Legislature(2021 - 2022)ADAMS 519

05/03/2022 01:30 PM House FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Delayed to 2:00 pm today --
Heard & Held
-- Public Testimony --
Moved HB 416 Out of Committee
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
Heard & Held
                   HOUSE FINANCE COMMITTEE                                                                                      
                         May 3, 2022                                                                                            
                          2:20 p.m.                                                                                             
2:20:28 PM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Merrick called the  House Finance Committee meeting                                                                    
to order at 2:20 p.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Representative Neal Foster, Co-Chair                                                                                            
Representative Kelly Merrick, Co-Chair                                                                                          
Representative Dan Ortiz, Vice-Chair                                                                                            
Representative Ben Carpenter                                                                                                    
Representative Bryce Edgmon                                                                                                     
Representative DeLena Johnson                                                                                                   
Representative Andy Josephson                                                                                                   
Representative Bart LeBon                                                                                                       
Representative Sara Rasmussen                                                                                                   
Representative Steve Thompson                                                                                                   
Representative Adam Wool                                                                                                        
MEMBERS ABSENT                                                                                                                
ALSO PRESENT                                                                                                                  
Bailey  Woolfsteed,  Self,   Juneau;  Kevin  Higgins,  Self,                                                                    
Juneau; Nancy  Meade, General Counsel, Alaska  Court System;                                                                    
Tom  Wright,  Staff,  Representative Steve  Thompson;  Elise                                                                    
Sorum-Birk,  Staff,  Representative  Andy  Josephson;  Kevin                                                                    
Higgins,  Self,  Juneau;  Michael Partlow,  Fiscal  Analyst,                                                                    
Legislative  Finance  Division; Neil  Steininger,  Director,                                                                    
Office of Management and Budget, Office of the Governor.                                                                        
PRESENT VIA TELECONFERENCE                                                                                                    
Samantha  Weinstein,  Self,  Juneau;  Skiff  Lobaugh,  Human                                                                    
Resource  Manager, Legislative  Affairs Agency;  Noah Klein,                                                                    
Legislative  Counsel,  Legislative  Legal  Services,  Alaska                                                                    
State  Legislature;  Megan  Wallace,  Director,  Legislative                                                                    
Legal  Services,  Alaska  State  Legislature;  Dom  Pannone,                                                                    
Administrative    Services     Director,    Department    of                                                                    
Transportation and  Public Facilities, Office  of Management                                                                    
and  Budget, Office  of the  Governor;  John Binder,  Deputy                                                                    
Commissioner,  Department   of  Transportation   and  Public                                                                    
Facilities; Andy  Mills, Legislative Liaison,  Department of                                                                    
Transportation  and Public  Facilities;  David Karp,  Senior                                                                    
Vice-President,  Managing   Director,  Saltchuk,  Anchorage;                                                                    
Sylvan  Robb, Assistant  Commissioner, Department  of Health                                                                    
and Social Services.                                                                                                            
HB 226    PAY INCREASES FOR STATE ATTORNEYS                                                                                     
          HB  226  was  HEARD  and  HELD  in  committee  for                                                                    
          further consideration.                                                                                                
HB 283    APPROP: CAP; REAPPROP; SUPP                                                                                           
          HB  283  was  HEARD  and  HELD  in  committee  for                                                                    
          further consideration.                                                                                                
HB 416    BONUSES FOR NONUNION PUBLIC EMPLOYEES                                                                                 
          HB 416 was REPORTED out  of committee with six "do                                                                    
          pass"   recommendations,   one   "do   not   pass"                                                                    
          recommendation,   and  four   "no  recommendation"                                                                    
          recommendations  and  with one  new  indeterminate                                                                    
          fiscal    note   from    the    Office   of    the                                                                    
Co-Chair Merrick reviewed the meeting agenda.                                                                                   
HOUSE BILL NO. 226                                                                                                            
     "An Act relating to the  compensation of certain public                                                                    
     officials,  officers,  and  employees  not  covered  by                                                                    
     collective   bargaining   agreements;  increasing   the                                                                    
     salaries of  certain attorneys  employed by  the state;                                                                    
     and providing for an effective date."                                                                                      
2:21:01 PM                                                                                                                    
Co-Chair Merrick  noted that there were  four amendments for                                                                    
REPRESENTATIVE  ANDY  JOSEPHSON, SPONSOR,  provided  opening                                                                    
comments on the legislation. He  shared that he had been the                                                                    
subcommittee chair for the Department  of Law (DOL) for four                                                                    
years. He was not looking  for another problem to solve. The                                                                    
department had repeatedly presented  on its retention crisis                                                                    
since his time on the subcommittee.                                                                                             
2:22:05 PM                                                                                                                    
Co-Chair Merrick OPENED public testimony.                                                                                       
BAILEY  WOOLFSTEED, SELF,  JUNEAU, spoke  in support  of the                                                                    
legislation. She  shared that  she was  a prosecutor  in the                                                                    
Office  of  Special  Prosecutions,  Rural  Prosecution  Unit                                                                    
working on  sexual assault and domestic  violence. She urged                                                                    
the committee to  pass the bill. She explained  why the bill                                                                    
did not go  far enough. She discussed  the rigorous workload                                                                    
prosecutors   were   experiencing.   She   elaborated   that                                                                    
prosecutors  were  working  60   to  80  hour  workweeks  in                                                                    
addition to being on call 24  hours a day, seven days a week                                                                    
to assist  officers in emergent  situations and  cover every                                                                    
court holiday.  She had worked  on Christmas the  past year.                                                                    
She noted that  the attorneys did not get  paid overtime and                                                                    
the   job  was   distressing.  She   shared  from   personal                                                                    
experience  viewing  child   pornography,  crime  scene  and                                                                    
autopsy photographs of a 10 year  old girl who was raped and                                                                    
murdered as  part of  her job duties.  She could  not forget                                                                    
such images.  She indicated  that she  travelled 78  days to                                                                    
Western Alaska  for work in  the prior  year and 38  days so                                                                    
far in  2022. She  relayed that  many colleagues  left state                                                                    
service  to work  for municipalities,  Washington State,  or                                                                    
for the  federal government where they  had lower caseloads,                                                                    
less  stress, were  paid  significantly   better wages.  and                                                                    
had   pensions.  She   shared  the   attorneys   frustration                                                                    
observing  many state  unions receiving  raises and  Cost of                                                                    
Living Adjustments  (COLA) while they were  left behind. The                                                                    
bill was not sufficient  to make the department competitive.                                                                    
She explained  that the crisis  was far reaching,  and state                                                                    
attorneys  were  key  players on  the  public  safety  team;                                                                    
without  them public  safety was  not adequately  addressed.                                                                    
She emphasized that police could  make an arrest and forward                                                                    
charges,  but prosecutors  argued  bail,  met with  victims,                                                                    
performed  case  work,  negotiated,  and  tried  cases.  She                                                                    
underscored that  attorneys were  leaving in  droves because                                                                    
the  legislature had  not provided  sufficient salaries  and                                                                    
benefits  and  did not  recognize  their  value while  other                                                                    
governments did.  She listed ways  the legislation  could go                                                                    
farther  to address  the issue.  She recommended  a 40  hour                                                                    
work week, on-call  pay, COLAs and step  increases that were                                                                    
on par  with other law  enforcement colleagues in  the state                                                                    
and nation.  She asked the legislature  to support attorneys                                                                    
working hard for the state.                                                                                                     
2:25:23 PM                                                                                                                    
KEVIN  HIGGINS, SELF,  JUNEAU, testified  in support  of the                                                                    
legislation.  He  shared  that   he  worked  for  the  Civil                                                                    
Division  with the  Department  of Law.  He  noted that  the                                                                    
discussion regarding  recruitment and retention  issues were                                                                    
consistent throughout state agencies.  He reasoned that when                                                                    
employees  were not  paid well  enough and  people left,  it                                                                    
increased the workload for those  remaining until they quit,                                                                    
which  made  recruitment   difficult.  Often  newly  trained                                                                    
employees left  once they  became more  marketable somewhere                                                                    
else. He  voiced that the  state could not  function without                                                                    
attorneys;  civil  attorneys advised  agencies,  implemented                                                                    
the administration's policy, and  defended the state against                                                                    
claims. He stressed that without  attorneys the state had to                                                                    
pay much  more for  the services in  the private  market. He                                                                    
voiced  that  paying  staff made  good  economic  sense  and                                                                    
without  a defined  benefit  plan, pay  was  the only  lever                                                                    
available.  He asked  for the  committees   support for  the                                                                    
2:27:07 PM                                                                                                                    
SAMANTHA  WEINSTEIN,  SELF,   JUNEAU  (via  teleconference),                                                                    
spoke in support  of the bill. She urged  the legislature to                                                                    
implement the bill  at the start of the  coming fiscal year.                                                                    
She shared that she was  a former assistant attorney general                                                                    
in the  civil division  and had left  the department  at the                                                                    
beginning of  April 2022 due  to burnout. She  had initially                                                                    
