Legislature(2023 - 2024)ADAMS 519
02/17/2023 01:30 PM House FINANCE
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| Overview: Governor's Budget Amendments | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
February 17, 2023
1:31 p.m.
1:31:39 PM
CALL TO ORDER
Co-Chair Johnson called the House Finance Committee meeting
to order at 1:31 p.m.
MEMBERS PRESENT
Representative Bryce Edgmon, Co-Chair
Representative DeLena Johnson, Co-Chair
Representative Mike Cronk
Representative Alyse Galvin
Representative Sara Hannan
Representative Andy Josephson
Representative Dan Ortiz
Representative Frank Tomaszewski
Representative Julie Coulombe (via teleconference)
MEMBERS ABSENT
Representative Will Stapp
Representative Neal Foster, Co-Chair
ALSO PRESENT
Neil Steininger, Director, Office of Management and Budget,
Office of the Governor.
PRESENT VIA TELECONFERENCE
Josephine Stern, Assistant Commissioner, Department of
Health; Alesia Kruckenberg, Director of Strategy Planning
and Budget, University of Alaska; Teri West, Administrative
Services Director, Department of Corrections; Cheri
Lowenstein, Administrative Services Director, Office of the
Governor; Amber LeBlanc, Administrative Services Director,
Department of Law.
SUMMARY
OVERVIEW: GOVERNOR'S BUDGET AMENDMENTS
1:31:43 PM
Co-Chair Johnson reviewed the meeting agenda.
^OVERVIEW: GOVERNOR'S BUDGET AMENDMENTS
1:32:52 PM
NEIL STEININGER, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, introduced himself and a PowerPoint
presentation entitled, "Amended Budget HB39, HB40, HB41 and
HB54," dated February 17, 2023 (copy on file). He began on
slide 2 and offered an overview of the FY 24 amended
budget. He explained that the budget was released on
December 15 every year and the governor had the opportunity
to introduce amendments on the thirtieth day of legislative
session. The amendments generally covered topics that were
either not contemplated at the time the budget was
developed, emergent issues that were not problems at the
time of the original release of the budget, or corrected
any errors or mistakes that may have been made. He noted
that there was just under $9.2 million requested in the FY
23 supplemental budget and $106.3 million to the FY 24
budget in unrestricted general funds (UGF). When all fund
types were added together, the total for FY 23 was a
deficit of $43.9 million and a surplus of $489 million in
the FY 24 budget.
Co-Chair Johnson announced that Co-Chair Edgmon had joined
the meeting.
Mr. Steininger continued on slide 3. He indicated that when
the amendments were added to the December budget, the total
was $7.8 billion in UGF in FY 23 and about $7.4 billion in
FY 24. The addition of the amendments in FY 23 effectively
brought the K-12 forward funding deposit down to zero. In
FY 24, the amendments brought the deficits projected in the
December 2022 revenue forecast to $433.5 million.
Mr. Steininger continued on slide 4. One of the most
significant issues that had emerged since the release of
the budget in December was the amount of backlog incurred
during the COVID-19 pandemic within the Office of Public
Advocacy (OPA) and the Public Defender Agency (PDA). There
was an addition of about $1.6 million in the FY 23
supplemental budget and $6.7 million in the FY 24 budget
for OPA and PDA in order to help with the backlog. The
total additions were $4.7 million in FY 23 and $9.8 million
in FY 24 in increased investments for the two entities. For
OPA, the money would primarily go to a contractor rate and
cap increase. He relayed that the rates had not been
adjusted in some time. There was a bill in the prior
session that increased pay by 20 percent for attorneys, and
the amended budget increase would provide the same increase
for contracted attorneys. They also increased a cap in the
number of hours that contracted attorneys were able to bill
because the number of hours it typically took to defend a
felony case was significantly greater that the number
allowed by the cap. In PDA, there was an addition of one-
time funding to bring in contractors to assist with the
backlog, additional funding for training to improve
recruitment and retention, and increased funding for the
agency's most serious felony caseloads.
1:38:49 PM
Mr. Steininger advanced to slide 5 and reported that the
second largest issue was occurring within the Department of
Health (DOH) and the Division of Public Assistance (DPA).
There was a significant backlog in Supplemental Nutrition
Assistance Program (SNAP) payments as well as the looming
issue of Medicaid eligibly redetermination. There were a
number of items within the FY 23 and FY 24 supplemental
budgets to address the issues. In FY 23, there was about $3
million in federal funds related specifically to the
backlog application processing. In 2024, there was a
similar increase in funding for DPA to support the backlog.
In total, there was an increase of about $9 million in UGF
and $9 million in federal funding. There was also a
replacement of the eligibility system, which was a project
that had been going on for about a decade. The
appropriation in the FY 23 and FY 24 supplementals would
fund the final phase of the project and the completion of
the project would allow processing to improve in the
future.
