Legislature(2021 - 2022)ADAMS 519
05/13/2022 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB131 | |
| SB173 | |
| SB20 | |
| SB243 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SB 131 | TELECONFERENCED | |
| += | SB 173 | TELECONFERENCED | |
| += | SB 20 | TELECONFERENCED | |
| += | SB 243 | TELECONFERENCED | |
HOUSE FINANCE COMMITTEE
May 13, 2022
1:35 p.m.
1:35:18 PM
CALL TO ORDER
Co-Chair Merrick called the House Finance Committee meeting
to order at 1:35 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
None
ALSO PRESENT
Scott Jordan, Director, Division of Risk Management,
Department of Administration; Nils Andreassen, Executive
Director, Alaska Municipal League; Nikki Rose, Staff,
Senator Roger Holland; Senator David Wilson, Sponsor;
Jasmine Martin, Staff, Senator David Wilson; Senator Gary
Stevens, Sponsor; Tim Lamkin, Staff, Senator Gary Stevens;
Tim Grussendorf, Staff, Senator Lyman Hoffmann;
Representative Mike Cronk.
PRESENT VIA TELECONFERENCE
Richard Etheridge, Alaska Fire Chiefs Association, Juneau;
Charles Collins, Director, Division of Workers'
compensation, Department of Labor and Workforce
Development; Lori Wing-Heier, Director, Division of
Insurance, Department of Commerce, Community and Economic
Development; Sara Chambers, Director, Division of
Corporations, Business and Professional Licensing,
Department of Commerce, Community and Economic Development;
Jayme Parker, Chief of Public Health Labs, Department of
Health and Social Services; Jason Ball, Quality Assurance
Manager, Division of Health Care Services, Department of
Health and Social Services; Sondra Meredith, Administrator,
Teacher Education and Certification, Department of
Education and Early Development; Deborah Riddle, Operations
Manager, Department of Education and Early Development;
Curtis Thayer, Executive Director, Alaska Energy Authority,
Department of Commerce, Community and Economic Development;
Tim Sandstrom, Chief Operating Officer, Alaska Energy
Authority.
SUMMARY
CSSB 20(FIN)
OUT OF STATE TEACHER RECIPROCITY
CSSB 20(FIN) was REPORTED out of committee with
five "do pass" recommendations, one "do not pass"
recommendation, three "no recommendation"
recommendations, and one "amend" recommendation
and with one previously published fiscal impact
note: FN3 (EED).
SB 131(title am)
WORKERS' COMP DISABILITY FOR FIREFIGHTERS
HCS SB 131(FIN) was REPORTED out of committee
with five "do pass" recommendations and five "no
recommendation" recommendations and with one new
zero fiscal note from the Department of Labor and
Workforce Development and one new fiscal impact
note from the Department of Administration.
CSSB 173(FIN)
DENTIST SPEC. LICENSE/RADIOLOGIC EQUIP
HCS CSSB 173(FIN) was REPORTED out of committee
with seven "do pass" recommendations and four "no
recommendation" recommendations and with three
previously published fiscal impact notes: FN1
(DHS), FN2 (DHS), and FN3 (CED).
CSSB 243(FIN)
PWR COST EQ: RAISE, ENDOW FUND INVESTMENT
CSSB 243(FIN) was REPORTED out of committee with
five "do pass" recommendations and five "no
recommendation" recommendations and with one
previously published fiscal impact note: FN1
(CED).
Co-Chair Merrick reviewed the meeting agenda.
SENATE BILL NO. 131(title am)
"An Act relating to the presumption of compensability
for a disability resulting from certain cancers in
firefighters."
1:36:03 PM
Co-Chair Merrick indicated the committee would take up the
three amendments that were submitted to her office.
1:36:36 PM
Co-Chair Merrick OPENED public testimony.
1:36:53 PM
AT EASE
1:37:14 PM
RECONVENED
1:37:28 PM
RICHARD ETHERIDGE, ALASKA FIRE CHIEFS ASSOCIATION, JUNEAU
(via teleconference), spoke in support of SB 131. He shared
that he had been a firefighter in Alaska for over 30 years.
During his career, he had learned that many job related
things had been documented to cause cancer in firefighters.
He listed items known to cause cancer to firefighters on
the job including structure fire smoke, soot buildup in
gear, firehalls that contained diesel buildup, fire foam,
and protective gear containing PFAS. With the knowledge of
the problems, methods had been developed to reduce risk as
much as possible. He shared that if a firefighter's cancer
was on the presumptive list, they had to prove they met the
strict requirements to qualify for the workers'
compensation program. He explained that if the cancer was
not on the presumptive list, it still may be a workplace
illness; it meant firefighters then had a harder job to
prove what caused the cancer.
Mr. Etheridge provided additional detail. He stated that SB
131 did not create additional liability for municipalities.
The bill specified that if a person had an approved cancer,
they would not be forced to go through a protracted
bureaucratic process. He stated that according to the
Workers' Compensation office, there had been very few
claims filed. He relayed that the state insurance director
had testified at a recent hearing that the cost to the
state was so negligible it was not measured. He highlighted
that female firefighters deserved cancer protection equal
to their male counterparts. He asked the committee to pass
the legislation to protect firefighters.
1:40:58 PM
Co-Chair Merrick CLOSED public testimony.
Co-Chair Merrick indicated there were two fiscal notes to
review.
SCOTT JORDAN, DIRECTOR, DIVISION OF RISK MANAGEMENT,
DEPARTMENT OF ADMINISTRATION, reviewed Fiscal Note 3. The
fiscal note was indeterminate because there was no data in
the system regarding cancer diseases with firefighters. The
department had attached average costs for cancers found
online. He added the note factored in death benefits that
would go to a firefighter's dependents if the firefighter
died due to the illness.
Co-Chair Merrick asked the department to review the second
fiscal note.
CHARLES COLLINS, DIRECTOR, DIVISION OF WORKERS'
COMPENSATION, DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT
(via teleconference), reviewed the zero fiscal note
(control code: iAIPv) by Department of Labor and Workforce
Development. He relayed that the division did not cover any
firefighters; therefore, there it would see no added
expense. He noted the actuary was unable to provide a
number on cost; the synopsis was included with the note.
1:44:13 PM
Representative Josephson MOVED to ADOPT Amendment 1, 32-
LS0598\G.1, (Marx, 4/29/22)(copy on file):
Page 1, line 2, following "firefighters":
Insert"; relating to the payment of workers'
compensation benefits in the case of permanent partial
impairment; relating to the payment of workers'
compensation death benefits; and providing for an
effective date"
Page 3, following line 6:
Insert new bill sections to read:
"* Sec. 3. AS 23.30.190(a) is amended to read:
(a) In case of impairment partial in character but
permanent in quality, and not resulting in permanent
total disability, the compensation is $273,000
[$177,000] multiplied by the employee's percentage of
permanent impairment of the whole person. The
percentage of permanent impairment of the whole person
is the percentage of impairment to the particular body
part, system, or function converted to the percentage
of impairment to the whole person as provided under
(b) of this section. The compensation is payable in a
single lump sum, except as otherwise provided in AS
23.30.041, but the compensation may not be discounted
for any present value considerations.