been  excited  to work  for  the  department. She  wanted  a                                                                    
steady  paycheck, benefits,  and  the  opportunity to  learn                                                                    
from  experienced staff  but the  excitement wore  off. Over                                                                    
the last 3  years she had seen two  attorney generals resign                                                                    
in  disgrace. She  experienced section  supervisors quitting                                                                    
or  retiring,   and  many  colleagues   quit  to   work  for                                                                    
municipalities, federal  government, or private  practice in                                                                    
the lower 48. She understood  that those jobs offered better                                                                    
pay,   benefits,   better   work-life  balance,   and   more                                                                    
opportunities for growth. She  felt that the other employers                                                                    
demonstrated that  they valued  their workers.  She stressed                                                                    
that  carrying  the workload  of  2  to  4 employees  was  a                                                                    
 burnout.  She  relayed that  she was  physically, mentally,                                                                    
and  emotionally exhausted  and  chronically stressed  while                                                                    
working  for the  state. She  underscored  that burnout  was                                                                    
running  rampant  within  the department  and  workers  were                                                                    
demoralized. She urged for passage of the bill.                                                                                 
Co-Chair Merrick CLOSED public testimony.                                                                                       
2:29:40 PM                                                                                                                    
Co-Chair Merrick moved to amendments.                                                                                           
Representative  Thompson MOVED  to  ADOPT  Amendment 1,  32-                                                                    
LS0960\G.5  (Klein, 4/27/22)  (copy on  file) [note:  due to                                                                    
the length of the amendment it  has not been included in the                                                                    
minutes. See copy on file for detail].                                                                                          
Representative Josephson OBJECTED for discussion.                                                                               
Representative Thompson  explained that he had  a conceptual                                                                    
amendment for  Amendment 1 recommended by  the Court System.                                                                    
He  explained the  conceptual amendment.  He stated  that on                                                                    
page 3, line 22 of the  bill it deleted the following words,                                                                    
 other than justices  and judges.  He deferred  to the Court                                                                    
System for further explanation.                                                                                                 
Co-Chair Merrick OBJECTED for discussion.                                                                                       
NANCY   MEADE,  GENERAL   COUNSEL,   ALASKA  COURT   SYSTEM,                                                                    
explained  conceptual  Amendment  1. She  relayed  that  she                                                                    
asked the sponsor  of Amendment 1 to remove  the phrase. She                                                                    
explained that the  amendment would provide a  5 percent pay                                                                    
increase  for all  non-covered employees.  Section 6  of the                                                                    
amendment   included   the   Judicial  Branch,   which   she                                                                    
supported.  However,  she did  not  think  it had  been  the                                                                    
sponsor's  intent   to  exclude  judges  and   justices  but                                                                    
excluding them  in uncodified  law created  a conflict  in 4                                                                    
statutory provisions within Title  22. She reported that for                                                                    
the  four levels  of judges  there were  explicit provisions                                                                    
that specified if  the monthly based salary in  the chart on                                                                    
page 1 of the amendment,  pertaining to Title 39,  increased                                                                    
the monthly  based salary of a  judge or a justice  it shall                                                                    
increase  by the  same percentage.   The language  created a                                                                    
conflict having  uncodified law stating that  even though it                                                                    
would raise the wages by  5 percent judges and justices were                                                                    
excluded. She believed that they  needed to be included. She                                                                    
furthered that  the provision  had been  added in  2006 with                                                                    
respect to  judges because unless  judges and  justices kept                                                                    
pace  with  all the  increases  that  all other  non-covered                                                                    
employees  received  the  Judicial  Branch ended  up  in  an                                                                    
uncomfortable position  in asking  for a  significant raise.                                                                    
Alaskan  judges were  consistently  ranked at  number 50  in                                                                    
terms of  judicial salaries across the  country. The statute                                                                    
was meant to ensure that judges were not excluded.                                                                              
2:32:51 PM                                                                                                                    
Co-Chair  Merrick  withdrew   her  objection  to  conceptual                                                                    
amendment 1.                                                                                                                    
There being NO OBJECTION, it was so ordered.                                                                                    
Representative  Thompson  explained  the  amendment  with  a                                                                    
prepared statement:                                                                                                             
     The amended  amendment represented a 5  percent cost of                                                                    
     living adjustment  (COLA) for exempt employees  for the                                                                    
     legislative  and executive  branches. Exempt  employees                                                                    
     had not received increases  or salary adjustments since                                                                    
     2016. In  the meantime, non-exempt employees  either in                                                                    
     the  general government  units  or  in the  Supervisory                                                                    
     Units  had  received  COLA increases  totaling  over  5                                                                    
     percent.  It  was  a matter  of  fairness  that  exempt                                                                    
     employees received  the same COLA increase  as those of                                                                    
     the  GGU and  SU bargaining  units. The  total cost  of                                                                    
     enacting  this   legislation  for  the   executive  and                                                                    
     legislative branches  was projected to be  $13. 211.900                                                                    
     million of  which $7. 520.100 million  was Undesignated                                                                    
     General Funds (UGF).                                                                                                       
TOM   WRIGHT,   STAFF,    REPRESENTATIVE   STEVE   THOMPSON,                                                                    
elaborated on the amendment. He  shared that since FY 16 the                                                                    
exempt  noncovered  employees  in  the  admiration  and  the                                                                    
legislature had  not received a  COLA. Since that  time, GGU                                                                    
had received approximately  23.5 percent in COLAs  and in FY                                                                    
20, FY  21, and FY  22 they  received a 5  percent increase.                                                                    
Recently, a new contract had  been approved that granted a 3                                                                    
percent increase in  2023, the following year  a 2.5 percent                                                                    
increase,  and possibly  in 2025  a 5  percent increase.  He                                                                    
noted that the 5 percent  increase was based on the Consumer                                                                    
Price  Index  (CPI) as  of  July  1,  2022, which  would  be                                                                    
automatic according to the  Legislative Finance Division. He                                                                    
added that in 2019 the  Supervisory Union (SU) received a 40                                                                    
hour work  week, which  equated to  a 6.25  percent increase                                                                    
and  in 2022  received a  3 percent  increase, 1  percent in                                                                    
2023, and 1 percent in 2024. He deduced that SU received                                                                        
approximately  16  percent  in increases.  He  cited  Bailey                                                                    
Woolfsteed,   the  earlier   testifier  that   reported  not                                                                    
receiving a COLA since 2016.  He stated that a COLA increase                                                                    
could  potentially help  alleviate some  of the  recruitment                                                                    
and retention problems.                                                                                                         
2:36:45 PM                                                                                                                    
Representative  Wool  referred to  SU  hours  reduced to  40                                                                    
hours per  week, which equated  to a 6 percent  increase. He                                                                    
asked what the hours had  been previously. He deemed that if                                                                    
hours were decreased to 40  per week without a pay increase,                                                                    
he did not understand how it was a pay increase.                                                                                
Co-Chair  Merrick recognized  Representative Matt  Claman in                                                                    
Mr. Wright  responded that the  SU unit increased  from 37.5                                                                    
hours per week  to 40 hours per week in  2019 and received a                                                                    
6.25 percent  increase for the additional  2.5 weekly hours.                                                                    
Representative   Wool    thanked   Mr.   Wright    for   the                                                                    
clarification. He  deuced that even  with the increase  to a                                                                    
40 hour work  week they still received  an overall increase.                                                                    
Mr.  Wright  referred  to Ms.  Woolsteed  who  testified  to                                                                    
working 60  hours per week so  decreasing to a 40  hour work                                                                    
week would mean increased pay.                                                                                                  
2:38:43 PM                                                                                                                    
Representative  Carpenter  asked  for context.  He  inquired                                                                    
about the range  and step of a newly  hired attorney through                                                                    
a collective bargaining unit and ones that were not.                                                                            
SKIFF LOBAUGH,  HUMAN RESOURCE MANAGER,  LEGISLATIVE AFFAIRS                                                                    
AGENCY  (via teleconference),  answered that  there were  no                                                                    
attorneys in the legislative branch  covered by a collective                                                                    
bargaining  unit. All  the attorneys  under the  Legislative                                                                    
Affairs Agency  (LAA) were paid through  the salary schedule                                                                    
adopted  under AS  39.27.011(a) and  generally started  at a                                                                    
range 23 to 25 depending on years of experience.                                                                                
Representative Carpenter asked for  a comparative figure for                                                                    
state employees under collective bargaining.                                                                                    
2:40:40 PM                                                                                                                    
Mr. Wright  answered that  none of the  attorneys in  DOL or                                                                    
the  Department  of   Administration  (DOA)  were  unionized                                                                    
Representative  Carpenter stated  that it  made finding  the                                                                    
answer much easier if there was no union involved.                                                                              
Representative   Josephson  requested   that  someone   from                                                                    
Legislative Legal Services called in for questions.                                                                             
Co-Chair Merrick complied.                                                                                                      
Representative Wool  asked if there were  attorneys in other                                                                    
