 2  (DFG)}.                                                                
DOUG  VINCENT-LANG,    COMMISSIONER,   DEPARTMENT   OF   FISH  AND                                                              
GAME  (via teleconference),   shared  that  invasive  species  was                                                              
a   continual    challenge     for   the    department    due   to                                                              
increasingly   more  vectors  and  threats  of invasive   species.                                                              
He initially   worked  with the  sponsor  on the  bill because  of                                                              
its  focus  on  granting   more  regulatory   authority   for  the                                                              
department   rather  than  forming  a  strategy   on how  to  deal                                                              
with  the issue.  Currently,   the department  was  supportive  of                                                              
the  bill  and  the  creation  of  a council   to  help  determine                                                              
what   regulatory   aspects   were   necessary   to  address   the                                                              
issues.  The  department  did not  believe  UGF  was necessary  to                                                              
fund  the work  of  the council.   He noted  the  availability  of                                                              
grants  through  the  USFWS  and other  entities   to support  the                                                              
Co-Chair   Merrick  stated   that  the   other  published   fiscal                                                              
note  was  for   the Department   of Environmental   Conservation                                                               
(DEC) [FN 1 (DEC)].                                                                                                             
2:57:38 PM                                                                                                                    
LAURA     ACHEE,    LEGISLATIVE     LIAISON,     DEPARTMENT     OF                                                              
ENVIRONMENTAL    CONSERVATION   (via   teleconference),    relayed                                                              
that  the department's   fiscal  note  was  zero.  She added  that                                                              
the  council   included  a  seat  for  the  Commissioner   of  the                                                              
Department  of  Environmental   Conservation  (DEC),  but  she did                                                              
not expect the participation to have a material impact.                                                                         
Vice-Chair   Ortiz   asked  if   the  DEC   currently   played  an                                                              
active  role   in  the  eradication   of  invasive   species.  Ms.                                                              
Achee  answered  in  the  affirmative.  She  elaborated  that  the                                                              
department's    involvement   included   approving   permits   for                                                              
pesticides   to help  eradicate   Elodea  and  a certain   species                                                              
of fish.  The  department  had  developed  a general  permit  that                                                              
would  speed  up  the  process  and  allowed  for  rapid  response                                                              
when  the situation  fell  within  defined  parameters  where  the                                                              
risk and other considerations would be well-known.                                                                              
2:59:31 PM                                                                                                                    
AT EASE                                                                                                                         
3:00:18 PM                                                                                                                    
Representative     Carpenter     asked    about    response    and                                                              
prevention  of  invasive  species.   He asked  if  the department                                                               
could   manage   invasive   species   in   the   current   budget.                                                              
Commissioner   Vincent-Lang   answered  that  the  department  was                                                              
looking  to convene  the  council  to develop  a  common  strategy                                                              
to determine   what may  be needed  to  address the  issue  and in                                                              
terms  of  regulatory   oversight.  Currently,   DFG  was  dealing                                                              
with  invasive  species   on  a case  by  case  basis.  He  wanted                                                              
the  development   of  a comprehensive   strategy   that  included                                                              
state  and   federal  agencies   to  help   tackle  the   problem.                                                              
Representative    Carpenter    inquired    if   the   legislature                                                               
directed   the  department   to  develop  its  own   strategy  for                                                              
dealing   with  invasive  species   whether  the  department   had                                                              
the   ability   to  create   a   strategy   without   a   council.                                                              
Commissioner   Vincent-Lang   replied   that  it  would  mean  the                                                              
need  to   convene  a   group  like  the   council   to  create  a                                                              
collaborative   approach  due  to  the necessary   involvement  of                                                              
various departments and federal agencies.                                                                                       
3:02:44 PM                                                                                                                    
Representative    Carpenter   asked  if   the  council   would  be                                                              
necessary  in  perpetuity  or  whether  the  need  was temporary.                                                               
Commissioner   Vincent-Lang  answered   that  he saw  the  council                                                              
working    for    a   couple    of    years    to   develop    the                                                              
recommendations   and  he viewed  that  it would  not  need  to be                                                              
permanent.  He  added  that the  council  would  publish  a report                                                              
that included recommendations.                                                                                                  
Representative   Tarr  provided  closing  remarks.  She  addressed                                                              
the  questions  by  Representative   Carpenter.  She  noted   that                                                              
the  previous  committee  had  discussed  the  need  for a  sunset                                                              
date.  She   anticipated   that  the   point  to  reevaluate   the                                                              
council's   ongoing  role  would  be  after  the  strategic   plan                                                              
was  published.   She  favored  the  status  of  the  bill  as  it                                                              
felt   premature   to  put  an   end  date   on  the  council   at                                                              
present.  She  was supportive  of  a sunset  but  did not  want to                                                              
act hastily.                                                                                                                    
3:05:09 PM                                                                                                                    
Representative   Carpenter  believed  that  something  was  needed                                                              
to  be  done  to  address  invasive   species;   however,  he  was                                                              
cautious    about   creating    another   bureaucracy.    He   was                                                              
hesitant  to  support  the  bill  without  a  sunset  or  backstop                                                              
to   creating   more   government.    He  wanted    to  offer   an                                                              
amendment of some sort.                                                                                                         
Co-Chair   Merrick  set  a  noon   deadline  for  amendments   the                                                              
following day.                                                                                                                  
HB   54  was   HEARD   and   HELD   in   committee   for   further                                                              
3:06:43 PM                                                                                                                    
The meeting was adjourned at 3:06 p.m.                                                                                          

Document Name Date/Time Subjects
HB 57 PCE legal opinion 4.8.21.pdf HFIN 5/18/2021 1:30:00 PM
HB 57
HB 57 presentation 3.9.21.pdf HFIN 5/18/2021 1:30:00 PM
HB 57
HB 57 Public Testimony by 051821.pdf HFIN 5/18/2021 1:30:00 PM
HB 57