* Sec. 4. AS 23.30.215(a) is amended to read:
(a) If the injury causes death, the compensation is
known as a death benefit and is payable in the
following amounts to or for the benefit of the
following persons:
(1) reasonable and necessary funeral expenses not
exceeding $12,000 [$10,000];
(2) if there is a widow or widower or a child or
children of the deceased, the following percentages of
the spendable weekly wages of the deceased:
(A) 80 percent for the widow or widower with no
children;
(B) 50 percent for the widow or widower with one child
and 40 percent for the child;
(C) 30 percent for the widow or widower with two or
more
children and 70 percent divided equally among the
children;
(D) 100 percent for an only child when there is no
widow or
widower;
(E) 100 percent, divided equally, if there are two or
more children and no widow or widower;
(3) if the widow or widower remarries, the widow or
widower is entitled to be paid in one sum an amount
equal to the compensation to which the widow or
widower would otherwise be entitled in the two years
commencing on the date of remarriage as full and final
settlement of all sums due the widow or widower;
(4) if there is no widow or widower or child or
children, then for the support of father, mother,
grandchildren, brothers, and sisters, if dependent on
[UPON] the deceased at the time of injury, 42 percent
of the spendable weekly wage of the deceased to such
beneficiaries, share and share alike, not to exceed
$150,000 [$20,000) in the aggregate;
(5) $8,000 [$5,000] to a surviving widow or widower,
or equally divided among surviving children of the
deceased if there is no widow or widower.
* Sec. 5. AS 23.30.215 is amended by adding a new
subsection to read:
(j) A death benefit payable to a child under (a)(2)(D)
or (E) of this section continues until the child
reaches 23 years of age, unless extended under AS
23.30.395(8)."
Renumber the following bill section accordingly.
Page 3, lines 9 - 10:
Delete all material and insert:
"APPLICABILITY. AS 23.30.12l(b), as amended by sec. 1
of this Act, and AS 23.20.121(?), as amended by sec. 2
of this Act, apply to claims made on or after the
effective date of secs. 1 and 2 of this Act."
Page 3, following line 10:
Insert a new bill section to read:
"* Sec. 7. This Act takes effect January 1, 2023."
Co-Chair Merrick OBJECTED for discussion.
Representative Josephson reviewed the amendment that was
identical to a bill (HB 30) passed out of the House Finance
Committee and was passed on the House floor by a vote of 29
to 10. He shared that he had been working on the topic for
nine years. The amendment included an update to permanent
and partial impairment. He had seen the issue through the
House three times. He had informed the sponsor of SB 131 of
his intention to offer the amendment. The sponsor had not
asked him to offer the amendment or not offer the
amendment. He stated that the bill was backed by the Alaska
General Contractors, the Alaska Builders and Contractors,
and the Fairbanks Chamber of Commerce. Additionally, the
bill was affordable. He shared that Mr. Collins with the
Division of Workers' compensation had testified there had
been a cumulative reduction in in workers' compensation of
40 percent over the last eight years. The bill would cause
a net 14 percent increase. He stressed that Alaska did not
th
want to be the 46 state for disability due to workers'
compensation.
Co-Chair Merrick WITHDREW the OBJECTION.
There being NO further OBJECTION, Amendment 1 was ADOPTED.
1:46:24 PM
Vice-Chair Ortiz MOVED to ADOPT Amendment 2, 32-LS0598\G.2,
(Marx, 5/13/22) (copy on file):
Page 1, line 2, following "firefighters":
Insert"; relating to occupational diseases; and
relating to the fishermen's fund"
Page 3, following line 6:
Insert a new bill section to read:
"* Sec. 3. AS 23.35.150(5) is amended to read:
(5) "occupational disease" means hernia; varicose
veins of the leg; the respiratory diseases, novel
coronavirus disease (COVID-19), bronchitis, pleurisy,
and pneumonia caused by or aggravated by the fishing
endeavor, but excluding the common cold and influenza;
rheumatism, arthritis, and those musculoskeletal
diseases (such as bursitis, traumatic sciatica, and
tenosynovitis) directly caused by or aggravated by the
fishing endeavor; and does not include a disease not
common to both sexes, venereal disease, or a condition
arising out of an attempt of a fisherman to injure
self or another."
Renumber the following bill section accordingly.
Page 3, line 9:
Delete "AS 23.30.121(b) and (f), as amended by this
Act, apply"
Insert "This Act applies"
Co-Chair Merrick OBJECTED for discussion.
Vice-Chair Ortiz explained the amendment was a self-
contained issue to the Fishermen's Fund and there would be
no added fiscal cost to workers' compensation, the state's
fiscal obligations, or local municipalities' fiscal
obligations. The amendment added the COVID-19 portion of SB
131 to the Fishermen's Fund. There was no cost to anyone
other than fishermen, who had requested adding the benefit
to their fund.
1:47:29 PM
Representative Johnson asked if the amendment would add
COVID-19 as one of the occupational [inaudible]. She asked
for further clarification.
Vice-Chair Ortiz replied that the virus spread more rapidly
when people were confined in a fishing boat. He clarified
the issue was whether or not people who were part of the
Fishermen's Fund felt they needed some added insurance
protection from COVID-19. He explained their health
insurance was from the Fishermen's Fund. He explained that
the inclusion may add to fishermen's premiums or other
cost. He clarified that any associated costs would be taken
care of by fishermen. He added the inclusion had been
requested by fishermen.
Representative Johnson surmised the amendment added the
Fishermen's Fund to the bill.
Vice-Chair Ortiz provided further clarification. He
explained the amendment matched the theme of the bill
because the bill talked about adding COVID-19 to workers'
compensation. The benefit was only about the Fishermen's
Fund and would be paid for by fishermen. He clarified it
was the fishermen's health insurance program.
1:49:57 PM
Representative Carpenter understood the concept of
occupational disease as something that specifically related
to the occupation. He listed health problems such as
varicose veins, a hernia, bronchitis, and pneumonia. He
thought the Coronavirus had more in common with the flu
than a hernia. He remarked that the amendment would add the
Coronavirus, but current statute excluded influenza. He
thought it appeared to go against the underlying theme of
the statute.
Co-Chair Merrick asked Mr. Collins if he had a response.
Mr. Collins offered that Fishermen's Fund insurance did not
work like workers' compensation. He explained it was merely
a reimbursement of expenses to the boat or fishermen. He
elaborated that fishermen did not pay premiums they paid a
fee on their license purchased through the Department of
Fish and Game. He informed committee members that the setup
of the Fishermen's Fund had been set since prior to
statehood. He was not aware of any requests from the Fish
Fund Council on coverage for COVID-19. He was surprised to
hear the amendment. He added the amendment would not impact
the cost to any claims because it was a fee fishermen
charged themselves to cover the Fishermen's Fund, which was
a reimbursement vehicle and not insurance.
Representative Carpenter asked why the common cold and
influenza were excluded.
1:52:56 PM
AT EASE
1:53:34 PM
RECONVENED
Co-Chair Merrick indicated Representative Rasmussen had
joined the meeting.
Vice-Chair Ortiz WITHDREW Amendment 2. He remarked there
were some reasonable questions about the amendment, and he
was not the person to answer them. He would get the answers
to the questions.