departments that  were covered under  collective bargaining.                                                                    
Mr. Wright  did not  believe so but  deferred the  answer to                                                                    
Mr. Lobaugh  had the  same understanding  as Mr.  Wright. He                                                                    
answered  that  state  attorneys were  partially  exempt  or                                                                    
fully exempt  and covered under  the AS  39.27.011(a) salary                                                                    
schedule. He suggested that the  Division of Personnel under                                                                    
the Department  of Administration could answer  the question                                                                    
definitively. He  reiterated that all  legislative attorneys                                                                    
were  exempt including  several attorneys  in the  Office of                                                                    
Victims Rights.                                                                                                                 
2:43:07 PM                                                                                                                    
AT EASE                                                                                                                         
2:47:45 PM                                                                                                                    
Representative  Carpenter asked  for an  explanation of  the                                                                    
process for changing from a range  6 to a range 7 and moving                                                                    
up  the  step  scale.   Mr.  Lobaugh  answered  that  ranges                                                                    
represented the  class of work  an employee was  assigned to                                                                    
perform.  He   exemplified  Personnel  and   indicated  that                                                                    
Personnel Assistants  ranges were  14 through 16.  The range                                                                    
14 would work  with payroll and the  higher ranges performed                                                                    
payroll   supervision  and   investigation  and   the  range                                                                    
increased  as the  level of  complexity  and consequence  of                                                                    
error  increased.  He  added  that  it  was  the  same  with                                                                    
legislative  attorney job  classes  beginning with  drafting                                                                    
bills and  increasing to higher  range drafters up  to range                                                                    
25.  The  steps  were  considered  for  meritorious  service                                                                    
depending on the length of  time and per recommendation by a                                                                    
supervisor. Steps  were time in  the range grade,  and range                                                                    
was determined  by the  work and duties  as allotted  to the                                                                    
job  classification. Representative  Carpenter repeated  his                                                                    
understanding  of the  answer.  He asked  for  the time  and                                                                    
range  requirement before  moving up  a step  assuming there                                                                    
was a meritorious recommendation.  Mr. Lobaugh answered that                                                                    
steps A through F increased  each year and beyond that steps                                                                    
increased every two years.                                                                                                      
2:50:57 PM                                                                                                                    
Representative  Josephson   asked  if  Amendment   1  meshed                                                                    
seamlessly and  without interference  with version G  of the                                                                    
NOAH   KLEIN,   LEGISLATIVE   COUNSEL,   LEGISLATIVE   LEGAL                                                                    
SERVICES,  ALASKA  STATE LEGISLATURE  (via  teleconference),                                                                    
asked for clarification on the question.                                                                                        
Representative Josephson acknowledged  the amendment changed                                                                    
policy.  He asked  if the  amendment in  any way  deleted or                                                                    
altered  version  G of  the  bill.  Mr. Klein  replied  that                                                                    
Amendment 1  increased the salary  table; therefore,  the 10                                                                    
percent increase for attorneys  in the underlying bill would                                                                    
be 10 percent of the increase table.                                                                                            
Representative Josephson WITHDREW his OBJECTION.                                                                                
2:52:51 PM                                                                                                                    
AT EASE                                                                                                                         
2:53:59 PM                                                                                                                    
Co-Chair  Merrick noted  that  Representative Edgmon  joined                                                                    
the meeting.                                                                                                                    
There  being NO  further OBJECTION,  Amendment 1  as amended                                                                    
was adopted.                                                                                                                    
Representative  Thompson MOVED  to  ADOPT  Amendment 2,  32-                                                                    
LS0960\G.6 (Klein, 4/27/22) (copy on file):                                                                                     
     Page 1, line 1, following "Act":                                                                                           
     Insert "relating to the compensation of certain                                                                            
     employees of the legislative branch;"                                                                                      
     Page 2, line 1, following "AS 39.25.120(c)(3)":                                                                            
     Insert ", attorneys in the division of legal and                                                                           
     research services within the Legislative Affairs                                                                           
     Page 2, following line 3:                                                                                                  
     Insert a new bill section to read:                                                                                         
     "* Sec. 3. AS 24.10.220 is repealed."                                                                                      
     Renumber the following bill sections accordingly.                                                                          
     Page 2, line 11:                                                                                                           
     Delete "Section 3"                                                                                                         
     Insert "Section 4"                                                                                                         
     Page 2, line 12:                                                                                                           
     Delete "sec. 4"                                                                                                            
     Insert "sec. 5"                                                                                                            
Co-Chair Merrick OBJECTED for discussion.                                                                                       
2:54:36 PM                                                                                                                    
Representative  Thompson  asked  his staff  to  explain  the                                                                    
Mr.  Wright   explained  the  amendment.  He   relayed  that                                                                    
Representative Thompson  believed that  it would be  fair to                                                                    
raise the  pay of the  legislative attorneys along  with the                                                                    
other attorneys working for the state.                                                                                          
Co-Chair  Merrick voiced  that legislative  attorneys worked                                                                    
 diligently for the legislators.                                                                                                
Representative Josephson was grateful  for the amendment and                                                                    
believed that an increase was well earned.                                                                                      
Representative  Wool  asked  if  there  was  a  fiscal  note                                                                    
reflecting  the  amendments.  Mr. Wright  answered  that  it                                                                    
would be  up to the  committee to request an  updated fiscal                                                                    
note. Representative  Wool wanted  to know  the cost  of the                                                                    
salary  increases. Mr.  Wright  answered that  the cost  for                                                                    
Amendment  1 was  approximately  $13.211.9  million for  the                                                                    
executive branch  and $2.344.6  million for  the legislative                                                                    
branch.  He added  that $494.9  was included  in the  mental                                                                    
health bill.                                                                                                                    
2:57:18 PM                                                                                                                    
Representative Wool asked for the  amount in Amendment 2 for                                                                    
the legislative branch. Mr. Wright  answered that He did not                                                                    
have the amount for Amendment 2.                                                                                                
Co-Chair Merrick  asked Legislative  Legal Services  for the                                                                    
number of employees in Legislative Legal.                                                                                       
2:58:48 PM                                                                                                                    
MEGAN WALLACE, DIRECTOR,  LEGISLATIVE LEGAL SERVICES, ALASKA                                                                    
STATE LEGISLATURE (via  teleconference), answered there were                                                                    
14 attorneys employed for Legislative Legal Services.                                                                           
Co-Chair  Merrick  asked  whether that  included  legal  and                                                                    
research  services. Ms.  Wallace agreed.  She detailed  that                                                                    
there  were   no  attorneys  that  worked   for  Legislative                                                                    
Research, the  14 attorneys worked exclusively  in the legal                                                                    
Co-Chair Merrick WITHDREW her OBJECTION.                                                                                        
There being NO further OBJECTION, Amendment 2 was ADOPTED.                                                                      
2:59:40 PM                                                                                                                    
Vice-Chair Ortiz  MOVED to ADOPT Amendment  3, 32-LS0960\G.8                                                                    
(Klein, 5/2/22) (copy on file):                                                                                                 
     Page 2, following line 3:                                                                                                  
     Insert a new bill section to read:                                                                                         
     "* Sec.  3. The uncodified  law of the State  of Alaska                                                                    
     is amended by adding a new section to read:                                                                                
     SALARY INCREASES FOR CERTAIN  EMPLOYEES OF THE JUDICIAL                                                                    
     BRANCH.  The  salary  increase under  AS  39.27.011(l),                                                                    
     added by sec.  2 of this Act, applies  to permanent and                                                                    
     temporary  employees and  magistrates  in the  judicial                                                                    
     branch  of the  state government,  other than  justices                                                                    
     and  judges,  who  are  not  members  of  a  collective                                                                    
     bargaining  unit  established   under  AS  23.40.070  -                                                                    
     23.40.260  (Public Employment  Relations  Act) and  who                                                                    
     are not otherwise covered by AS 39.27.011(a)."                                                                             
     Renumber the following bill sections accordingly.                                                                          
     Page 2, line 11:                                                                                                           
     Delete "Section 3"                                                                                                         
     Insert "Section 4"                                                                                                         
     Page 2, line 12:                                                                                                           
     Delete "sec. 4"                                                                                                            
     Insert "sec. 5"                                                                                                            
Co-Chair Merrick OBJECTED for discussion.                                                                                       
Vice-Chair  Ortiz explained  the amendment.  He stated  that                                                                    
Amendment  3 added  Judicial Branch  employees to  the bill,                                                                    
and they would  receive the 10 percent  salary increase. The                                                                    
Judicial Branch  were among the lowest  paid state employees                                                                    