Co-Chair Johnson made note that Representative Coulombe was
online.
Representative Hannan asked for clarification on the last
item under FY 24 on slide 5, which was the mainframe system
replacement. She asked what the system would be replaced
with and wondered if it would be another mainframe system
or a cloud-based system.
Mr. Steininger responded that the plan was to move away
from the mainframe system.
1:41:31 PM
Mr. Steininger moved to the Alaska Marine Highway System
(AMHS) on slide 6. The state received a considerable amount
of federal grants for AMHS for a total of $286 million;
however, the grants required a match. He explained that the
Office of Management and Budget (OMB) met with the
Department of Transportation and Public Facilities (DOT)
and put together a plan to satisfy the match requirements
with the least amount of state funds. Within the operating
side of AMHS, the match requirement was $44 million and DOT
was able to accommodate the match with existing
appropriations within the operating budget. However, the
award of federal receipts for the operating system was less
than the amount of federal receipts appropriated in the
prior year. The supplemental proposed switching some of the
federal receipts to Farebox Recovery Funds in order to
ensure that full operations would continue. It was not
necessarily a required match, but a smaller federal award
than what was anticipated.
Mr. Steininger added that there was a federal award for the
marine vessel (MV) Tustumena, and the match was being
pulled from an existing capital appropriation from FY 18
from the vessel replacement fund (VRF). There was another
$8.6 million grant for design work on another replacement
vessel and there was a capital amendment to draw $2.1
million from the VRF to match the program. The remaining
$163.7 million in capital projects was for the electric
ferry, dock infrastructure upgrades, and existing vessel
modernization. The match for the $163.7 million was coming
from a concept called toll match credit, which allowed for
the capture of other federal dollars to be used for the
program by using credits from toll receipts. Using prior
year expenditures of the funds to the maintenance of the
vessels had a credit towards using federal funds in the
current year to match other federal funds. He noted that
the toll receipts strategy was a new tool for the state and
the state was working with its federal partners to ensure
that the system was properly understood. He had provided a
handout to the committee to explain the concept in depth.
1:44:58 PM
Representative Ortiz asked about the first item on slide 6
that indicated there was a grant of $44 million for
operations. He recalled that Mr. Steininger had said that
there was a source for the required $18.4 million match and
inquired as to the origin of the source.
Mr. Steininger responded that the $18.4 million match would
be coming from the AMHS fund, or the toll box recovery
fund. There were several fund sources within the broader
operating budget for marine highways: the $18.4 million
match, the federal receipts from the operations grant, a
general fund appropriation in the budget for the current
fiscal year, and a contingency appropriation that would
appropriate $20 million of additional general funds if the
federal receipts came in lower than what was appropriated.
The only new appropriation was the $18.4 million match.
Mr. Steininger concluded his presentation and explained
that there was a spreadsheet packet of other amendments he
would explain for the committee.
Representative Ortiz referred to slide 3 and asked if the
supplemental was eliminating the surplus that was intended
for forward funding education. He understood that the $1.2
billion that was thought to be available for education was
now unavailable because of reduced revenue. He asked if
there was a deficit in the FY 23 budget.
Mr. Steininger responded that the state was effectively
exactly balanced for the current revenue projections.
Representative Ortiz thought the deficit was around $300
million prior to the amendments, and with the amendments
the deficit was around $433 million.
Mr. Steininger responded in the affirmative.
Co-Chair Edgmon commented that the original deficit was
specifically $322 million.
1:49:21 PM
Representative Josephson referred to slide 5 and the DPA
increase. He asked if the increase would allow for 30 more
personnel within the division.
Mr. Steininger responded that there were 30 non-permanent
positions associated with the increase.
Representative Josephson asked if the 30 new personnel were
in addition to the increase of 20 positions as of December
15, 2022.
Mr. Steininger responded in the affirmative.
Representative Galvin understood that there was an addition
of $9 million for the 30 new positions. She calculated that
each position would cost $300,000.
Mr. Steininger responded that there was an increase of $9
million in state dollars and $9 million in federal dollars
for more than the non-permanent personnel. The funds would
cover other aspects as well, such as bringing on
contractors to work at call centers.
Representative Hannan noted that Mr. Steininger had used
the term "clearing the backlog" but that it was for FY 24
and would not be available for use until July 1 of 2023.
She had been led to believe that the backlog should be
taken care of prior to July.
Mr. Steininger responded that the FY 24 amount was in
addition to the FY 23 supplemental. He clarified that the
intention was not to wait until July to begin addressing
the backlog. The FY 23 supplemental represented the costs
for the remainder of the year. He explained that the need
for a surge in capacity began in FY 23 through FY 24 and
into FY 25. Part of the increase was related to the
Medicaid redetermination, which was a rolling cycle of
redetermination and could not necessarily happen all at
once.