1:54:07 PM
Representative LeBon MOVED to ADOPT Conceptual Amendment 1
(copy on file):
Page 1, line 13
Delete "skin cancer [MALIGNANT MELANOMA];"
Insert "malignant melanoma;"
Page 2, line 4
Add "and"
Page 2, lines 6-12
Delete all material
Co-Chair Merrick OBJECTED for discussion.
Representative LeBon reviewed the conceptual amendment. He
pointed to page 1, line 13 of the bill and explained the
amendment would delete skin cancer and replace it with
malignant melanoma. Additionally, on page 2, line 4, the
word "and" was added following the words "prostate cancer"
and lines 6 through 12 would be deleted. The paragraph
would end with the words "and with breast cancer." The
subsequent cancers would be deleted. He was trying to
strike a balance between reasonable risk and cost and the
burden that would befall municipalities, cities, and
organized boroughs. The original version of the bill simply
added breast cancer to the list of cancers firefighters had
a presumption and that the claim for workers' compensation
may result through their employment. He elaborated that due
to the limited number of claims, breast cancer did not seem
to have a significant impact on workers' compensation rates
paid by the state and municipality employers of
firefighters.
Representative LeBon explained that the House Labor and
Commerce Committee added the seven additional cancers he
listed and proposed for removal. He stated that the
indeterminate fiscal note from the House Labor and Commerce
Committee only showed possible cost to the state as an
employer of airport firefighters. He remarked that House
Finance Committee had heard from Nils Andreassen with the
Alaska Municipal League who had suggested that Alaska
municipal communities, towns, cities, boroughs had raised
concerns and suggested that the state consider capitalizing
a trust fund that would cover the presumptive conditions.
He noted at the current point in session it was difficult
to evaluate the proposed solution. He continued that the
amendment would help reduce the uncertainty to communities
while consideration of the additional cancers could be
raised at a future time if deemed appropriate.
1:57:10 PM
Representative Josephson thought Ms. Lori Wing-Heier
testified that it would not cost the state much because
they [the cancers] were uncommon. He was disinclined to
remove the additions.
1:58:12 PM
LORI WING-HEIER, DIRECTOR, DIVISION OF INSURANCE,
DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT
(via teleconference), indicated Representative Josephson's
comments were accurate. She relayed there was no data for
Alaska or other jurisdictions expanding benefits for
firefighters. She explained that every state had the
presumptions and Alaska's were fairly strict and the cases
were few and far between. She elaborated there was not a
trend for any actuary or insurer to attest that the bill
and the inclusion of one cancer or ten cancers would have
an impact on the cost to the firefighting organizations.
She considered that perhaps it would in the future;
however, at the current point, cases were so few and far
between, there was no data to suggest the rates would
increase.
Representative LeBon asked how many of the firefighters
impacted by the bill were state employed versus employed by
cities, boroughs, and municipalities.
Ms. Wing-Heier responded that she would have to follow up
with the information. She noted that many of the smaller
fire departments such as Chugiak and Cooper Landing (those
fire departments surviving on bake sales) would not be able
to afford to have their members get an annual physical to
qualify for "this." As for the number of state
firefighters, she deferred to Mr. Jordan.
Representative LeBon asked who bore the cost of the risk
for a municipality, city, or borough with their volunteer
or paid fire departments. He asked if it would be the
municipality versus the state.
Ms. Wing-Heier responded that the employer of record would
pay the cost for the workers' compensation claim if they
were self-insured or for the workers' compensation
insurance.
Representative LeBon remarked that he was speaking about
the bigger population, while Ms. Wing-Heier was referring
to the smaller population.
Co-Chair Merrick asked if Mr. Jordan could respond.
2:01:37 PM
Mr. Jordan reported that there were 1,300 fire fighters
working for the state; however, the majority were seasonal
wildfire firefighters for the Department of Natural
Resources. He believed about 100 to 120 of the total were
fulltime employees working for the airports.
Representative LeBon asked about the difference in the size
of the two groups in major communities employing
firefighters including Fairbanks, Anchorage, Kenai, Juneau,
Wasilla.
Mr. Jordan did not have the numbers, but he suspected the
number was quite a bit higher than the number of
firefighters working for the state.
Representative Thompson asked Mr. Collins to comment.
2:02:52 PM
Mr. Collins reported that under workers' compensation,
Anchorage, Mat-Su, Kenai, Fairbanks, Juneau, and possibly
Ketchikan, were all self-insured entities. He explained
that any firefighters under the entities would be paid
under self-insurance. The department did not track an
organization's employees by job classification. He remarked
that the self-insured entities likely had more firefighters
than those employed by the two airports.
Representative LeBon asked to hear from Mr. Nils
Andreassen. He was interested in the firefighter
population.
2:04:39 PM
NILS ANDREASSEN, EXECUTIVE DIRECTOR, ALASKA MUNICIPAL
LEAGUE, believed there were more than 1,000 municipal
firefighters. He discussed the distinction between self-
insured firefighters and those who were not. The larger
municipalities were self-insured and managed their risk
independently of other municipalities; they would manage
the impacts of the bill on their own. He referenced letters
in committee members' packets from APEI [Alaska Public
Entity Insurance] and AMLJIA [Alaska Municipal League Joint
Insurance Association]. He elaborated the entities were
pools formed under statute to allow for risk sharing. He
explained that all of the smaller municipalities were
members of those pools. The impacts of the bill would be
felt by every other municipal employer. He listed location
examples including Kwethluk, Russian Mission, Kotzebue, and
Kodiak. There was a distinction between an employer picking
up the costs versus a pool picking up the costs. He
explained that a pool would have very different assets
available to deal with the claims. He stated that even
infrequent claims could have challenging impacts to the
pools.
2:06:25 PM
Representative Josephson asked if malignant melanoma
referred to a precancerous skin condition, which would
allow for denial of claims. He asked if skin cancer was a
broader disease than malignant melanoma.
Ms. Wing-Heier responded that she did not have the answer
to his question.
Mr. Collins pointed out that melanoma was already in
statute and there had been a change in the Labor and
Commerce Committee to include the broader term "skin
cancer." He believed the amendment would change the
language back to current statute.
Representative Wool stated that malignant melanoma was skin
cancer.
2:08:36 PM
Representative Josephson shared he had seen a Centers for
Disease Control and Prevention (CDC) report from 2016 that
indicated firefighters were subject to cancers like
testicular cancer and multiple myeloma. He stated the
cancers were listed in the bill. He did not believe the
change would be significantly impactful and he trusted in
the co-chairs of the House Labor and Commerce Committee.
Co-Chair Merrick MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: LeBon, Thompson, Carpenter
OPPOSED: Wool, Josephson, Ortiz, Rasmussen, Johnson,
Foster, Merrick
Representative Edgmon was absent from the vote.
The MOTION to adopt conceptual Amendment 1 FAILED (3/7).
Vice-Chair Ortiz relayed he would not be offering Amendment
2.
Representative Josephson spoke in support of the bill. He
referred to SB 131 as "a very fine bill" that was not
costly and would help keep Alaskans healthier and safer.