and the branch was  experiencing severe retention and hiring                                                                    
problems.  He noted  the importance  of sufficient  judicial                                                                    
staffing levels to avoid case  processing bottlenecks in the                                                                    
criminal justice  system. He related that  smaller courts in                                                                    
the state  were struggling  and had to  close its  doors for                                                                    
limited  time periods  and had  none or  little response  to                                                                    
recruitment  efforts.   They  were   losing  staff   to  the                                                                    
executive and legislative branches.  He relayed that half of                                                                    
the judicial staff  were paid range 12 or below;  a range 12                                                                    
A made  $43 thousand  per year. The  high cost  of inflation                                                                    
and soaring  rents were issues  for range 12 jobs.  He noted                                                                    
that Ms. Mead was available  to further explain the need for                                                                    
the amendment.                                                                                                                  
3:01:47 PM                                                                                                                    
Representative LeBon  noted there  had been an  action taken                                                                    
in  a prior  amendment  to strike  justices  and judges  and                                                                    
wondered whether it applied here  and the reason why if not.                                                                    
He  asked   for  further  detail.  Ms.   Mead  replied  that                                                                    
Amendment  3  excluded  justices  and  judges  from  the  10                                                                    
percent pay raise  to judicial branch employees.  It did not                                                                    
run afoul to the previous  mentioned statutes because it did                                                                    
not overall raise  the chart in Title 39.  However, now that                                                                    
an amendment had  passed that would increase  the amounts in                                                                    
Title  39, an  amendment would  need to  cover justices  and                                                                    
judges  as well.  Representative  LeBon asked  if the  words                                                                    
needed to be struck in  the amendment. Ms. Mead replied that                                                                    
the answer was yes.                                                                                                             
Representative LeBon  MOVED to ADOPT conceptual  Amendment 1                                                                    
to Amendment 3 to strike  the words  other than justices and                                                                    
There  being   NO  OBJECTION,  conceptual  Amendment   1  to                                                                    
Amendment 3 was ADOPTED.                                                                                                        
3:04:02 PM                                                                                                                    
Ms. Mead appreciated the amendment.  She hoped the committee                                                                    
would  consider  Amendment  3 favorably.  She  informed  the                                                                    
committee  that  the  judicial  branch  employees  were  not                                                                    
unionized. The  executive branch had union  coverage for its                                                                    
lower paid  employees. She reiterated that  half of judicial                                                                    
employees were at range 12 and  below and 58 percent were at                                                                    
range 14 and  below. She delineated that  375 employees were                                                                    
at a range 12 equating  to $22.00 per hour, totaling $43,000                                                                    
per year. She noted  that fast food establishments increased                                                                    
wages to $15 to $18 per  hour. The Judicial branch wanted to                                                                    
retain employees and it was losing  range 12s and 14s to the                                                                    
private  sector  and  other   branches  of  government.  She                                                                    
furthered  that  if  the bill  passed  and  other  branches'                                                                    
employees received  a pay  raise it  would be  terrific, but                                                                    
unless  the Court  System  was included  the  effect on  the                                                                    
public would  be stunted. She  emphasized that  the criminal                                                                    
and civil justice  system was indeed a  system. She restated                                                                    
that  the Judicial  Branch was  struggling with  recruitment                                                                    
and  retention  and   so  were  many  of   its  lower  range                                                                    
employees. She indicated  that a range 12  wage was eligible                                                                    
for  Supplemental Nutrition  Assistance  Program (SNAP)  and                                                                    
the take  home salary minus all  deductions and withholdings                                                                    
was roughly  $2,200 per  month. She  stated that  the branch                                                                    
was   simply  not paying  a  livable  wage,  which  was  the                                                                    
reason  the system  had to  close some  offices for  several                                                                    
days in  a row. She  maintained that the Court  System would                                                                    
truly benefit  from the  10 percent pay  raise and  so would                                                                    
the range 12 employees.                                                                                                         
3:07:28 PM                                                                                                                    
Representative   Wool  stated   his  understanding   of  the                                                                    
amendment increasing  wages at  designated ranges.  He asked                                                                    
why the system  could not merely start a person  at a higher                                                                    
range.  Ms.  Mead replied  that  the  Judicial Branch  could                                                                    
possibly  do that  with a  lot  more money  in its  personal                                                                    
services  budget. However,  it  attempted  to retain  parity                                                                    
with  executive  branch  classifications;  a  range  12  had                                                                    
certain  levels  of  responsibility  and if  the  range  was                                                                    
increased all  the higher  ranges had  to be  increased. She                                                                    
did  not know  that  it would  accomplish something  without                                                                    
funding allocated by the legislature.                                                                                           
Representative Carpenter asked why  higher ranges would have                                                                    
to  be  moved  up  if  the range  12s  moved  up.  Ms.  Mead                                                                    
explained that  if range 12 moved  up to a 14,  then a range                                                                    
13 that possessed  more job skills would  deservedly move to                                                                    
a range 15,  etc. but the court system would  still need the                                                                    
funding to pay for the increases.                                                                                               
3:10:04 PM                                                                                                                    
Representative Carpenter  asked where the top  end employees                                                                    
of  the Court  System fell  on  the range  system. Ms.  Mead                                                                    
answered that  the judges and  justices had a  different pay                                                                    
scale, which  she excluded in  her answer. She  relayed that                                                                    
some   magistrates  and   high   level   employees  in   the                                                                    
administrative office  totaling 3  staffers were maybe  at a                                                                    
range 27,  attorneys were  paid at range  20 through  24 and                                                                    
they totaled 8. She offered  that it depended on experience.                                                                    
Representative Carpenter  asked how justices and  judges pay                                                                    
was determined.  Ms. Mead answered that  judges and justices                                                                    
were  paid   under  a  separate   statute  except   for  the                                                                    
provisions  that if  everyone else  received a  pay increase                                                                    
the justices should  as well. The current salary  for the 45                                                                    
superior  court judges  was about  $190,000; broken  down it                                                                    
ranged from  $161,000 for district  court and the  5 supreme                                                                    
court   judges   made   roughly   $206,000.   Representative                                                                    
Carpenter  asked which  statutes governed  judges' salaries.                                                                    
Ms. Mead  replied AS 22.07.090, AS  22.15.220, AS 22.05.140,                                                                    
and AS 22.05.140. The last  time the statutes changed was in                                                                    
2006 when justices and judges had  been at the bottom of the                                                                    
pay  scale nationally.  She reported  on  the difficulty  of                                                                    
obtaining significant increases,  therefore the statute that                                                                    
kept them in pace with other increases was put in place.                                                                        
3:13:19 PM                                                                                                                    
Co-Chair Merrick WITHDREW her OBJECTION.                                                                                        
There being  NO further  OBJECTION, Amendment 3  was ADOPTED                                                                    
as  amended. [Note:  Action on  Amendment 3  as amended  was                                                                    
later  rescinded  at  the  5/6/22  9:00  a.m.  meeting.  The                                                                    
original version  of Amendment  3 without  any modifications                                                                    
was  adopted  on  5/6/22  at  the  9:00  a.m.  meeting.  See                                                                    
separate minutes for detail.]                                                                                                   
3:13:37 PM                                                                                                                    
AT EASE                                                                                                                         
3:20:14 PM                                                                                                                    
Representative  Josephson MOVED  to ADOPT  Amendment 4,  32-                                                                    
LS0960\G.7 (Klein, 5/2/22) (copy on file):                                                                                      
     Page 1, line 14:                                                                                                           
     Delete "10"                                                                                                                
     Insert "25"                                                                                                                
Representative LeBon OBJECTED for discussion.                                                                                   
Representative Josephson  explained the amendment.  He MOVED                                                                    
to AMEND Amendment 4  conceptually. The conceptual amendment                                                                    
1 to  Amendment 4  would remove  amendment 3  therefore, the                                                                    
Judicial   employees  would   not  receive   the  additional                                                                    
increase in wages requested in Amendment 4.                                                                                     
Representative  Carpenter asked  for  a  restatement of  the                                                                    
conceptual amendment.                                                                                                           
Representative Josephson explained  that Amendment 4 applied                                                                    
to  the  bill  as  written and  was  currently  modified  to                                                                    
everyone who  worked in a courthouse.  Therefore, conceptual                                                                    
amendment 1 excluded amendment 3.                                                                                               
Representative Thompson requested further clarification.                                                                        
Representative Josephson  stated that  the court  system was                                                                    
satisfied with  the pay increase  in Amendment  3, therefore                                                                    
the  conceptual  amendment  would strike  Amendment  3  from                                                                    
Amendment 4.                                                                                                                    
3:22:17 PM                                                                                                                    
AT EASE                                                                                                                         
