Legislature(1997 - 1998)
04/16/1997 01:10 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE April 16, 1997 1:10 p.m. MEMBERS PRESENT Representative Joe Green, Chairman Representative Brian Porter Representative Norman Rokeberg Representative Jeannette James Representative Eric Croft Representative Ethan Berkowitz MEMBERS ABSENT Representative Con Bunde, Vice Chairman COMMITTEE CALENDAR HOUSE JOINT RESOLUTION NO. 7 Proposing an amendment to the Constitution of the State of Alaska prohibiting the imposition of state personal income taxation, state ad valorem taxation on real property, or state retail sales taxation without the approval of the voters of the state. - FAILED TO MOVE OUT OF COMMITTEE CS FOR SENATE BILL NO. 67(JUD) "An Act relating to the imposition of criminal sentences; and amending Rule 32.2, Alaska Rules of Criminal Procedure." - MOVED CSSB 67(JUD) OUT OF COMMITTEE (* First public hearing) PREVIOUS ACTION BILL: HJR 7 SHORT TITLE: VOTER APPROVAL FOR NEW TAXES SPONSOR(S): REPRESENTATIVE(S) MARTIN JRN-DATE JRN-PG ACTION 01/13/97 23 (H) PREFILE RELEASED 1/3/97 01/13/97 23 (H) READ THE FIRST TIME - REFERRAL(S) 01/13/97 23 (H) STATE AFFAIRS, JUDICIARY, FINANCE 02/27/97 (H) STA AT 8:00 AM CAPITOL 102 02/27/97 (H) MINUTE(STA) 02/27/97 501 (H) STA RPT 1DP 1DNP 4NR 02/27/97 502 (H) DP: HODGINS 02/27/97 502 (H) DNP: ELTON 02/27/97 502 (H) NR: JAMES, BERKOWITZ, DYSON, IVAN 02/27/97 502 (H) FISCAL NOTE (GOV) 02/27/97 502 (H) REFERRED TO JUDICIARY 04/16/97 (H) JUD AT 1:00 PM CAPITOL 120 BILL: SB 67 SHORT TITLE: TRUTH IN SENTENCING SPONSOR(S): SENATOR(S) HALFORD, Green, Donley, Kelly, Taylor, Leman, Sharp, Pearce, Torgerson, Mackie, Miller, Phillips; REPRESENTATIVE(S) Croft, Kemplen JRN-DATE JRN-PG ACTION 01/29/97 161 (S) READ THE FIRST TIME - REFERRAL(S) 01/29/97 161 (S) STA, JUD 02/04/97 (S) STA AT 3:30 PM BELTZ ROOM 211 02/04/97 (S) MINUTE(STA) 02/06/97 249 (S) STA RPT CS 4DP SAME TITLE 02/06/97 249 (S) DP: GREEN, MILLER, WARD, MACKIE 02/06/97 249 (S) ZERO FN TO SB & CS (COURT) 02/10/97 267 (S) FN TO SB & CS (LAW) 02/13/97 341 (S) FIN REFERRAL ADDED FOLLOWING JUDICIARY 02/21/97 (S) JUD AT 1:30 PM BELTZ ROOM 211 02/26/97 (S) JUD AT 1:30 PM BELTZ ROOM 211 02/26/97 (S) MINUTE(JUD) 03/05/97 566 (S) JUD RPT CS 4DP 1NR SAME TITLE 03/05/97 566 (S) DP: TAYLOR, MILLER, PEARCE, PARNELL; 03/05/97 566 (S) NR: ELLIS 03/05/97 566 (S) ZERO FNS TO CS (DPS-2, LAW) 03/05/97 566 (S) PREVIOUS ZERO FN APPLIES (COURT) 03/12/97 (S) FIN AT 9:00 AM SENATE FINANCE 532 03/12/97 688 (S) FIN RPT 5DP (JUD)CS 03/12/97 688 (S) DP: SHARP, PEARCE, 03/12/97 688 (S) PHILLIPS, PARNELL, DONLEY 03/13/97 (S) RLS AT 10:45 AM FAHRENKAMP RM 203 03/13/97 (S) MINUTE(RLS) 03/13/97 718 (S) FN TO JUD CS (S.FIN/CORR) 03/12/97 688 (S) PREVIOUS ZERO FNS (COURT, DPS-2, LAW) 03/13/97 718 (S) RULES TO CALENDAR 3/13/97 03/13/97 720 (S) READ THE SECOND TIME 03/13/97 720 (S) JUD CS ADOPTED UNAN CONSENT 03/13/97 720 (S) ADVANCED TO THIRD READING UNAN CONSENT 03/13/97 720 (S) READ THE THIRD TIME CSSB 67(JUD) 03/13/97 720 (S) COSPONSORS: KELLY, TAYLOR, LEMAN, SHARP 03/13/97 720 (S) PEARCE, TORGERSON, MACKIE, MILLER, PHILLIPS 03/13/97 720 (S) PASSED Y20 N- 03/13/97 721 (S) COURT RULE(S) SAME AS PASSAGE 03/13/97 726 (S) TRANSMITTED TO (H) 03/14/97 661 (H) READ THE FIRST TIME - REFERRAL(S) 03/14/97 661 (H) JUDICIARY, FINANCE 04/16/97 (H) JUD AT 1:00 PM CAPITOL 120 WITNESS REGISTER REPRESENTATIVE TERRY MARTIN Alaska State Legislature Capitol Building, Room 502 Juneau, Alaska 99811 Telephone: (907) 465-3783 POSITION STATEMENT: Prime Sponsor of HJR 7. BRAD PIERCE, Senior Policy Analyst Office of Management Office of the Governor P.O. Box 110020 Juneau, Alaska 00811 Telephone: (907) 465-3008 POSITION STATEMENT: Provided testimony on HJR 7. BRETT HUBER, Legislative Assistant to Senator Rick Halford Alaska State Legislature Capitol Building, Room 129 Juneau, Alaska 99801 Telephone: (907) 465-4958 POSITION STATEMENT: Spoke on behalf of sponsor of SB 67. MARGOT KNUTH, Assistant Attorney General Criminal Division Department of Law P.O. Box 110300 Juneau, Alaska 99811 Telephone: (907) 465-3600 POSITION STATEMENT: Provided department's position and answered questions