Representative Carpenter asked how the International Agency
for Research on Cancer (ARC) and the National Toxicology
Program (NTP) defined exposure. He cited testimony stating
the following items were hazardous: diesel particles at the
fire station, smoke from fires, soot residue on the
personal protective equipment (PPE), and materials in the
manufacturing of the PPE.
2:12:18 PM
NIKKI ROSE, STAFF, SENATOR ROGER HOLLAND, responded that
there had been prior testimony in several committees from
fire fighters stating the exposure was logged by Alaskan
fire fighters in incident logs. She elaborated that fire
fighters were instructed to record which chemicals they
were exposed to. She explained that the incident logs
included the information on chemical exposure and dates.
The legislation stated that after a period of seven years
of annual exams and no cancer detected, there was an
opportunity to reexamine the information in the logs. The
fire departments were responsible for storing the logs.
2:13:34 PM
Representative Carpenter asked if it indicated that any
time a fire fighter wore their PPE they filed an exposure
record in the log.
Ms. Rose did not know the answer to the question.
Co-Chair Merrick invited Mr. Etheridge to answer the
question.
2:14:14 PM
Mr. Etheridge responded that detailed training records were
kept. Additionally, anytime firefighters went into a fire
or hazardous materials response, the department was
required to record the information. He stated there was no
record if someone merely put on the protective gear at the
fire station.
Representative Carpenter considered the definition of
exposure. He used a hypothetical example where the PPE
equipment was carcinogenic. He elaborated that if a person
put on the PPE during a training session it was not
considered exposure; however, when the person wore the
equipment while fighting a fire it was considered an
exposure. He remarked that under the scenario, the
firefighter was deciding when they were exposed. He pointed
out that the law specified an exposure was defined by the
ARC and NTP. He did not understand whether the process
involved an individual specifying when exposure occurred or
whether the agencies defined when a person could consider
when exposure had occurred.
Mr. Etheridge did not have any comments about how they
define exposure based on those organizations. He relayed
the department had only found out about the PFAS in bunker
gear fabric in the past year and a half. He remarked it
showed the trend of all of the new things that could
potentially cause cancer.
Representative Johnson commented that in the research she
had done on the bill she had learned firefighting equipment
contained cancer causing materials if exposed to fire. She
remarked that one of the safety mechanisms was to separate
firefighters from the equipment after a fire. She asked if
Representative Carpenter was trying to say that a person's
exposure may not be defined by the length of time spent
fighting a fire, but also in the equipment associated with
cancer causing elements.
Representative Carpenter had some personal military
experience with wearing PPE that was supposed to provide
protection from hazardous things. He used an example and
stated a person would know if they had been exposed to
anthrax because they would get sick and possibly die. He
noted there were decontamination processes when PPE was
donned to provide protection from the environment. He
stated the law specified the firefighter was exposed to a
known carcinogen as defined by the two organizations. He
was trying to understand how the organizations were
defining exposure because the firefighter was not dying
immediately when gear was removed. He did not know whether
the firefighter had actually been exposed when the gear was
removed.
Co-Chair Merrick asked Ms. Rose if it was possible to do
some research and get back to the committee.
Ms. Rose answered that she had just received information
from the firefighters that the ARC and NTP listed and
categorized known carcinogens. She elaborated that
firefighters likely had to prove to the workers'
compensation board that the exposure took place. The board
would refer back to the list of known carcinogens.
2:20:03 PM
Co-Chair Foster MOVED to report HCS SB 131(FIN) out of
Committee with individual recommendations and the
accompanying fiscal notes.
There being NO OBJECTION, it was so ordered.
HCS SB 131(FIN) was REPORTED out of committee with five "do
pass" recommendations and five "no recommendation"
recommendations and with one new zero fiscal note from the
Department of Labor and Workforce Development and one new
fiscal impact note from the Department of Administration.
2:20:29 PM
AT EASE
2:22:01 PM
RECONVENED
CS FOR SENATE BILL NO. 173(FIN)
"An Act relating to the practice of dentistry;
relating to dental radiological equipment; and
providing for an effective date."
2:22:01 PM
Co-Chair Merrick relayed it was the second bill hearing and
no amendments had been received.
Co-Chair Merrick OPENED public testimony.
Co-Chair Merrick CLOSED public testimony.
Co-Chair Merrick indicated there were three fiscal notes.
She invited the Department of Commerce, Community and
Economic Development (DCCED) to review Fiscal Note 3.
2:23:04 PM
SARA CHAMBERS, DIRECTOR, DIVISION OF CORPORATIONS, BUSINESS
AND PROFESSIONAL LICENSING, DEPARTMENT OF COMMERCE,
COMMUNITY AND ECONOMIC DEVELOPMENT (via teleconference),
relayed the fiscal note had several components because the
bill had two primary purposes. One of the purposes was to
reinstitute specialty licensing, which would require the
department to add several new licenses and additional work
to its team. The department was requesting one additional
occupational licensing examiner. Currently, the large
program only had one dedicated staff member. The second
major component was the department's need to coordinate and
cooperate with Department of Health and Social Services
(DHSS) on radiological equipment administration. She
elaborated that DCCED planned to enter into an interagency
agreement with DHSS in the amount of $224,000, which was
reflected on the services line and in one of the DHSS
fiscal notes. She explained the money had to be accounted
for leaving one department and coming into the other
department.
Representative Carpenter asked how many equipment
inspections had to be done each year.
Ms. Chambers responded that there were currently about
2,000 pieces of equipment would have to be inspected every
six years. She elaborated that DHSS could speak more
specifically to the cost because it would be performing the
work. She relayed it a rolling cost over six years to
ensure a position could support all of the inspection
across the state.
2:25:36 PM
Representative Carpenter estimated it meant that just under
one piece of equipment would need to be inspected each day.
He asked what the additional position would do apart from
conducting inspections.
Ms. Chambers responded that DCCED would no longer be doing
the inspections; the bill handed the responsibility off to
DHSS. She noted that DCCED would have a new occupational
licensing examiner position, which would take on the extra
work the new specialty licensing scheme reintroduced by the
bill would mandate. The department currently had one person
for about 7,000 licensees and DCCED could not expand the
program further without additional staff support.
Co-Chair Merrick indicated there were two remaining fiscal
notes to be reviewed. She asked DHSS to review the fiscal
note with OMB component 2252.
2:27:16 PM
JAYME PARKER, CHIEF OF PUBLIC HEALTH LABS, DEPARTMENT OF
HEALTH AND SOCIAL SERVICES (via teleconference), reviewed
fiscal note (control code ckCce). She relayed the fiscal
note for the Department of Health labs started with an
initial investment of $193,200, which allowed the
department to recruit for and hire an additional
radiological health physicist to help monitor, register,
and inspect an additional 2,200 to 2,400 devices. The
department currently managed about 1,000. The department
was also suggesting an additional office assistant to help
the department with communication with DCCED because DCCED
would be collecting the fees and DHSS would be invoicing.