3:23:47 PM                                                                                                                    
ELISE  SORUM-BIRK,  STAFF,  REPRESENTATIVE  ANDY  JOSEPHSON,                                                                    
explained  how  the  adoptions of  the  previous  amendments                                                                    
changed the bill. She offered  that Amendment 1 included a 5                                                                    
percent  pay increase  for all  exempt and  partially exempt                                                                    
3:25:15 PM                                                                                                                    
AT EASE                                                                                                                         
3:25:40 PM                                                                                                                    
Ms. Sorum-Birk  pointed to page 1,  line 14 of version  G of                                                                    
the legislation  and read  the words,   are increased  by 10                                                                    
percent.   The  conceptual  amendment would  change  the  10                                                                    
percent  to  25  percent.  She detailed  that  the  original                                                                    
intent  of   the  amendment  would   apply  only   to  state                                                                    
attorneys. In  Amendment 3,  the increase  was passed  on to                                                                    
the  Judicial  branch employees.  Therefore,  Representative                                                                    
Josephsons   proposal  was  to   have  the  Judicial  branch                                                                    
receive  an additional  10 percent  increase  as adopted  in                                                                    
amendment 3  and the state  attorneys and  legislative legal                                                                    
attorneys (as  added by Representative  Thompsons  Amendment                                                                    
2) would  receive an increase  of 25 percent  [excluding the                                                                    
Representative  Carpenter  interjected that  the  conceptual                                                                    
amendment excluded the Judiciary branch.                                                                                        
Co-Chair   Merrick  asked   for   the  specific   conceptual                                                                    
amendment language.                                                                                                             
Representative  Josephson provided  the specific  conceptual                                                                    
amendment  language. He  stated  that  on a  new  line 4  of                                                                    
Amendment 4 insert  the language, "the increase  on line 14,                                                                    
page 1"  from 10 to 25  percent was not operative  for Court                                                                    
System employees, justices, and judges."                                                                                        
3:28:05 PM                                                                                                                    
Co-Chair Merrick WITHDREW her OBJECTION.                                                                                        
There being NO further  OBJECTION, conceptual Amendment 1 to                                                                    
Amendment 4 was ADOPTED.                                                                                                        
Representative  Josephson  spoke  to   the  reason  for  the                                                                    
amendment. He  characterized the  increase as  ambitious but                                                                    
felt it was  justified. He reminded that  committee that the                                                                    
state  attorneys  were  desperately  needed  in  the  public                                                                    
sector  on  behalf   of  the  public  and   heard  that  the                                                                    
department contracted out  for legal services at  up to $600                                                                    
per  hour.  He  stated   that  contracting  would  still  be                                                                    
necessary  for things  like oil  and  gas matters.  However,                                                                    
when the state nurtured the legal  talent in the oil and gas                                                                    
section,  they resigned  due  to low  wages.  He relayed  an                                                                    
earlier meeting with  the Attorney General of  the state and                                                                    
his  team informed  him  that  municipal attorneys  starting                                                                    
salary was  $87 thousand   and the executive  branch started                                                                    
its  attorneys  at  $60 thousand.  Therefore,  the  starting                                                                    
salary  increase  in  HB  226  increased  the  wage  to  $69                                                                    
thousand  and  although  generous it  was  insufficient  for                                                                    
retention. The  starting salary in Washington  state was $69                                                                    
thousand  including geolocation  differential pay.  He asked                                                                    
the  committee  to  recognized that  attorneys  were  highly                                                                    
skilled and  educated, often had education  debt, and passed                                                                    
the  toughest bar  in  the country.  He  believed that  they                                                                    
deserved to be paid accordingly.                                                                                                
3:31:34 PM                                                                                                                    
Representative Rasmussen  asked for  an explanation  why the                                                                    
original  bill  did  not  start  at 25  percent  if  it  was                                                                    
important to  achieve that type of  increase. Representative                                                                    
Josephson  answered  that   sometimes  decisions  were  made                                                                    
quickly  when  drafting  a  bill.  He  had  not  known  that                                                                    
municipal  attorneys started  at $87,000.  He had  not heard                                                                    
the  compelling  testimony  from   attorneys  nor  from  DOL                                                                    
regarding  the  incredible  turnover  among  its  ranks.  He                                                                    
faulted himself  for not  including a  higher number  in the                                                                    
bill.  Representative Rasmussen  was  very comfortable  with                                                                    
the original bill at the  10 percent. She was uncertain that                                                                    
the additional  15 percent  would increase  job satisfaction                                                                    
enough to retain employees. She  spoke to other  meaningful                                                                     
benefits  that could  boost  morale  including student  loan                                                                    
repayment,  childcare, etc.  She  thought  there were  other                                                                    
factors that needed consideration  besides pay. She reasoned                                                                    
that   improving   benefits   would   help.   She   remained                                                                    
unconvinced it was only about pay.                                                                                              
3:33:53 PM                                                                                                                    
Vice-Chair Ortiz  asked how the  amendment would  impact the                                                                    
existing fiscal note. He asked  for the cost. Representative                                                                    
Josephson responded that the fiscal  note for just attorneys                                                                    
was  in the  range of  $8  million. He  noted that  Workers                                                                     
Compensation attorneys were classified employees.                                                                               
3:34:56 PM                                                                                                                    
AT EASE                                                                                                                         
3:35:46 PM                                                                                                                    
Representative Josephson deduced that  the fiscal note would                                                                    
grow from $8 million to $20 million.                                                                                            
Representative  Thompson  wondered  if the  amendment  would                                                                    
have a waterfall effect on the Court System.                                                                                    
Ms.  Mead   replied  it  was  her   understanding  that  the                                                                    
amendment  would  exclude the  court  system  and was  a  25                                                                    
percent pay  increase for  attorneys. The  Judicial salaries                                                                    
would increase by  10 percent under Amendment 3  but not the                                                                    
additional 15 percent as proposed in Amendment 4.                                                                               
Representative  Wool  understood   the  amendment  sponsors                                                                     
reasoning.  He  ascertained  that  5 percent  was  added  by                                                                    
Amendment 1 and currently  the other amendments increased it                                                                    
by 15  percent and the last  amendment would bring it  up to                                                                    
30 percent overall. He took  issue with the proposal because                                                                    
other  state   employees  would  appreciate   a  significant                                                                    
increase and  there had been  many years with  no increases.                                                                    
He noted  single digit increases  for other  state employees                                                                    
and  highlighted that  the university  had  gone many  years                                                                    
without  raises for  anyone. He  clarified that  he was  not                                                                    
questioning that the attorneys did  not deserve more. He was                                                                    
not convinced that attorneys would  quit unless the increase                                                                    
was 30  percent. It  gave him  caution to  give one  group a                                                                    
significant raise when others deserved  it as well. He heard                                                                    
that  Department  of  Transportation and  Public  Facilities                                                                    
(DOT) equipment  operators were paid  less than  the private                                                                    
sector  and the  state  ranks were  decreasing. He  remarked                                                                    
that  teachers   were  also  struggling.  He   restated  his                                                                    
reticence towards the amendment.                                                                                                
3:39:32 PM                                                                                                                    
Representative LeBon  MAINTAINED his OBJECTION  to Amendment                                                                    
4 as amended.                                                                                                                   
A roll call vote was taken on the motion.                                                                                       
IN FAVOR: Josephson, Edgmon, Foster                                                                                             
OPPOSED:   LeBon,   Ortiz,    Rasmussen,   Thompson,   Wool,                                                                    
Carpenter, Johnson, Merrick                                                                                                     
The MOTION to adopt Amendment 4 as amended FAILED (3/8).                                                                        
Representative   Josephson   MOVED   to   ADOPT   Conceptual                                                                    
Amendment 2 to Amendment 4  deleting  15  and inserting  25                                                                     
on  line 4  resulting  in an  approximately  20 percent  pay                                                                    
Co-Chair Merrick OBJECTED for discussion.                                                                                       
3:42:05 PM                                                                                                                    
AT EASE                                                                                                                         
3:42:32 PM                                                                                                                    
Co-Chair  Merrick  asked  for  Representative  Josephson  to                                                                    
restate the amendment.                                                                                                          
Representative    Josephson   clarified    that   Conceptual                                                                    
Amendment  5   pertained  to   page  1,   line  14   of  the                                                                    
legislation. The conceptual amendment  would increase the 10                                                                    
percent  increase in  the bill  to 15  percent, which  would                                                                    
result in  a net  20 percent increase  in pay  for attorneys                                                                    
and administrative  law judges. He clarified  that the Court                                                                    
system would not  be included in the increase from  10 to 15                                                                    
Co-Chair Merrick MAINTAINED her OBJECTION.                                                                                      
A roll call vote was taken on the motion.                                                                                       