regarding SB 67. ACTION NARRATIVE TAPE 97-58, SIDE A Number 001 CHAIRMAN JOE GREEN called the House Judiciary Standing Committee to order at 1:07 p.m. Members present at the call to order were Representatives Brian Porter, Jeannette James, Ethan Berkowitz and Chairman Joe Green. Representative Rokeberg arrived at 1:10 p.m. and Representative Eric Croft arrived at 1:11 p.m. HJR 7 - VOTER APPROVAL FOR NEW TAXES CHAIRMAN GREEN announced that the committee would first consider HJR 7, proposing an amendment to the Constitution of the State of Alaska prohibiting the imposition of state personal income taxation, state ad valorem taxation on real property, or state retail sales taxation without the approval of the voters of the state. Number 045 REPRESENTATIVE TERRY MARTIN, Prime Sponsor of HJR 7, advised members that over the years, people of East Anchorage, which was his district, as well as people all over the state were concerned about taxation since it was repealed. Representative Martin pointed out that Alaska was one of the states where a simple majority was needed in order to impose a personal tax, of one nature or another, on the people. He did not believe that technique provided the people any voice at all in the matter of taxation. Representative Martin noted that most states required a two-thirds majority vote, and one state required a four-fifths majority vote by both houses in order to approve the imposition of a personal tax prior to it going to the people. REPRESENTATIVE MARTIN thought that it was either 21 or 24 states that required final approval of a tax be by the people. He noted that oddly enough, people were very considerate of what type of tax was brought before them and they would approve or not approve. Representative Martin believed the voice of the people was the most important things that helped develop the country. REPRESENTATIVE MARTIN pointed out that the resolution had been considered by the previous legislature and it was passed on to the floor where they were four votes short of reaching a two-thirds majority vote. He advised members that the Constitution was supposed to be the voice of the people and taxation should be a part of that voice. Number 245 REPRESENTATIVE JEANNETTE JAMES referred to a backup document contained in member's bill files titled 1995 State Tax Revenues, Source: U.S. Bureau of the Census and Bureau of Economic Analysis, and asked Representative Martin if he knew how they arrived at those numbers. She pointed out that it stated that the per capita dollars of state tax revenues was $3,185 in Alaska, which was 13.6 percent of personal income, and ranked one in percentage of personal income. Representative James stated that she assumed they were talking about all taxes, including severance taxes, but probably not royalties because those were not necessarily taxes. REPRESENTATIVE MARTIN advised members that his office had talked to the Census Bureau and the Bureau of Economics on two occasions after the national reports had been published and asked what criteria they were using. He stated that basically, it showed the total amount of revenues that came into a state through taxing, and they did not break it down much as to whether it was personal tax, corporation tax, severance tax, or what. They just note that a state received perhaps $3 billion in taxes, and they then break it down per capita. REPRESENTATIVE JAMES advised members that one of the things that distressed her was that everyone liked to make a comparison between the state of Alaska and the rest of the world, and they usually did it on a per capita basis, or possibly per 100,000 people. She expressed that Alaska was unique compared to other states because of its size and much of the state being unorganized. Representative James pointed out that if oil taxes and severance taxes were included in the data it would reflect Alaska differently because those funds go into the state's coffer, whereas in the other states most of those monies go into private pockets. She advised members that she did not have much faith in the data provided by the Census Bureau or Bureau of Economic Analysis. REPRESENTATIVE