The position would also assist with travel for two
radiological health specialists. Beyond the initial
investment in FY 23, the department saw an increase to
$224,200 because it assumed it would take three to four
months to hire someone in FY 23; therefore, the entire
salary and benefit would not be necessary until FY 24. The
department expected the $224,000 to be covered by fees. She
confirmed the number equated to inspection of about one
device per day, but the department could inspect more than
that number. There was other x-ray equipment the department
inspected across the state; therefore, the department
expected to cross-train the positions to inspect x-ray and
dental equipment. The department anticipated the travel
cost would be reduced. She shared the cost equated to
approximately $100 per devise per year or $600 per device
for six years.
Co-Chair Merrick invited Mr. Jason Ball with DHSS to review
Fiscal Note 2.
2:30:12 PM
JASON BALL, QUALITY ASSURANCE MANAGER, DIVISION OF HEALTH
CARE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES
(via teleconference), reviewed Fiscal Note 2 (control code:
ARTso), which included $92,000 per year on the personal
services line in addition to some additional commodity
expenditure related to setting up the new position. He
stated there was an impact to the Medicaid provider
enrollment component related to the specialty piece and
implementing the specialty licenses required by the federal
government at initial enrollment and revalidation on a
three to five-year interval depending on a provider's risk
level. The department was required to take up a body of
work to ensure providers were practicing in their approved
specialties. The department had to ensure the integrity of
the claims billed on behalf of newly created specialists on
an ongoing basis in order to draw down federal funds.
Co-Chair Merrick asked if the departments had any input
regarding Representative Carpenter's question.
2:32:15 PM
Co-Chair Foster MOVED to report HCS CSSB 173(FIN) out of
Committee with individual recommendations and the
accompanying fiscal notes.
There being NO OBJECTION, it was so ordered.
HCS CSSB 173(FIN) was REPORTED out of committee with seven
"do pass" recommendations and four "no recommendation"
recommendations and with three previously published fiscal
impact notes: FN1 (DHS), FN2 (DHS), and FN3 (CED).
2:32:40 PM
AT EASE
2:33:39 PM
RECONVENED
CS FOR SENATE BILL NO. 20(FIN)
"An Act relating to teaching certificates for teachers
holding out-of-state certificates."
2:33:51 PM
Co-Chair Merrick indicated there was one amendment for
SB 20.
2:34:05 PM
Representative Thompson MOVED to ADOPT Amendment 1, 32-
LS0202\W.1, (Marx, 5/2/22)(copy on file):
Page 1, line 1, following "Act":
Insert "relating to the right of a child of school age
to attend school; relating to correspondence study
programs; and"
Page 1, following line 2:
Insert new bill sections to read:
"* Section 1. AS 14.03.080 is amended by adding a new
subsection to read:
(g) A child of school age who does not reside in the
state is entitled to attend public school under this
section through a district or statewide correspondence
study program if the child
(1) is a dependent of a member of the armed forces of
the United States, the Alaska National Guard, the
Alaska Naval Militia, or the Alaska State Defense
Force who is
(A) a state resident as defined in AS 43.23.295; and
(B) transferred or pending transfer to a military
installation outside the district while on active
military duty under an official military order; and
(2) was a resident of a school district immediately
before the transfer under (1)(B) of this section.
* Sec. 2. AS 14.17.500 is amended by adding a new
subsection to read:
(d) A child who is attending public school through a
correspondence study program as provided in AS
14.03.080(g) may be counted as a student for the
purpose of calculating the ADM of the correspondence
program.
*Sec. 3. AS 14.17.600 is amended by adding a new
subsection to read:
(c) A child who is attending public school through a
correspondence study program as provided in AS
14.03.080(g) may be included in the report required
under (a) of this section for the purpose of
calculating the ADM of the correspondence study
program."
Page 1, line 3:
Delete "Section 1"
Insert "Sec. 4"
Renumber the following bill sections accordingly.
Co-Chair Merrick OBJECTED for discussion.
Representative Thompson reviewed the amendment, which added
a new subsection to AS 14.03.080. The new subsection
allowed a student who did not reside in-state to continue
to attend public schools through a district or statewide
study program as long as the student was a member of the
armed forces of the United States, the Alaska National
Guard, the Alaska Naval Militia, or the Alaska State
Defense Force. He elaborated that the student's parents had
to be state residents as defined in the Permanent Fund
Dividend statutes. Additionally, parents had to be
transferred or pending transfer to a military installation
outside the district while on active military duty under an
official military order.
Representative Thompson continued to explain the amendment,
which would change AS 14.17.500 related to student count
estimate. Under the statute, districts provided their
projected student count for the succeeding fiscal year, due
th
on November 5 each year. The numbers were used by the
Department of Education and Early Development (DEED) for
budgeting purposes only. He relayed that if a district
anticipated having a child that fell under the provision,
the district should include the student in its projected
average daily membership count. The amendment changed AS
14.17.600 under Section 3 related to the student count
period. Districts provided their actual student count for
the 20-day period in October; the numbers were due to DEED
within two weeks of the end of the count period. If the
district had a child who fell under AS 14.03.080(g), the
district should include the student in its actual average
daily membership count. He noted that adoption of the
amendment would require a title change resolution. He
explained the topic had been brought to his office by a
military family that wanted to remain with the school
district it had been remotely using. He noted that if a
family qualified for the PFD, they were required to say
they were moving back to Alaska.
2:36:56 PM
Representative Josephson thanked the sponsor for the
amendment. He considered the PFD and the requirement that a
person intended to return [to Alaska]. He did not see the
requirement included in the amendment. He thought it meant
the allowance could be indefinite such that the state was
paying for a Florida child's education for 11 years if they
left the state in the first grade. He asked if it was
possible.
Representative Thompson responded that the child would have
to qualify for the PFD. He stated that if he recalled
accurately, even military members that tried to continue to
qualify for the PFD had to return to the state every two
years. He was not certain about the details of the
requirement.
2:38:12 PM
Representative Wool looked at Section 2 in the amendment
related to a child attending a public school through a
correspondence study program who may be counted for the
purpose of calculating the average daily membership of the
correspondence program. He believed it was the way they
calculated the district formula. He provided an example of
students registered for a correspondence program in Galena.
He stated that Galena would count the students in its
average daily membership. He thought it was already
happening and did not understand what the change proposed
in the amendment meant.
Co-Chair Merrick listed individuals online for questions.
Representative Edgmon suggested hearing from the bill
sponsor first. He remarked that the amendment was
multidimensional, and he did not understand it in some
ways.
Co-Chair Merrick would go to the departments first and then
the bill sponsor.
2:40:11 PM
SONDRA MEREDITH, ADMINISTRATOR, TEACHER EDUCATION AND
CERTIFICATION, DEPARTMENT OF EDUCATION AND EARLY
DEVELOPMENT (via teleconference), deferred to a colleague.
DEBORAH RIDDLE, OPERATIONS MANAGER, DEPARTMENT OF EDUCATION
AND EARLY DEVELOPMENT (via teleconference), asked
Representative Wool to restate his question.
Representative Wool restated his question. He asked if the
Section 2, subsection (d), lines 21 through 23 made any
changes to existing statute. He asked for verification that
currently a child in a correspondence program was counted
in the district where the program was housed.
Ms. Riddle indicated he was correct.
Representative Wool asked if the amendment was creating new
law or whether it was already in statute. He did not
understand what the amendment did.