IN FAVOR: Ortiz,    Thompson,    Wool,   Edgmon,    Johnson,                                                                    
Josephson, Foster                                                                                                               
OPPOSED: LeBon, Rasmussen, Carpenter, Johnson, Merrick                                                                          
The MOTION  PASSED (6/5). There being  NO further OBJECTION,                                                                    
conceptual Amendment 5 was ADOPTED.                                                                                             
Co-Chair  Merrick would  hold the  bill  for updated  fiscal                                                                    
HB  226  was  HEARD  and   HELD  in  committee  for  further                                                                    
HOUSE BILL NO. 416                                                                                                            
     "An  Act  relating  to   the  compensation  of  certain                                                                    
     executive  branch employees  not covered  by collective                                                                    
     bargaining agreements;  and providing for  an effective                                                                    
3:44:27 PM                                                                                                                    
Co-Chair Merrick relayed that  the bill was previously heard                                                                    
on  April  29,   2022.  Amendments  for  HB   416  were  due                                                                    
yesterday, and none were received.                                                                                              
Co-Chair Merrick OPENED public testimony.                                                                                       
KEVIN  HIGGINS,   SELF,  JUNEAU,  supported  the   bill.  He                                                                    
believed  that retention  bonuses  were a   great idea.   He                                                                    
noted  retention bonuses  were included  in HB  281 and  the                                                                    
operating  budget   bill  provided  bonuses  for   some  DOL                                                                    
attorneys. He indicated that the  Civil Division was at risk                                                                    
of  losing  valuable  support   staff  like  paralegals  and                                                                    
associated  attorneys who  were  not covered  under GGU.  He                                                                    
voiced that the structure  would collapse without additional                                                                    
support.  He felt  that the  bonuses granted  in HB  281 for                                                                    
attorneys  could  be  reappropriated to  DOL  support  staff                                                                    
considering  the increase  awarded  in HB  226. He  stressed                                                                    
that  the   support  staff  needed  the   increase  and  the                                                                    
department needed to retain them.                                                                                               
3:46:07 PM                                                                                                                    
Co-Chair Merrick CLOSED public testimony.                                                                                       
Co-Chair  Foster MOVED  to REPORT  HB 416  out of  committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
There being NO OBJECTION, it was so ordered.                                                                                    
HB  416 was  REPORTED out  of committee  with six  "do pass"                                                                    
recommendations, one "do not  pass" recommendation, and four                                                                    
"no  recommendation"   recommendations  and  with   one  new                                                                    
indeterminate   fiscal  note   from   the   Office  of   the                                                                    
3:46:38 PM                                                                                                                    
AT EASE                                                                                                                         
3:54:49 PM                                                                                                                    
HOUSE BILL NO. 283                                                                                                            
     "An  Act   making  appropriations,   including  capital                                                                    
     appropriations,     reappropriations,     and     other                                                                    
     appropriations;  making   supplemental  appropriations;                                                                    
     and providing for an effective date."                                                                                      
3:54:52 PM                                                                                                                    
Co-Chair Merrick relayed that the  bill was heard during the                                                                    
morning meeting [050322 9:03 A.M.].                                                                                             
Representative  Rasmussen   referenced  page  9,   lines  25                                                                    
through  line 26,  that appropriated  $30 million  for state                                                                    
funded  road and  bridge completion  for  House districts  1                                                                    
through  40  and  wondered  whether  there  was  a  list  of                                                                    
DOM  PANNONE, ADMINISTRATIVE  SERVICES DIRECTOR,  DEPARTMENT                                                                    
OF   TRANSPORTATION  AND   PUBLIC   FACILITIES,  OFFICE   OF                                                                    
MANAGEMENT  AND   BUDGET,  OFFICE   OF  THE   GOVERNOR  (via                                                                    
teleconference),  replied  that  the  funding  was  for  any                                                                    
existing state  projects that needed additional  funding for                                                                    
completion  and  would  be  determined  by  the  department.                                                                    
Representative Rasmussen  wanted to  know where  the funding                                                                    
would be  spent. Mr. Pannone  responded that  the department                                                                    
could provide a list of  targeted projects to the committee,                                                                    
but currently there were not  any intended or named projects                                                                    
associated with the funding.                                                                                                    
JOHN    BINDER,   DEPUTY    COMMISSIONER,   DEPARTMENT    OF                                                                    
TRANSPORTATION AND  PUBLIC FACILITIES  (via teleconference),                                                                    
did not have  any additional information to  offer. He would                                                                    
provide  a  potential  list of  projects,  but  nothing  was                                                                    
currently designated.                                                                                                           
Representative Rasmussen  asked if the  department requested                                                                    
the funds. She wondered how  the funding came to be included                                                                    
in the budget. Mr. Binder deferred to Mr. Pannone.                                                                              
Mr.  Pannone answered  that  he  did not  believe  it was  a                                                                    
governor's requested item. He believed  it had been added by                                                                    
the legislature.                                                                                                                
3:59:30 PM                                                                                                                    
AT EASE                                                                                                                         
4:08:26 PM                                                                                                                    
Representative   Rasmussen   referenced  the   $30   million                                                                    
addition for  road and bridge  completion that was  added by                                                                    
the  legislature. She  wondered  how and  when  it had  been                                                                    
MICHAEL   PARTLOW,  FISCAL   ANALYST,  LEGISLATIVE   FINANCE                                                                    
DIVISION,  replied that  it had  been added  by the  Senate.                                                                    
Representative  Rasmussen  asked  for the  total  number  of                                                                    
funding  added to  the  capital budget  by  the Senate.  Mr.                                                                    
Partlow would follow up with the information.                                                                                   
4:09:54 PM                                                                                                                    
Representative  Wool   noted  that  there  had   been  prior                                                                    
discussion about  the Port of  Alaska located  in Anchorage.                                                                    
He asked  if there was  any state relationship to  the port.                                                                    
Mr. Pannone deferred to a colleague.                                                                                            
ANDY    MILLS,    LEGISLATIVE   LIAISON,    DEPARTMENT    OF                                                                    
TRANSPORTATION AND  PUBLIC FACILITIES  (via teleconference),                                                                    
answered  that  as  part  of  the  department's  long  range                                                                    
freight  plan the  Department of  Transportation and  Public                                                                    
Facilities  (DOT)   was  developing  a   holistic  statewide                                                                    
approach to  freight and cargo  and had a  department member                                                                    
on  the  team of  coordinators  for  the Port  of  Anchorage                                                                    
involved in the  planning effort. He indicated  that DOT had                                                                    
no  specific planning  or directional  efforts for  the port                                                                    
since it was a municipal port.                                                                                                  
4:12:30 PM                                                                                                                    
Representative Wool stated his  understanding of the answer.                                                                    
He  was  interested  to hear  more  about  the  departments                                                                     
holistic  freight  plan.  He   determined  that  Alaska  had                                                                    
freight  entering  the state  by  many  different means  and                                                                    
entry points and DOT likely had  the data on all the freight                                                                    
entering the  state. He recalled  testimony stating  that 50                                                                    
percent of  all freight came  through the port  in Anchorage                                                                    
and was  distributed to  90 percent  of its  communities. He                                                                    
wondered how DOTs  developing long  range freight plan would                                                                    
mesh  with  the  Port  of   Anchorages   plan  and  how  the                                                                    
department  would  solve any  problems  with  the port.  Mr.                                                                    
Mills replied  that the department  would provide  the prior                                                                    
copy of the  freight plan and some of the  efforts taken. He                                                                    
explained  that the  freight plan  was a  document like  the                                                                    
long  range transportation  plan that  accounted for  future                                                                    
capacity  needs.  The   department  anticipated  the  future                                                                    
capacity needs  of multimodal and  intermodal transportation                                                                    
systems  statewide.  The  department  collected  information                                                                    
from  stakeholders  but  beyond  that  it  currently  lacked                                                                    
specific data regarding the port  but had an estimate of the                                                                    
future potential  of the  port. The  information gave  DOT a                                                                    
picture of what infrastructure  was necessary to accommodate                                                                    
the  port.  Representative Wool  assumed  that  most of  the                                                                    
freight entered Alaska by ship.  He asked what percentage of                                                                    
the state's  freight came  via ship.  He assumed  the number                                                                    
was significant.  Mr. Mills recalled  that it was  around 80                                                                    
percent, but he did not  know for certain. He understood the                                                                    
Ted  Stevens International  Airport  received a  substantial                                                                    
amount of  cargo, but  he lacked the  data in  comparison to                                                                    
the port.                                                                                                                       
4:16:48 PM                                                                                                                    
Representative  LeBon referenced  the Alaska  Marine Highway                                                                    
System  (AMHS)  funding  including $30  million  in  federal                                                                    
funds. He asked for verification  that the federal money had                                                                    
been secured by the state's congressional delegation.                                                                           
Mr. Partlow answered  in the affirmative. He  added that the                                                                    