Representative Hannan was concerned that there was $3
million to clear up the backlog, however it was anticipated
that $18 million would be needed in the next fiscal year to
keep up with the backlog. She asked why the amount was only
$3 million and why not add another $10 million.
Mr. Steininger responded that slide 5 showed what work
could be accomplished from now until the end of the fiscal
year. If the entire amount was put into FY 23, the
department would not necessarily be able to execute the
required work. The FY 24 amount represented efforts to
ensure the surging capacity continued to be funded. He
noted that it was likely that the surging capacity would
need to continue into FY 25.
Representative Josephson asked if the 30 additional
personnel would be fundable with the FY 23 supplemental. He
asked if it would cover the 30 new positions in addition to
the 20 positions budgeted as of December 2022. He wondered
if someone asked him how many people were working on the
crisis whether it would be correct to report that about 50
people would be working on it.
Mr. Steininger replied that everyone at DPA was working on
the crisis. He deferred the question to a representative
from DOH.
1:55:29 PM
JOSEPHINE STERN, ASSISTANT COMMISSIONER, DEPARTMENT OF
HEALTH, JUNEAU (via teleconference), responded that the 30
positions were being added as part of the FY 23
supplemental request and would carry forward into FY 24.
Co-Chair Johnson asked how hiring more people would
increase the capacity.
Mr. Steininger responded that a portion of the funding
would go to contractual costs. He suggested that Ms. Stern
might be able to speak to the strategies deployed by the
department.
Ms. Stern responded that the department was exploring an
agreement that would allow for increased compensation for
the workers for the overtime hours spent working on the
backlog. The department was receiving increased numbers of
applicants and there had been successes.
Representative Galvin asked if the success transferred to a
success in distributing what needed to be distributed for
federal funds and federal services.
Ms. Stern responded that it was the hope that the backlog
would be cleared with the help of the incoming personnel.
1:58:00 PM
Mr. Steininger directed the committee's attention to the
document titled, "FY 23 Supp Op Gov Amend spreadsheet"
(copy on file). The first item on the spreadsheet was one
he had already discussed with OPA. The second and third
items were associated with an adjustment for a recently
negotiated unit contract with the Teachers Association of
Mt. Edgecumbe (TEAME). Items four through six were related
to the previously discussed Medicaid eligibility issue.
Item seven was an adjustment in general funds as the
Department of Military and Veterans Affairs (DMVA) had
found that some costs supported by general funds could
instead be supported by a federal award, and therefore DMVA
could reduce its general fund appropriation. Item eight was
the estimate needed for spring wildfires to date. Item nine
was the amount necessary to complete payments for summer
and fall 2022 fire activity. Item 10 was a reduction of
$150,000 related to a cash room in Juneau for the
Department of Revenue (DOR). He explained that the
department found a different way to accomplish the same
need and the appropriation was no longer required.
Mr. Steininger moved to page 2 of the document. He
explained that item 11 was a technical reversal of an
appropriation in federal receipts for the Alaska Housing
Finance Corporation (AHFC). Item 12 was a fund source
change shifting between two other fund sources as an
incorrect fund source was mistakenly included in the FY 23
budget. Item 13 was the previously discussed $18.3 million
match related to AMHS.
Mr. Steininger advanced to page 3. Item 17 was related to
legal and advocacy service for the Public Defender Agency.
Item 18 was a ratification of a [Medicaid] expenditure from
FY 16 in which a federal award came in lower than the
amount that had initially been billed to the federal
government. Item 19 was the other half of the technical
correction relating to AHFC.
Mr. Steininger directed attention to the next spreadsheet,
titled "FY 23 Supplemental Capital Governor Amended" (copy
on file).
2:02:50 PM
Representative Galvin referred to item 4 on the first page
of "FY 23 Supp Op Gov Amend spreadsheet." There were many
different ways the funds would be used to ensure that the
necessary work was being done regarding the public
assistance program. In light of the last few months, she
wondered whether there were also funds available for
emergencies if the state was unable to deliver the
necessary changes to the SNAP benefits. She asked if there
was an available fund for emergencies.
Mr. Steininger asked if the question was if there was money
available to provide some other form of relief directly to
the beneficiaries.
Representative Galvin responded in the affirmative and
asked if the state was unable to deliver the necessary
changes to the program.
Mr. Steininger responded that the available funds only
covered the resources necessary to do the eligibility
determination work. There was not any supplemental money to
a state funded program for food relief.
Representative Galvin noted that the spreadsheet referenced
contractual support, communication needs, temporary
staffing and security. She asked if the listed components
were strictly intended to support eligibility
determinations.
Mr. Steininger responded that Representative Galvin was
correct and the appropriation was specifically related to
the eligibility determination issue. He relayed that OMB
had been working with DOH and other departments that had
connections to food security to determine if there were any
existing appropriations that could help address the issue.
He emphasized that during the last several days, OMB had
been working specifically to identify a way to address the
need.