Ms. Riddle responded that currently it was in statute for
in-state students.
Representative Wool asked for verification that the
amendment only pertained to students who were out-of-state
taking correspondence because either they had just left
Alaska or were about to come to Alaska.
2:42:29 PM
Representative Thompson offered to have his staff explain
the amendment further.
SENATOR GARY STEVENS, SPONSOR, highlighted the teacher
shortage in Alaska. He remarked that the bill helped solve
the problem. He stated that the bill did not lower
standards and cut red tape to allow teachers in good
standing from other states to come to Alaska and quickly
become certificated to teach in the school system. He
relayed the bill was supported by school districts. He
emphasized the amendment had nothing to do with the bill.
He stated the legislation was simple and he asked the
committee to avoid messing it up with the amendment.
Representative Thompson reiterated the intent of his
amendment.
Co-Chair Merrick MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Thompson, Carpenter, LeBon, Rasmussen
OPPOSED: Ortiz, Edgmon, Josephson, Wool, Merrick, Foster
Representative Johnson was absent from the vote.
The MOTION to adopt Amendment 1 FAILED (4/6).
2:45:55 PM
Representative Carpenter remarked that Section 3 of the
bill deleted the requirement to pass a competency
examination and inserted the words "complete education
requirements under" two new statutes AS 14.20.20 (h) and
(k) within 90 days. He stated the statutes were provided in
Sections 6 and 7. He detailed that Section 6 dealt with
multicultural education and cross cultural communications
and subsection (k) pertained to alcohol and drug related
disabilities (i.e., students with learning disabilities),
suicide prevention, and dating violence. He asked what was
currently in the competency exam that would no longer be
covered without the competency exam.
Senator Stevens indicated that the goal was to get the
teachers into the system as quickly as possible, not to
eliminate any of the responsibilities such as taking
suicide prevention classes and Alaska history and cultural
studies. He relayed that the teachers had to pass all of
the items over time. He asked his staff to provide further
detail.
2:47:49 PM
TIM LAMKIN, STAFF, SENATOR GARY STEVENS, reminded committee
members the bill was a direct result of emergency
regulations that had been written and adopted by the
current administration in the context of COVID-19. He
expounded it had successfully resulted in getting teachers
in classrooms more quickly during the epidemic. He
explained the statute in the bill was crafted in alignment
with the regulations to create efficiencies. For example,
it was presumed the individuals had taken a competency exam
when they had obtained their regular certification in
another state. The legislation maintained requirements for
courses on sexual abuse awareness, alcohol and suicide
prevention, and cultural awareness, but provided more time
for teachers to complete them.
Representative Carpenter appreciated the need to address
getting teachers into the state. He noted there was other
legislation in the building that was trying to address a
reading deficiency problem. He had been informed that there
were baccalaureate degree programs that did not actually
teach teachers how to teach kids how to read. He had been
told there were teachers employed in Alaska who did not
know how to teach kids how to read. He remarked that the
legislation would eliminate the competency exam requirement
and trust that a teacher from another state knew how to
teach Alaska's kids how to read. He asked if the competency
examination tested or confirmed that a teacher knew how to
teach kids how to read. He asked how Alaska would assess
whether a teacher from another state knew how to teach kids
to read.
Senator Stevens responded that the bill was about teachers
being hired by a district. He remarked that the legislature
was not involved in the hiring process. He stated that
school districts would not hire someone who was
incompetent.
Mr. Lamkin aligned himself with the senator's comments. He
stated it had been a concern voiced through the committee
process. There were stringent processes individuals had to
go through in order to get an Alaska certification. He
stated the bill was an effort to try to make it less
burdensome but not eliminate something such as a competency
exam. He deferred to Ms. Meredith as the person who made
the approvals.
2:51:28 PM
Ms. Meredith asked for Representative Carpenter to restate
his question.
Representative Carpenter restated his question.
Ms. Meredith responded that she administered teacher
certification for the state. She stated the competency exam
was a basic test related to reading, writing, and math and
most states had an exam as part of their licensure
requirements. The bill would remove the requirement for
teachers to provide the documentation within a year. In
terms of a teacher's ability to teach reading, there was
not a specific test. There were currently proposals in
other legislation to include the concept as a requirement.
The other types of exams taken by teachers were content
specific. Presently, an elementary teacher would have to
take a broader test that would test the person's ability to
teach all content areas. She noted the requirements were
currently regulatory, not statutory.
Representative Carpenter asked if the broad array of
assessments would change under the bill.
Ms. Meredith responded that the basic competency exam
requirement was the only exam that would be removed by the
legislation. She noted the additional regulatory
requirements for content area exams.
Vice-Chair Ortiz stated as a former principal he could
relate to the initial answer by the bill sponsor. He stated
that the process of determining a teacher's ability to
teach reading would not be covered in an objective exam. He
detailed the responsibility resided with the hiring
district, the principal, and hiring committee. He continued
that hopefully there was a thorough process through letters
of recommendation and other methods to assess a teacher's
ability to teach reading rather than relying on a specific
exam.
2:57:02 PM
Representative Carpenter begged to differ. He stated that
one of the other bills the committee had seen included
phonics and phonetic reasoning. He stated the concepts were
taught in some but not all schools. He thought a multiple
choice test could be devised to test an individual's
knowledge on the areas. He did not think removing the
competency examination was in the best interest of Alaskan
students.
Vice-Chair Ortiz believed the other bill working its way
through the body was about an assessment of an incoming
primary age student and where their ability was in
recognition of basic reading skills. He explained it was a
measurement of a student's reading readiness or their
ability to read by the third grade. He stated it was a
different thing than having a teacher apply to a district.
He stated the ability to teach kids to read was the
question; the question was not about having the skills to
be a reader.
2:59:16 PM
Representative Josephson asked how many people who took the
competency exam did not pass.
Ms. Meredith estimated there was a 3 percent to 5 percent
failure rate for the competency exam. There were others
that had been adopted and abilities for an educator to
retake the test. She noted it was often very difficult,
particularly in rural communities, for the retakes to take
place. She stated individuals often had to fly at their
expense to retake the test.
Vice-Chair Ortiz asked about the practice Ms. Meredith had
mentioned. He assumed it did not relate to teaching reading
itself to primary age students. He noted Ms. Meredith had
spoken previously about content such as basic math,
science, history, and other. He wondered if the exam tested
a teacher's ability to teach reading.
Ms. Meredith reported that the basic competency exam did
not look at a person's ability to teach reading or the
knowledge behind the science of reading. The exam tested
reading comprehension.
3:02:16 PM
Representative Johnson noted Alaska was 49th in the nation
for its education system. She remarked on the state's
teacher shortage. Her biggest concern was not people who
were qualified to teach in Alaska. Her bigger concern was
about the unique conditions teachers may encounter in
Alaska, especially in rural areas. She highlighted the
point of the legislation was to expand the state's teacher
base. She remarked that many times teachers from out-of-
state were often already in Alaska because they were
married to a military member stationed in the state.
Co-Chair Merrick acknowledged Representative Mike Cronk in
the room.