funding  was  part  of  the $200  million  for  rural  ferry                                                                    
service  as part  of the  federal Infrastructure  Investment                                                                    
and Jobs Act (IIJA). Representative  LeBon looked at the $20                                                                    
million for  AMHS and asked if  it had been included  in the                                                                    
governor's  original  budget.  Mr. Partlow  replied  in  the                                                                    
affirmative. He  detailed the funding  was a  typical yearly                                                                    
expense for  maintenance and repair  of vessels  whereas the                                                                    
$30 million  was specifically for  the design of  a mainline                                                                    
Representative Carpenter  cited section  14, page 57  of the                                                                    
bill  and read,   the expended  and unobligated  balances of                                                                    
the  following  appropriations  are  reappropriated  to  the                                                                    
Department of Health  reappropriated  from the Department of                                                                    
Health  and  Social  Services.   He  pointed  to  the  first                                                                    
reappropriation  from  the  2007  budget for  DHSS  for  the                                                                    
Medicaid Management Information  System (MMIS) completion in                                                                    
the amount  of roughly $12  million for MMIS  completion. He                                                                    
asked for  the status of  the MMIS completion from  2007 and                                                                    
questioned  why  there was  still  remaining  funding to  be                                                                    
reappropriated after 15 years.                                                                                                  
4:20:08 PM                                                                                                                    
Mr.  Partlow  agreed   that  it  was  a   very  old  capital                                                                    
appropriation. He informed  Representative Carpenter that as                                                                    
long as there was activity  on an old appropriation it could                                                                    
go on  in perpetuity.  The money  would lapse  after several                                                                    
years without any expenditure or  continuance of work on the                                                                    
project.  The lapsed  funding would  be  considered for  the                                                                    
legislature  to reappropriate  it for  a different  purpose.                                                                    
Typically, funding  for capital projects lasted  for 5 years                                                                    
but  it  could  last  longer if  it  had  ongoing  activity.                                                                    
Representative Carpenter asked for  a definition of  ongoing                                                                    
activity   as it  pertained to  the MMIS.  In 2007  they had                                                                    
used  the  word   completion.   He asked  what  a  continued                                                                    
effort to complete the system  may be. Mr. Partlow suggested                                                                    
that  the department  could speak  more precisely  about the                                                                    
activity. He was  aware that it was an  ongoing project, and                                                                    
they  were  not   at  completion.  Representative  Carpenter                                                                    
turned to line  2 of the reappropriation  for the Department                                                                    
of Health  in the  amount of $24  million for  the Statewide                                                                    
Electronic     Health     Information    Exchange     System                                                                    
reappropriated   to   the    Statewide   Electronic   Health                                                                    
Information Exchange  System. He  inquired whether it  was a                                                                    
similar situation  where there  was ongoing activity  for 13                                                                    
4:22:34 PM                                                                                                                    
Mr.  Partlow  answered  in   the  affirmative.  He  received                                                                    
information that  the two projects had  a significant amount                                                                    
of federal  funding authority, so  it was not  state funding                                                                    
sitting in a  bank account; it represented  the authority to                                                                    
expend  federal  funding  for the  projects.  Representative                                                                    
Carpenter stated  that it would  be helpful to  know whether                                                                    
the DHSS  funding was  federal or  state. Mr.  Partlow would                                                                    
follow up.  Representative Carpenter pointed out  that there                                                                    
were  many reappropriations  he had  questions on  that were                                                                    
over 10 years old in the millions of dollars.                                                                                   
4:23:36 PM                                                                                                                    
Co-Chair   Foster  referenced   the   earlier  question   by                                                                    
Representative Rasmussen regarding  the  governors  original                                                                    
requested amount and  how much the Senate  added. He pointed                                                                    
to  a document  titled  Capital Budget     Agency Summary                                                                       
House  Structure,  dated  April  28, 2022,  (copy on  file),                                                                    
which was  prior to  the adoption  of the  current Committee                                                                    
Substitute (CS).  He relayed that  the governor had  a total                                                                    
of nearly  $311 million in Unrestricted  General (UGF). When                                                                    
the  committee adopted  the Senate  version  the UGF  amount                                                                    
increased to  approximately  $707 million.  He surmised that                                                                    
the governor  requested $311 million,  and the  Senate added                                                                    
roughly $400 million.                                                                                                           
Representative Rasmussen hoped someone  was online to answer                                                                    
Representative  Wools   prior  question regarding  how  much                                                                    
freight entered the Port of Alaska.                                                                                             
DAVID  KARP,   SENIOR  VICE-PRESIDENT,   MANAGING  DIRECTOR,                                                                    
SALTCHUK, ANCHORAGE  (via teleconference), answered  that he                                                                    
did not  know the specific  amount of the volume  of freight                                                                    
that  entered  the  Port  of Alaska.  He  thought  that  the                                                                    
broader question was what the  alternatives to the port were                                                                    
for  bringing   significant  volumes  into  the   state.  He                                                                    
remarked  that  the other  ports  on  the road  system  were                                                                    
viable,  but  it was  necessary  to  consider the  types  of                                                                    
infrastructure  required to  accommodate different  types of                                                                    
vessels.  He viewed  viability  from  a business  continuity                                                                    
perspective  and believed  that Seward  was the  most viable                                                                    
port. However,  proximity to market was  a key consideration                                                                    
when considering  the impacts on surface  transportation. He                                                                    
noted  that Saltchuks   ships unloaded  over 400  containers                                                                    
twice a week,  but the company called the  Port of Anchorage                                                                    
Representative Rasmussen asked if the  volume at the Port of                                                                    
Seward increased  whether it would cost  consumers more when                                                                    
transporting  the   goods  to  the  Interior   via  road  or                                                                    
railroad.  Mr.  Karp  responded  that  it  was  a  difficult                                                                    
question  to   answer  due  to   the  number   of  variables                                                                    
associated  with  the   transportation  infrastructure  from                                                                    
Seward to the  Interior. He deemed that it  was a reasonable                                                                    
conclusion  to   draw  that  being  closer   to  the  market                                                                    
increased efficiency.                                                                                                           
4:28:34 PM                                                                                                                    
Representative Rasmussen asked if Mr.  Karp was aware of any                                                                    
road access to the interior  from Seward if something caused                                                                    
the Seward  Highway to  shut down. Mr.  Karp replied  in the                                                                    
negative. He  pointed out that  one of the things  that made                                                                    
Seward  unique was  that it  offered both  rail and  highway                                                                    
Vice-Chair Ortiz asked whether  Whittier was a viable option                                                                    
to become a major port for  the state. Mr. Karp related that                                                                    
after  the  2018  earthquake Saltchuck  thoroughly  analyzed                                                                    
relocating   short-term   and   long-term   operations   and                                                                    
discovered  that  the  Port  of  Seward  was  the  preferred                                                                    
alternative.  He elucidated  that  considering water  depth,                                                                    
docking capacity,  and shore side infrastructure  Seward was                                                                    
the   best  alternative.   He noted  that  from  a  business                                                                    
perspective the  Port of Alaska  in Anchorage made  the most                                                                    
sense due to its proximity to market.                                                                                           
4:31:18 PM                                                                                                                    
Representative  Carpenter   restated  his   prior  questions                                                                    
regarding reappropriations. He asked why  a 13 year old item                                                                    
was still  being carried forward  for what was  originally a                                                                    
system completion project.                                                                                                      
NEIL STEININGER, DIRECTOR, OFFICE  OF MANAGEMENT AND BUDGET,                                                                    
OFFICE  OF THE  GOVERNOR, answered  that the  appropriations                                                                    
were still ongoing and needed to  be sorted into the two new                                                                    
DHSS departments.  He delineated that  the MMIS had  been an                                                                    
ongoing  IT  project  for  quite   some  time  with  several                                                                    
appropriations over the years. He  reported that much of the                                                                    
funding was  federal in addition  to the state  General Fund                                                                    
(GF)  listed in  the bill.  As the  projects progressed  and                                                                    
changes  were  made  the projects  remained  active  in  the                                                                    
state's  accounting system  and  any  ongoing projects  were                                                                    
split  into  the  two  new departments.  He  deferred  to  a                                                                    
colleague for additional detail.                                                                                                
4:33:29 PM                                                                                                                    
SYLVAN  ROBB, ASSISTANT  COMMISSIONER, DEPARTMENT  OF HEALTH                                                                    
AND  SOCIAL SERVICES  (via  teleconference), responded  that                                                                    
she  concurred  with   Director  Steiningers   remarks.  She                                                                    
explained that the MMIS was  a complex system that took many                                                                    
years to  develop, and  the department  was still  using the                                                                    
funding.  She was  also ensuring  that  all expenditures  in                                                                    
older capital  projects were  properly accounted  for before                                                                    
they  closed   the  projects  as   they  divided   into  two                                                                    
departments. She  anticipated that they may  find several of                                                                    
the projects  may be able  to be  closed but they  wanted to                                                                    