2:05:56 PM
Mr. Steininger drew attention to the next handout,
entitled, "FY2023 Supp Capital Gov Amend" (copy on file).
There were four items in the supplemental capital budget.
The first item was a scope change. The project related to
DMVA in Fairbanks had prior year appropriations, one of
which was limiting the location at which the appropriation
could be used. The scope change was required in order to
access the money for the project.
Mr. Steininger advanced to item 2, which was $4.3 million
related to the ability to access unanticipated federal
funds in the Airport Improvement Program (AIP). Item 3 was
a reappropriation of capital projects that had been
completed with some money left over. The money was being
reappropriated for the scope of emergency weather and
catastrophic event response at DOT. Item 4 was a reduction
of $64 million in federal receipts at the University of
Alaska (UA).
Representative Hannan asked about the statewide airport
improvement contingency. She asked why the airports were
listed under the Department of Administration (DOA).
Mr. Steininger responded that it was a typo and it should
be listed under DOT.
Representative Josephson asked Mr. Steininger to explain
item 4 in more detail.
Mr. Steininger replied that it referred to a capital
project that had been brought forth in the prior year. The
project was a grant that was pursued but ultimately it did
not come through. It was unnecessary to continue to keep
the project on the books.
Representative Josephson asked what the $94.4 million
figure on the spreadsheet represented. He wondered how it
related to the $64 million figure.
Mr. Steininger responded that he would defer the question
to a representative from the university.
2:09:25 PM
ALESIA KRUCKENBERG, DIRECTOR OF STRATEGY PLANNING AND
BUDGET, UNIVERSITY OF ALASKA (via teleconference),
responded that it was a $94.4 million grant that UAF
[University of Alaska Fairbanks] had applied for but did
not receive. There were still other opportunities for a
reduced amount of federal funding. The university had
requested that the $64 million be taken from the $94.4
million figure to leave a balance for any other awards UAF
might receive.
Representative Josephson responded that his question had
been answered.
2:10:33 PM
Mr. Steininger continued on the next handout, entitled, "FY
24 operating governor amend spreadsheet" (copy on file). He
began with item 1 on the spreadsheet and indicated that it
was similar to a request in the supplemental budget
released at the end of January of 2023. The request was for
$80,000 in program receipt authority for administrative
hearings for increases in cases on behalf of others. Item 2
was a technical adjustment swapping from capital
improvement project receipts to inner agency receipts. It
was a technical adjustment to a fund source in the budget
with no net impact. Item 3 was adding a strategic human
resources consultant to develop a strategic recruitment
plan and assist at a statewide level on the ability to
recruit statewide employees. Items 4 through 8 were already
touched on in an earlier slide and were related to OPA and
PDA. Items 9 through 14 related to salary and benefit
adjustments that were omitted from the Department of
Commerce, Community and Economic Development's (DCCED)
initial budget submission.
Mr. Steininger advanced to page 2. Items 15 through 23 were
also related to the salary and benefits adjustments that
were omitted from DCCED's budget. Item 24 was an additional
12 staff and $1.6 million in professional licensing
receipts to address some of the significant recent workload
increases. Items 25 through 29 were also related to the
salary and benefit adjustments mission.
Mr. Steininger moved to page 3. Items 30 through 41 were
also associated with salary adjustments. Item 42 was a one-
time appropriation of $5 million for the Alaska Seafood
Marketing Institute (ASMI) to assist with efforts in
marketing Alaska seafood and in business development in the
state. Items 43 and 44 were salary and benefit adjustments.
Mr. Steininger moved to page 4. Items 45 through 48 were
the last of the salary and benefit adjustments. Item 49 was
an increase in the Department of Corrections (DOC) and was
included in the supplemental budget as well. It would fund
an investigator responsible for the investigation of crimes
committed by inmates. Item 50 was an increase in federal
authority due to an increase in the federal funds made
available to Department of Education and Early Development
(DEED). Item 51 was moving the Technical and Vocational
Education Program (TVEP) from the numbers section of the
appropriation bill to the language section. There was a
variable amount that paid into the program that would
always come in as an estimate at the start of the year and
had to be adjusted throughout the budget process. If it
were to be moved to the language section, it would ensure
that there would be an "estimated to be" appropriation.
This would allow for the distribution to the grant
recipients of the TVEP program to be adjusted based on
actual collections rather than needing to be reliant on
small supplemental budget adjustments when there was a
change in the revenue into TVEP.
Mr. Steininger continued with item 52, which was a
correction of a transaction type changing it from an
ongoing increment of $20,000 to a one-time increment. Item
54 was the FY 24 portion of the TEAME contract that he had
discussed when detailing the supplemental section. Item 55
was an increase in fees in the program administration and
operations section in postsecondary education related to a
new regulation package. Item 56 was adjusting authority in
the Department of Environmental Conservation (DEC) as
uncollectable authority.