Senator Stevens agreed with the statements made by
Representative Johnson. He explained the purpose of the
bill was workforce development. The bill aimed to cut the
red tape and get certificated teachers who were successful
in other districts to have the ability to apply for
teaching jobs in Alaska. He recalled past testimony from a
superintendent of the Anchorage School District that 7
percent of the district were military spouses. He remarked
that sometimes military members were only in Alaska for two
to three years and if a person had to wait a year to get
accepted into the education system, a year had been lost.
He added there were also other teachers who wanted to teach
in Alaska who were certificated in other states.
3:04:52 PM
Representative Carpenter appreciated that Alaska needed
more teachers; however, he emphasized that Alaska did not
need more teachers who fit into the 3 to 5 percent practice
test failure rate. He surmised they would just assume the
situation would no longer occur. He remarked that the bill
would no longer require the competency exam. He suggested
that it was a concept that businesses and military
organizations had when they had a recruiting problem. The
question was whether standards should be lowered to fill
positions. He asked how the bill sponsor knew the
legislation would not lower standards. He emphasized they
would not know because they were not asking.
Mr. Lamkin clarified Section 2 of the bill. He explained
the target population of the bill was teachers with years
of experience. The teachers held a baccalaureate degree and
currently held a legitimate teaching certificate in another
state. He highlighted that other state's certification
processes always included a competency of some kind. The
bill recognized that teachers had completed the test
previously; therefore, they would not have to take it again
to teach in Alaska. It was an expensive and onerous test
and sometimes relied on spotty internet in rural Alaska.
Ms. Meredith concurred with Mr. Lamkin. The cases that she
saw with difficulty often involved teachers in the rural
areas in Alaska. She remarked that individuals ended up
being successful, but it was a laborious process.
3:08:06 PM
Representative Carpenter wondered if he had just heard that
teachers with years of experience had to take the
competency exams multiple times.
Ms. Meredith agreed that teachers had to take a competency
exam. She explained they may have passed one of the exams
in the past but due to various aspects of the testing
companies they were unable to bring the exams forward to
DEED, meaning they had to take another exam that was
sometimes very difficult to pass.
Representative Carpenter disagreed with removing the
requirement for a competency exam that experienced teachers
had a challenge passing. He stated it reduced the state's
standards.
Vice-Chair Ortiz appreciated Representative Carpenter's
concerns. He understood that everyone had a concern of not
lowering the bar in relationship to the community of
teachers in Alaska. He referenced the portion of the bill
that enabled incoming teachers to not immediately take the
competency exam. He emphasized the exam did not measure the
competency to teach. He detailed the test measured content
about a person's knowledge of history or math. He stated he
could have all kinds of knowledge about history but that
did not mean he could teach it. He stated the
responsibility resided with the local district, hiring
committees, and principal to look at the applicant, their
letters of reference and years of experience to determine
whether the person was in the best interest of meeting the
kids' needs in the classroom.
Vice-Chair Ortiz believed an individual would not be hired
if the district did not think they would provide good
education to the students. He considered it may be further
complicated due to the shortage of teacher applicants and
districts may have to be more accepting of applicants than
they may have been in the past; however, the competency
exam would not change the situation.
3:11:52 PM
Representative Wool appreciated the conversation and the
need to get teachers in schools. He highlighted that
Fairbanks was in desperate need for substitute teachers. He
believed on any given day there were hundreds of substitute
teachers teaching kids. He stated he knew of kids who had
substitute teachers for weeks who were not teachers and
were not required to have a degree. He asked how many
substitute teachers were teaching Alaskan children on any
given day.
Ms. Riddle replied that he did not have the information on
hand but could get back to the committee.
Representative Carpenter thought the committee was placing
significant trust in teachers from out-of-state if it was
not requiring a competency exam.
Senator Stevens reminded members the purpose of the bill
was to fill a shortage with competent teachers by hiring
certificated teachers from out-of-state. He remarked that
the bill did not mean that every certificated teacher who
wanted a job in Alaska would be hired. He shared he had
been on school boards for many years, and he knew the
districts were very careful to hire the proper teachers. He
added that 7 percent of the teachers in Anchorage were
military spouses. He stated that without the bill the state
would lose years of experience in the classroom. The bill
did not solve all of the problems, but it did help.
3:15:41 PM
AT EASE
3:16:32 PM
RECONVENED
Co-Chair Foster MOVED to report CSSB 20(FIN) out of
Committee with individual recommendations and the
accompanying fiscal notes.
Representative Carpenter OBJECTED.
A roll call vote was taken on the motion.
IN FAVOR: Rasmussen, Thompson, Wool, Johnson, Josephson,
LeBon, Ortiz, Foster, Merrick
OPPOSED: Carpenter
Representative Edgmon was absent from the vote.
The MOTION PASSED (9/1).
CSSB 20(FIN) was REPORTED out of committee with five "do
pass" recommendations, one "do not pass" recommendation,
three "no recommendation" recommendations, and one "amend"
recommendation and with one previously published fiscal
impact note: FN3 (EED).
3:17:50 PM
AT EASE
3:19:10 PM
RECONVENED
CS FOR SENATE BILL NO. 243(FIN)
"An Act relating to the power cost equalization
endowment fund; relating to power cost equalization;
and providing for an effective date."
3:19:25 PM
Co-Chair Merrick indicated the bill had last been heard on
May 9.
3:19:39 PM
Representative Thompson MOVED to ADOPT Amendment 1, 32-
LS1573\I.1, (Nauman/Klein, 5/7/22)(copy on file):
Page 2, following line 6:
Insert a new bill section to read:
"* Sec. 2. AS 42.45.085(d) is amended to read:
(d) If the earnings of the fund for the previous
closed fiscal year, as calculated under AS
42.45.080(c)(2), exceed the appropriation under (a) of
this section for the current fiscal year, the
legislature may appropriate 70 percent of the
difference between the earnings of the fund for the
previous closed fiscal year, as calculated under AS
42.45.080(c)(2), and the appropriation made under (a)
of this section for the current fiscal year as
follows:
(1) if the amount calculated under this subsection is
less than $30,000,000, that amount to a community
revenue sharing or community assistance
fund; or more,
(2) if the amount calculated under this subsection is
$30,000,000 or
(A) $30,000,000 to a community revenue sharing or
community assistance fund; and
(B) the remaining amount, not to exceed $25,000,000,
to the renewable energy grant fund established under
AS 42.45.045, to the bulk fuel revolving loan fund
established under AS 42.45.250, [OR] for rural power
system upgrades, for bulk fuel upgrades, or to a
combination of the funds or purposes listed in this
subparagraph."
Renumber the following bill sections accordingly.
Co-Chair Merrick OBJECTED for discussion.
Representative Thompson explained that the amendment added
bulk fuel upgrades to a list of types of projects that AS
42.45.085(d) may fund. The list currently included the
renewable energy fund, the bulk fuel revolving loan fund,
and rural power system upgrades. He stated that adding bulk
fuel upgrades to the list allowed the Alaska Energy
Authority (AEA) to capture federal funds on a one-to-one
basis if it undertook any bulk fuel upgrades. He invited
Mr. Thayer to comment.