proceed with caution.                                                                                                           
Representative Carpenter asked how  complete the MMIS was in                                                                    
percentages. Ms.  Robb was uncertain and  offered to provide                                                                    
the answer.  Representative Carpenter  opined that  15 years                                                                    
was a  long time  to drag  out a project  and it  failed the                                                                    
 common sense test.                                                                                                             
4:35:39 PM                                                                                                                    
AT EASE                                                                                                                         
4:35:47 PM                                                                                                                    
Representative  Carpenter referenced  the second  project in                                                                    
his   earlier   question.   He   asked   if   the   original                                                                    
appropriation  was creating  an information  exchange system                                                                    
and whether  the system  was still  ongoing 13  years later.                                                                    
Ms.  Robb  answered  that the  Health  Information  Exchange                                                                    
(HIE)  was  an  ongoing  project.  She  indicated  that  the                                                                    
exchange  was a  tool that  allowed healthcare  providers to                                                                    
connect  their electronic  health records  systems. The  HIE                                                                    
was  mandated  in state  statute  and  was required  by  the                                                                    
Centers for  Medicare and Medicaid Services.  Alaska was not                                                                    
the only state  that had a  long runway  for  setting up the                                                                    
information exchange  and it was  something all  states were                                                                    
working on.  It had  been a lengthy  process for  almost all                                                                    
states.  She added  that as  technology changed  the project                                                                    
had morphed  over time.  Representative Carpenter  wanted to                                                                    
know how  much of  the $25  million appropriation  was state                                                                    
funds  versus  federal  funds.  He pointed  to  the  item  5                                                                    
reappropriation  for  Electronic   Health  Record  Incentive                                                                    
Payments on  page 57, Section 14  of the bill in  the amount                                                                    
of $36.5 million from FY 2011  and asked why the funding was                                                                    
carried forward  since 2011 and  what was the  split between                                                                    
federal and state funding.                                                                                                      
4:38:28 PM                                                                                                                    
Ms. Robb  answered that the  state was no longer  making the                                                                    
incentive payments  for participation in HIS.  She mentioned                                                                    
that the  department was in  the middle of an  active effort                                                                    
to ensure  capital appropriations  were cleaned up  and they                                                                    
were  reluctant  to close  out  a  few projects  before  the                                                                    
cleanup  process  was  completed. She  reiterated  that  the                                                                    
administration  was in  the process  of splitting  DHSS into                                                                    
the Department  of Health and  the Department of  Family and                                                                    
Community  Services.  She  commented   that  DHSS  had  many                                                                    
capital projects  and she had  hoped the process  would have                                                                    
been  completed  sooner. Representative  Carpenter  reasoned                                                                    
that there  was a  benefit to  splitting the  department. He                                                                    
discerned that  before the funds were  reappropriated it was                                                                    
logical to  know whether the  funds were needed and  if not,                                                                    
the state portion could be  reappropriated somewhere else or                                                                    
federal  money  could be  returned.  He  reiterated that  in                                                                    
Section  14 there  were a  number  of reappropriations  that                                                                    
were a  decade or  older and  he had  the same  question for                                                                    
each  item. He  asked for  a blanket  request to  understand                                                                    
each item and whether they were necessary.                                                                                      
Mr. Steininger  answered in the  affirmative. He  noted that                                                                    
the  department could  quickly provide  a  list through  its                                                                    
annual  report,  Capital  Appropriation  Status Report.   He                                                                    
furthered   that  there   was   a   significant  amount   of                                                                    
administrative work  to divide the department  and much more                                                                    
time  was  spent on  that.  When  the reappropriations  were                                                                    
requested,  DHSS  decided  where the  funding  belonged  and                                                                    
wanted to  work to  decide what reappropriations  were still                                                                    
active or could  be closed out in the next  fiscal year. The                                                                    
task  was   sidelined  in  the   hierarchy  of   tasks  that                                                                    
prioritized   what  other   administrative  functions   were                                                                    
valuable to  ensure an effective and  successful transition.                                                                    
He  agreed that  keeping outdated  capital projects  ongoing                                                                    
created an  unnecessary administrative burden.  However, the                                                                    
focus  of  the transition  was  to  clear up  administrative                                                                    
issues first.                                                                                                                   
4:42:50 PM                                                                                                                    
Representative Carpenter  understood Mr.  Steiningers  logic                                                                    
behind  the decision.  He asserted  that the  Capital Budget                                                                    
for the current  year needed immediate action.  He wanted to                                                                    
consider the reappropriations in  the current capital budget                                                                    
and make  decisions. He stated  that the items were  on  his                                                                    
agenda.  He  requested more  information regarding  the $100                                                                    
million  to determine  what needed  to be  reappropriated in                                                                    
the  FY  23  budget  and  what  could  immediately  be  made                                                                    
available  for other  priority items.  Mr. Steininger  would                                                                    
follow up with the information.                                                                                                 
Vice-Chair  Ortiz   appreciated  Representative  Carpenters                                                                     
line of  questioning. He wondered  whether the  $100 million                                                                    
was appropriated  each year since the  initial appropriation                                                                    
and  whether   the  funds  were  expended   each  year.  Mr.                                                                    
Steininger replied  that the initial appropriation  year was                                                                    
listed   and  was   expended  over   time  as   the  project                                                                    
progressed.  He elaborated  that part  of the  annual review                                                                    
included looking  at capital  projects to  determine whether                                                                    
there  were   annual  meaningful  expenditures   or  ongoing                                                                    
obligations  to decide  if they  should be  administratively                                                                    
terminated  and   trigger  an   effective  lapse   date.  He                                                                    
furthered  that  many  of  the   funds  remaining  on  older                                                                    
projects tended  to be federal  authority so there  was less                                                                    
incentive to  reappropriate the funding. He  reiterated that                                                                    
the capital appropriation report  produced by OMB showed the                                                                    
detail of  the unobligated  amounts of  both GF  and federal                                                                    
authority.  He  would  provide a  summary  showing  all  the                                                                    
projects to show  which had either general  funds or federal                                                                    
authority. Vice-Chair  Ortiz exemplified  line 23  and noted                                                                    
appropriations  for $36  million and  $518 thousand  for the                                                                    
Electronic  Health Record  Incentive  Payments  in 2011.  He                                                                    
wondered if  since 2011, the  department was in  the process                                                                    
of  expending the  $36 million.  Mr. Steininger  answered in                                                                    
the affirmative. He  added that the incentives  were sent to                                                                    
practitioners  for establishing  electronic health  records.                                                                    
He deferred to Ms. Robb for details.                                                                                            
Ms.  Robb  replied that  the  department  would provide  the                                                                    
status report to the committee.  She agreed that most of the                                                                    
projects  listed had  primarily federal  funding without  GF                                                                    
match and could not be reappropriated for other projects.                                                                       
4:48:01 PM                                                                                                                    
Representative  Carpenter   asked  if  the   dollar  figures                                                                    
reflected the  year the appropriation  had been made  or the                                                                    
remaining dollar figure. Mr. Steininger  asked for a copy of                                                                    
the bill.  He replied  that the numbers  listed in  the bill                                                                    
were  the  original  appropriation  amounts.  Representative                                                                    
Carpenter asked OMB to provide  the actual remaining amounts                                                                    
to be reappropriated in the follow up information.                                                                              
4:49:48 PM                                                                                                                    
Representative  Carpenter  assumed that  whatever  remaining                                                                    
amount  of federal  funds there  were funds  sitting in  the                                                                    
General Fund and  Other Non-Segregated Investments (GeFONSI)                                                                    
or  other accounts.  He wondered  whether the  federal funds                                                                    
were accruing  interest, were usable for  other purposes, or                                                                    
just sat  in an  account. Mr.  Steininger answered  that the                                                                    
federal funding  was receipt authority  and was not  cash on                                                                    
hand. He clarified that most  federal programs operated on a                                                                    
reimbursable  basis. The  state  sent  monthly or  quarterly                                                                    
bills to the federal government for reimbursement.                                                                              
Co-Chair Merrick noted there would be public testimony for                                                                      
HB 283 the following day and would be limited to two                                                                            
HB 283 was HEARD and HELD in committee for further                                                                              
Co-Chair Merrick reviewed the schedule for the following                                                                        
4:51:54 PM                                                                                                                    
The meeting was adjourned at 4:51 p.m.                                                                                          

Document Name Date/Time Subjects
HB 226 Amendments 1-4.pdf HFIN 5/3/2022 1:30:00 PM
HB 226
HB 283 Public Testimony Rec'd by 050322.pdf HFIN 5/3/2022 1:30:00 PM
HB 283
HB 226 Supporting Document - Salary Increase Compare 050322.pdf HFIN 5/3/2022 1:30:00 PM
HB 226
HB 226 HFC Courts Meade letter correction 050422.pdf HFIN 5/3/2022 1:30:00 PM
HB 226