Co-Chair Edgmon referred to item 49. He asked for more
information on $250,000 being added for Alaska State
Troopers (AST) to investigate crimes committed by inmates
who were in custody. He noted that there were 18 inmate
deaths in 2022 and he did not believe any of the deaths
were considered homicides.
Mr. Steininger deferred the question to a representative
from DOC.
2:18:28 PM
TERI WEST, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT OF
CORRECTIONS, JUNEAU (via teleconference), responded that
item 49 was a funding request intended to fund a full-time
trooper to perform investigations but also to prevent
suicides and ensure that there were timely recordings of
the outcomes of the investigations. The intent was also to
establish cooperative efforts to streamline efficiencies
when there were potential inmate felony misdemeanor
criminal cases.
Co-Chair Edgmon appreciated the answer. He found it
interesting because he thought the state was challenged in
its low number of troopers. He understood the rationale but
was processing the fact that $250,000 was spent on
investigating deaths.
Ms. West responded that the position would be for a retired
DPS trooper to support the activity.
Co-Chair Edgmon would save his other question for later.
Representative Tomaszewski asked about item 42, which was
the $5 million appropriation for ASMI. He asked for the
total value of the seafood produced annually in Alaska.
Mr. Steininger responded that he would have to follow up in
writing.
Representative Tomaszewski asked if the $5 million
appropriation was the only appropriation for ASMI.
Mr. Steininger responded that ASMI was primarily funded by
assessments paid in by those engaged in the seafood
industry. The $5 million appropriation was in addition to
the primary funding source. The appropriation intended to
add some state support to an otherwise fully industry-
supported organization.
Representative Tomaszewski asked if the appropriation came
straight from the general fund.
Mr. Steininger responded in the affirmative.
2:22:17 PM
Representative Hannan asked about item 56, which was to
eliminate uncollectible interagency receipt authority. She
asked why the state was uncollectable from its own
agencies.
Mr. Steininger responded that inner agency receipt
authority was generally used when one agency was doing work
on behalf of another. Most of the time it involved granting
authority to the administration to conduct IT work or
accounting work for another department. Sometimes a
department might be working on a project outside of its
expertise and it might need assistance from another
department. For example, DEC might occasionally support a
road project by DOT. The budgets for collaborative efforts
were often an estimate and what DEC found was that the
estimate was higher than the amount of work received and
requested. A department could not collect the revenue
related to a budget that overstated the actual resources
held. Adjusting the budget would clarify the actual
projections of the collections.
Representative Hannan understood that when DEC submitted
the budget, the department estimated that it would have the
responsibility of $200,000 to $300,000 more than other
agencies had been using. She understood that no one was
using the extra funding. She thought the term
"uncollectable" was misleading. She understood that Mr.
Steininger was stating that it was excess authority.
Mr. Steininger responded in the affirmative.
Representative Hannan added that she understood that
vernacular and accounting terms were not the same.
2:25:04 PM
Mr. Steininger moved to page 5 and began on row 57, which
would use federal receipts to fix office furniture in the
DEC building in Anchorage. Item 58 was a federal grant
related to contaminated Alaska Native Claims Settlement Act
(ANCSA) lands. Item 59 was $213,000 for a water
infrastructure grant program. Item 60 represented the
second year of funding for the same program. Item 61 was $1
million awarded under the Good Neighbor Authority program
to the Division of Water. Item 62 was about $5 million for
the assumption of primacy for the Section 404 program and
would allow the state to take primacy over permitting
activity. Item 63 was related to the Alaska Pioneer Homes
(APH) and the recent change in how the rates would be
calculated. Item 64 was to restore $500,000 in Department
of Fish and Game (DFG) funds that were ceased during the
COVID-19 pandemic. Item 65 was a fund change to adjust for
the way in which some of the administrative costs were
accounted for at DFG. Item 66 was an increase in authority
to support the facilities maintenance fees also at DFG.
Item 67 was $900,000 of prior year collected program
receipts that DFG wished to use in FY 24. Item 68 was
$150,000 for a subsistence harvest survey.
Mr. Steininger moved to page 6 and began with item 69,
which was a security enhancement costing $300,000 and
adding two non-permanent positions within the Office of the
Governor. Item 70 was reestablishing an audit unit in OMB
that was a required activity under statute and had not been
performed in a number of years. Item 71 was within DOH and
was $750,000 in a grant for a mental health program
director. Item 72 was around $700,000 in an Alaska Mental
Health Trust Authority (AMHTA) item relating to crisis care
grants. Item 73 was a unit of six individuals who would
work on increasing the state's ability to collect
recoveries and rebates as part of the Medicaid program.
Item 74 was a $2.4 million preschool development grant
match in partnership with AMHTA. Item 75 was a $75,000
recommendation by AMHTA for a comprehensive planning
coordinator. Item 76 was also a recommendation made by
AMHTA for $300,000 related to the continuum of care grant.