3:20:30 PM
CURTIS THAYER, EXECUTIVE DIRECTOR, ALASKA ENERGY AUTHORITY,
DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT
(via teleconference), elaborated on the amendment. He
explained there was a cascading waterfall of funds
available depending on when the fund reached a certain
level of earnings. He elaborated that the first $30 million
or so would go to the Power Cost Equalization (PCE)
payments, the next $30 million would go to the community
assistance program, and up to $25 million could be used
into the three programs mentioned by Representative
Thompson (renewable energy fund, the bulk fuel revolving
loan fund, and power houses). He explained that the
amendment added bulk fuel as one of the choices. For
example, power houses had been included for $10 million in
the current year, which had received a $10 million match.
He expounded that if bulk fuel had been included in the
category, AEA could put any available dollar amount into
bulk fuel and receive a federal match one for one.
Mr. Thayer relayed there was currently $300 million in
deferred maintenance on power houses and $800 million
deferred maintenance in bulk fuel. He explained the
amendment would be another mechanism to help with deferred
maintenance if the earnings of the endowments supported the
cascades.
3:22:35 PM
Co-Chair Foster asked to hear from the bill sponsor or his
staff on the amendment.
TIM GRUSSENDORF, STAFF, SENATOR LYMAN HOFFMANN, stated that
the Senate Finance Committee would prefer no amendments. He
relayed there were already three competing entities for the
$25 million if the cascades got to that point. The fourth
entity would compete with the first three. He noted that
the legislature selected where the $25 million would go and
could split the funds how they chose. He believed when the
renewable energy source had been added, there was an effort
to move away from fossil fuels and work towards renewable
energy sources. He suggested that the legislature could
provide a separate appropriation for bulk fuel. He remarked
the match for bulk fuel would not be consistent because of
market fluctuations.
3:24:32 PM
Representative Josephson asked what a bulk fuel upgrade
looked like.
Mr. Thayer deferred the question to a colleague.
TIM SANDSTROM, CHIEF OPERATING OFFICER, ALASKA ENERGY
AUTHORITY (via teleconference), responded that a typical
rural bulk fuel system consisted of vertical or horizontal
tanks with secondary containment built into the tank system
and sometimes as a dike around the system. There were
approximately 400 rural facilities, several in each
community that were owned by school districts, Native
corporations, or other entities. He explained the
facilities were in a continued state of disrepair with
approximately $800 million in deferred maintenance. The
tanks often had a great deal of corrosion and sometimes the
secondary containment was compromised, which was the type
of project the possible funding would meet.
Representative Josephson asked for verification there was
currently $800 million in need for the tanks.
Mr. Sandstrom responded affirmatively.
Representative Josephson saw the environmental benefit;
however, he would be concerned that when a legislator
offered an undesignated general fund (UGF) amendment on
bulk fuel that a counter argument would be the amendment
was unnecessary because bulk fuel could participate in
specific program (as proposed in Amendment 1). He remarked
that the funds were merely incremental whereas an $800
million problem existed. He did not see the amendment as a
great way to get there.
3:27:05 PM
Representative Wool remarked that he believed the proposed
addition would be competing with renewable energy fund
dollars. He thought the goal should be to replace diesel
fuel demand with other energy sources sooner rather than
later. He thought $800 million [in deferred maintenance]
was a significant amount of money. He would be opposing the
amendment. He thought UGF may be a better approach.
Vice-Chair Ortiz asked for the name of the three entities
currently competing for the funding.
Mr. Grussendorf responded that the three entities included
the bulk fuel revolving loan fund, the rural power systems
upgrade, and the renewable energy fund.
3:28:45 PM
Representative Carpenter asked how many individual tanks
the $800 million price tag represented.
Mr. Sandstorm responded that there were 400 facilities,
which typically had between two and ten bulk fuel tanks
comprising a system.
Representative Carpenter asked if any of the tanks had
regulatory inspection requirements that resulted in
required system upgrades.
Mr. Sandstrom answered affirmatively. He detailed there
were two primary regulatory bodies responsible for tank
inspections including the U.S. Coast Guard and the
Department of Environmental Conservation. He highlighted
the concern that the regulatory agencies had not been very
active in enforcing and doing monetary finds in the past;
however, they were beginning to do so as of the current
year. One of AEA's primary efforts was to mitigate the
effects and keep the facilities co-compliant and safe.
Representative Carpenter asked how many facilities were
currently known to be out of compliance.
Mr. Sandstrom responded that AEA was currently undertaking
an inventory assessment that was anticipated to be complete
by the end of the year. Anecdotally about 75 percent of the
facilities had some regulatory violations of varying
significance.
Representative Carpenter asked if there were any facilities
with leaks needing immediate repairs.
Mr. Sandstrom replied there were none at the current time.
3:31:05 PM
Representative Thompson noted that earlier in the year
there had been an effort to remove the $25 million cap
related to available funds; however, the effort had not
been successful. He commented that many of the small
communities had old degrading tanks. He stated it had been
the purpose of the proposed amendment. He could see the
amendment was taking up a significant amount of the
committee's time.
Representative Thompson WITHDREW Amendment 1.
Representative Wool stated he had an amendment that he did
not offer which was to lower the amount from 750kWh to
650kWh. He wanted to have a discussion about the topic. He
believed there was scarcity of data in terms of what people
were using. He was amenable to the increase. He had written
to a couple of utilities including one in Fairbanks and
Mat-Su Electric. The monthly consumption average by a home
in Fairbanks was 568kWh per month and the average in Mat-Su
was around 604kWh. He had not seen any data on PCE
communities. He spoke about increased costs. He considered
whether some homes would even need the increase. He
believed some people could expand their consumption through
space heaters, especially if diesel costs were high. He
spoke about the desire for energy efficiency to heat homes.
He suggested heat pumps could be used in some areas. He
would like to see more data on consumption and need from
AEA.
3:35:28 PM
Co-Chair Foster MOVED to report CSSB 243(FIN) out of
Committee with individual recommendations and the
accompanying fiscal note
There being NO OBJECTION, it was so ordered.
CSSB 243(FIN) was REPORTED out of committee with five "do
pass" recommendations and five "no recommendation"
recommendations and with one previously published fiscal
impact note: FN1 (CED).
Co-Chair Merrick reviewed the meeting schedule for the
following day.
ADJOURNMENT
3:36:05 PM
The meeting was adjourned at 3:36 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 131 Public Testimony Rec'd by 051222.pdf |
HFIN 5/13/2022 1:30:00 PM |
SB 131 |
| SB 243 Amendment 1 Thompson 051322.pdf |
HFIN 5/13/2022 1:30:00 PM |
SB 243 |
| SB 20 Amendment 1 Thompson w Legal Memo 051322.pdf |
HFIN 5/13/2022 1:30:00 PM |
SB 20 |
| SB 131 Amendment Pkt 051322.pdf |
HFIN 5/13/2022 1:30:00 PM |
SB 131 |
| SB 20 DEED Response 20220516 - Count of longterm subs by district and state.pdf |
HFIN 5/13/2022 1:30:00 PM |
SB 20 |
| SB 20 5.13.2022 (H) FIN Hearing SB20 DEED Follow-Up.pdf |
HFIN 5/13/2022 1:30:00 PM |
SB 20 |