MARTIN advised members that John Manley, his legislative assistant, had written to the National Conference of State Legislatures (NCSL), and provided special information as to how Alaska taxes were broken down. He noted also that the NEA Magazine broke down what Alaska paid out towards education and made the state look very bad as to not supporting education. Representative Martin advised members that Mr. Manley compiled a lot of information from the University and from kindergarten through high school and sent it to the University of Illinois. He noted that they finally received a response which acknowledged good points had been displayed. Representative Martin pointed out that they had stated that Alaska was one of the cheapest in the nation in providing support to the University. He stated that after sending back an extensive amount of information, their response was that they would make an honest effort in providing more realistic information in their next annual report. REPRESENTATIVE JAMES advised members that she would like to see a comparison between Alaska and the rest of the states and she believed it would show that Alaska was paying less than the other states if they only counted the taxes paid out of pocket. She stated that she would also like to have a comparison on the amount of federal taxes the state of Alaska paid. Representative James expressed that if Alaska could get the federal government to give Alaska a tax break, the state could afford to pay some of its own, although she felt that would be pretty hard to do. REPRESENTATIVE MARTIN felt it was necessary that Alaska work as a team with NCSL who administered those reports. Number 560 CHAIRMAN GREEN stated if the resolution were to pass, because of all the various programs the state of Alaska had compared to many of the other states, of providing money to the public, would it be less likely that when taxes were needed there would be less likelihood for the proletariat to vote in favor of a tax, simply because there were still sources of revenue coming into the state. REPRESENTATIVE MARTIN stated that from what he had been observing, and yesterday in Anchorage when there was a vote taken on the bond issue, that there was overwhelming support because they saw the need and did not mind the increase in property taxes on the bonding. He stated that if the legislature, or the governing body, present a picture to the people and the people realized they were in charge of the purse string, they would support it. REPRESENTATIVE PORTER stated that if the bill were law and the people voted in favor of a state sales tax and the legislature wanted to change the rate of that sales tax, if that require voter approval. REPRESENTATIVE MARTIN stated that it would go before the people for approval. REPRESENTATIVE PORTER pointed out that the wording said; a law establishing a sales tax on personal income tax would have to be approved. It did not say amending an existing tax, it just spoke to "establishing". REPRESENTATIVE MARTIN thought it spoke to an increase in a personal tax of one nature or another also. He stated that members could add the word "increase". REPRESENTATIVE NORMAN ROKEBERG advised members it was his understanding a State ad valorem tax on real property currently existed. REPRESENTATIVE MARTIN agreed, and again that would come into effect with an increase in that tax; however, it appeared the word "increased" had been dropped from the bill. REPRESENTATIVE ROKEBERG advised members he was concerned about that and as a member of the House Special Committee on Oil and Gas they had the opportunity to hear reports as to the development of a trans-Alaska gas pipeline. A recommendation brought forward in that committee was the need to reform the state's tax regime in order to create an incentive for investment in the state of Alaska. Representative Rokeberg advised members that among those mentioned was the ability to lower, particularly, the ad valorem taxes on capital equipment and materials used for the construction of a gas pipeline. He stated that, keeping that in mind, to make that work so eventually the municipalities and the state