Item 77 was an additional AMHTA recommendation related to
data collection for $45,000. Item 78 was $570,000 in
program receipts for the public health laboratories to
support the laboratories' work on behalf on non-state
entities.
Co-Chair Johnson asked about item 74. She wondered if it
could be applied to the states' preschools and whether it
was part of the Alaska Reads Act.
Mr. Steininger would have to return to the committee with
the answer.
Ms. Stern would follow up with the information.
Representative Hannan asked about item 69. She wondered how
many security enhancements were currently in existence and
why the enhancements were non-permanent.
Mr. Steininger deferred the question to a colleague.
2:32:30 PM
CHERI LOWENSTEIN, ADMINISTRATIVE SERVICES DIRECTOR, OFFICE
OF THE GOVERNOR, JUNEAU (via teleconference), responded
that if the positions were approved, there would be a total
of nine non-permanent employees. She explained that the
positions were non-permanent because retired police
officers were often hired to fill the roles. She thought
the police officers were the most qualified for the job.
Representative Hannan asked if the positions had to be non-
permanent because the prospective employees were retirees.
Ms. Lowenstein responded in the affirmative. She added that
it was because if the officers were active employees, they
would no longer be considered retired.
Mr. Steininger moved to page 7. Item 79 was another
recommendation by AMHTA for $50,000 for the Governor's
Council on Disabilities and Special Education. Item 80 was
an addition of a non-permanent position for an intern to
help support the chief medical officer. It would be funded
with existing resources. Item 81 was $24.4 million for the
Medicaid program and addressed the enhanced Federal Medical
Assistance Percentage (eFMAP) and some federally required
rate increases. Item 82 was a reduction of $255,000 in the
Department of Labor and Workforce Development (DLWD) that
was a transfer from the commissioner's office to the
management services section. The corresponding increase was
found in item 84. Item 83 was related to the change of the
numbers section to the language section for TVEP to allow
it to be able to adjust with the estimated receipts into
the program. Item 85 was $93,000 in support for the
governor's health conference that required some budget
authority in order to execute. Item 86 was another
adjustment related to TVEP. Item 87 was a criminal
investigator related to election fraud conflict cases,
homicides, felony sex offenses, and violent crimes in
addition to matters under special prosecution within DOL.
Item 88 was the addition of an Attorney IV for parental
rights and education advocacy at a cost of $200,000.
2:36:58 PM
Representative Josephson asked about item 88. He asked how
Mr. Steininger envisioned the position functioning and how
an employee might do the job.
Mr. Steininger had to defer the question regarding the job
duties to the Civil Division.
Mr. Steininger moved to page 8 and explained that item 89
was an attorney to lead on tribal law issues. Item 90 was
an adjustment to anticipated revenues within the
commissioner's office in the Department of Military and
Veterans Affairs. Item 91 was a fund change of unavailable
authority to support the expansion of the Alaska State
Defense Force (ASDF). Item 92 was the addition of a program
coordinator to assist with the construction of the Alaska
Veteran's Cemetery. Item 93 was a reversal of an item in
the governor's budget of $100,000 in the general fund. Item
94 was an additional reversal of $272,000 in state park
receipts to ensure that the parks had safe places for
public access. Item 95 was a $114,000 increment to fund a
domestic violence and sexual assault investigator position.
Item 96 was a federal directed fund for rural Alaska State
Trooper housing. Item 97 reflected increased costs of
leases at DPS because the houses in which the troopers were
living had increased in price over the last year. Item 98
was an increase in dispatched services costs for the
Soldotna Public Safety Communications Center. Item 99 was
related to higher moving costs for troopers, particularly
when moving to rural areas of the state. Item 100 was an
increase related to vehicle operations and fuel within the
supplemental in order to ensure that the depreciation on
trooper vehicles would be funded.
Representative Hannan had a question about item 89 and
hoped someone was available from DOL to respond. She was
aware the attorney general had recently filed a suit
against the federal government related to tribal land
transfer issues. She wondered whether the attorney would
work on both the contracting and the suit with the U.S.
Department of the Interior.
Mr. Steininger responded that there was a representative
from DOL available for questions.
2:42:02 PM
AMBER LEBLANC, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT
OF LAW (via teleconference), would respond to the question
in writing.
Mr. Steininger moved to page 9 and item 101, which was
$582,000 related to internet connectivity in rural posts
within DPS. He added that item 101 was believed to be a
temporary need as federal money for broadband was incoming.
Item 102 was $60,000 related to an increase in costs for
uniforms for Alaska Wildlife Troopers (AWT). Item 103 was
$1.8 million for AWT related to a variety of other rising
costs. Item 104 was $241,000 related to maintenance and
depreciation of AWT vehicles. Item 105 was an increase of
$2.8 million for the Village Public Safety Officer (VPSO)
program to add ten additional VPSOs and provide for for
additional funding for housing allowances for existing
VPSOs. Item 106 was a decrease in funding for startup costs
for new positions within DPS. Item 107 was $100,000 for
AMHTA to fund discharge incentive grants within DOR. Item
108 was $1.2 million associated with incentive compensation
and the investment staff within the Alaska Permanent Fund
Corporation (APFC). Item 109 was $60,000 for the Central
Highways and Aviation unit within DOT to ensure that
restrooms on highway waysides were better maintained.
Representative Tomaszewski asked about the $1.2 million
funding for new staff under item 108. He asked how many
staff would be added.
Mr. Steininger replied that he would return to the
committee with the requested information.
Mr. Steininger continued to page 10 and explained that item
110 was $1.3 million to add the Dalton Highway shift
change, which involved moving the highway to a two-week on,
two-week off schedule. The change would be funded using
federal COVID-19 funds which had proved to be an effective
way to recruit and retain staff. Item 111 was $300,000 also
for wayside improvements, but for the northern region of
the highway. Item 112 was $350,000 related to maintenance
for the Sitka airport. Item 113 was $50,000 related to
rural airport cost increases. Item 114 was also related to
a TVEP grant and was moving it from the numbers section to
the language section of appropriation bill. Items 115 and
116 were both related to compensation increases and
bargaining units for employees of UA. Item 117 was a
technical change updating the description of the
Washington, Wyoming, Alaska, Montana, and Idaho (WWAMI)
program. Item 118 was also related to UA compensation
increases.
2:48:23 PM
Mr. Steininger advanced to page 11 and indicated that item
119 was a recommendation by AMHTA for a training
cooperative at the Anchorage campus. Item 120 was an
additional adjustment related to TVEP. Items 121 through
123 were related to compensation increases and bargaining
unit agreements within UA. Item 124 was also a TVEP
adjustment. Items 125 through 129 were all related to
salary adjustments within UA or TVEP adjustments. He
advanced to page 12 and explained that item 130 through
item 142 were also related to UA salary adjustments or TVEP
adjustments. All of the items on page 13 followed suit.
Representative Josephson asked for confirmation that the
professor's union had a contract that was retroactive to
July 1 if approved.
Mr. Steininger responded that he understood Representative
Josephson to be correct but suggested that the question
would be better suited for the representative from UA, Ms.
Kruckenberg.
Ms. Kruckenberg asked for the question to be repeated.
Representative Josephson repeated the question. He thought
professors were receiving 3 percent in FY 23. He understood
that if approved, the increases would be retroactive to
July 1, 2022.
Ms. Kruckenberg responded in the affirmative.
2:51:19 PM
Mr. Steininger moved to page 14 and explained that items
156 through 158 were related to the TVEP changes or the
salary adjustments. Item 159 was a slight adjustment
ensuring that there would be enough authority in the Alaska
Commission on Judicial Conduct to fund the anticipated
positions to be hired within the Alaska Court System (ACS).
Mr. Steininger moved to page 15 which began the language
section of the appropriation bill and the associated
amendments. Item 163 was an amendment to conform Alaska
Industrial Development and Export Authority (AIDEA)
dividend language to reflect the available cash. It was
adopted subsequent to the appropriation bill released on
December 15. Item 164 was a small correction to the
language for the department of education related to multi-
year federal appropriation. Item 165 was the language
section portion of the aforementioned TVEP adjustments.
Item 166 was a language item associated with the previously
mentioned Medicaid and public assistance item. Items 167
through 169 were also related to the TVEP adjustments.
Mr. Steininger moved to page 16 and indicated that items
170 through 181 represented the language section portion of
the TVEP adjustments. He moved to page 17 and explained
that items 182 and 183 were also associated with the TVEP
change. Items 184 through 187 were adjustments to the debt
service section of the appropriation bill. He added that
DOR found that it was able to refinance old general
obligation bonds to reduce the annual payments and would
save about $600,000 in FY 24. Item 188 was the adjustment
to the TVEP language. Item 189 was a deposit into the
election fund originating from a federal grant of $1
million that was matched with $200,000 in federal funds for
election maintenance costs. Item 190 was a capitalization
of $7.5 million into the Renewable Energy Grant fund to
make payments towards the grant recipients.
Mr. Steininger directed attention to the final spreadsheet,
entitled "FY2024 Capital Governor Amend Bill Summary
Spreadsheet" (copy on file). He explained that item 1 on
the spreadsheet was $1 million to address a backlog of
aging IT infrastructure in state facilities. Item 2 was
$376,000 in Division of Motor Vehicles (DMV) receipts to
remodel restrooms in the University Center DMV office. Item
3 was $2.2 million to digitize payroll services within the
Division of Finance's payroll section in order to make the
process more automatic. Item 4 was $1 million for a
statewide salary survey. He noted that many of the job
classes in the state were not consistent with salaries
available in other states for the same type of work. The
money would support a global study of all job classes to
determine if the salaries paid by the state were
competitive enough to recruit qualified personnel.
2:57:49 PM
Representative Josephson relayed that he had often heard
that there would be a few classes of jobs within one or two
departments. He understood from Mr. Steininger's
description of item 4 that there would be a wholesale
review of thousands of positions. He presumed that the
survey would clearly illuminate the type of adjustments
that would need to be made.
Mr. Steininger responded in the affirmative. He added that
the hope was that the results of the survey would provide
credible information to guide policymakers in addressing
the issue of retention as it related to salary.
Representative Hannan asked if the survey included a
geographical pay differential study.
Mr. Steininger responded that it did not.
Mr. Steininger continued on item 5, which was a removal of
a $10 million item related to the Alaska Gasline
Development Corporation (AGDC) and its hydrogen hub
project. As the corporation pursued the project, it found
it was no longer viable for the state. Item 6 was a $3.7
million grant for the new Energy Efficiency Revolving Loan
Fund Capitalization Grant Program for the Alaska Energy
Authority (AEA). Item 7 was $74.5 million in home energy
and high efficiency rebate allocations that were received
from the federal government. Item 8 was the corresponding
capital project related to the fund capitalization for
round 15 of the renewable energy project grants. Item 9 was
a $5 million appropriation to the Alaska Travel Industry
Association. Item 10 was $10 million in federal receipts
for the Fairbanks PM2.5 Nonattainment Area Voluntary
Heating Device Change Out Program.
Mr. Steininger continued on item 11, which was $1 million
in federal funds for sportfish hatcheries deferred
maintenance. Item 12 was an elections security project
under the Help America Vote Act. Item 13 was $7 million to
address voter registration and election management systems.
Item 14 was related to the replacement of the eligibility
information systems and the transition off of the mainframe
for DPS. Item 15 was additional funding for the state's
homeland security grant program because the amount of the
award was greater than the amount that was initially
included in the budget request in December 2022. Item 16
was a summary of two projects that were congressionally
directed spending projects through DMVA. One project was
for Snag Point erosion mitigation and the other was for
emergency response shelters.
Mr. Steininger continued on item 19, which was $600,000 to
address safety issues at the Geologic Materials Center
Warehouse in Anchorage. The safety issues were an ongoing
result of the earthquake in Anchorage in 2018. Item 20 was
$1 million in federal funds for the second phase of the
Potter Marsh Watershed Conservation Project. Item 21 was
$7.5 million for DPS to replace the patrol vessel enforcer
which was no longer in use due to its condition. Item 22
was the addition of $2.75 million in UGF and dividend
payments for AHFC's special needs housing project which was
unintentionally omitted from the governor's original
budget. Item 23 was an adjustment to the state equipment
fleet replacement project to ensure there was enough
authority to replace depreciated vehicles. Item 24 was $6
million from the Public Building Fund to address deferred
maintenance of public buildings. Item 25 was a summary of
several lines showing the net change involved in replacing
certain DOT projects with other projects listed below on
the spreadsheet. The initial budget proposal included a
placeholder amount for the projects and the amendments
across the following few pages included allocations for the
specific projects. He indicated that he could read through
each specific project or answer any questions the committee
might have.
3:04:59 PM
Representative Hannan referred to item 17 and asked for the
location of Snag Point.
Mr. Steininger responded that it was in Dillingham.
Mr. Steininger added that $125 million in federal dollars
would be coming into Nome for emergency repairs for the
west coast Alaska storm. The dollars were outside of the
breakout of the service transportation program. Otherwise,
the items were the various portions of the raw federal
program that were included in the original December budget.
Mr. Steininger moved to page 2 and explained that items 33
through 38 were all associated with the AMHS grant. Items
40 through 43 reflected the match associated with the
surface transportation program. Items 45 through 68 were
the allocations of the aviation improvement program, as
were lines 69 through 84 on page 3. Item 96 on page 3
through item 222 on page 6 were the allocations of the
surface transportation program itself. Each item showed
which roads and which mile posts would be maintained or
improved upon under the program.
Mr. Steininger continued on page 6 and the capital language
section of the capital bill. There was a reappropriation of
the Fairbanks Youth Facility project, which was
inadvertently sent to DOH in the split of the Department of
Health and Social Services. Instead, the facility should be
under the Department of Family and Community Services.
Representative Tomaszewski asked if there was a total [UGF
dollar amount] listed somewhere.
Mr. Steininger directed attention to slide 2 of the
PowerPoint. The UGF totals were $9.2 million in FY 23 and
$106.3 million in FY 24, for a total of $115.5 million.
Co-Chair Edgmon reviewed the meeting agenda for the
following week.
ADJOURNMENT
3:10:05 PM
The meeting was adjourned at 3:10 p.m.