of Alaska would be kept whole, there would be a lowering of taxes, or potentially an abatement of those taxes for a period of time, and after the pipeline reached a level of profitability under contractual, long term obligations, those taxes could be increased. Representative Rokeberg felt the ad valorem taxes would be one of the primary methods of being able to create a sliding scale type of taxation on those kinds of assets. He stated that an amendment such as HJR 7 would absolutely bar any kind of negotiations like that. REPRESENTATIVE MARTIN advised members that as used in the resolution, ad valorem was meant to be the real property of an individual, not as an ad valorem tax on the property of corporations, unless they would assume a corporation was a person. CHAIRMAN GREEN did not see the resolution drafted that way. REPRESENTATIVE ROKEBERG agreed with Chairman Green REPRESENTATIVE ERIC CROFT asked if it was the sponsor's intent to get voter approval for a decrease in taxes. Number 966 REPRESENTATIVE MARTIN stated that he was addressing the imposition of a new tax, or increase in personal taxes, or personal real property. He stated that a decrease in taxes would not need voter approval. BRAD PIERCE, Senior Policy Analyst, Office of Management and Budget, Office of the Governor, advised members the administration did not have a firm position on the resolution. He pointed out that changing the Constitution that would result in the legislature losing one of its powers was fairly serious business. Mr. Pierce advised members that the administration saw the resolution as a basic difference between the Governor's pledge not to use permanent fund earnings without a vote of the people. He noted that the permanent fund was established after statehood by a vote of the people. Mr. Pierce stated that, clearly, when the framers of the state's Constitution wrote the provision which stated that the power of taxation shall never be surrendered, it was felt that the legislature should not give that power away to municipalities, or to others. Mr. Pierce advised members that those were the fundamental concerns of the resolution. MR. PIERCE stated that it was also the administration's feeling that giving up the responsibility to tax would make closing the fiscal gap much harder because it foreclosed the legislature's option to act. He noted that there was also the law of unintended consequences that the state could end up with a very strange tax structure if HJR 7 were to be in place. Mr. Pierce advised members that Washington state, because they had never wanted an income tax had ended up taxing everything that moved, which resulted in a very regressive tax structure. He pointed out that Alaska already had a fairly strange tax structure with 80 percent of the state's general fund coming from oil revenues. Number 1215 REPRESENTATIVE ETHAN BERKOWITZ asked how problematic it could be if the state could not respond quickly to a change in circumstances. He noted that Representative Rokeberg brought up the instance of changing the state's tax structure in order to develop a gas pipeline, and asked if there were any other projects that would be affected by the state's inability to change the tax structure quickly. MR. PIERCE did not believe so; however, the idea was that it would limit the state's options to deal with the state's fiscal situation. REPRESENTATIVE BERKOWITZ stated that in other jurisdictions tax inducements had been offered for corporations to relocate, and asked if the implementation of HJR 7 would impede the state's ability to do that. MR. PIERCE stated that if Representative Berkowitz was speaking to an offer of credits, he was not sure, but felt someone from the Department of Law could respond to that question. REPRESENTATIVE ROKEBERG pointed out that the Governor had introduced a bill where corporations hiring welfare recipients would receive a $1000 tax credit. He advised members he was also introducing a bill, along those same lines, about Alaskan residents, and HJR 7 would tie his hands, the governor's hands, as well as the legislature's. Representative Rokeberg expressed that if the price of oil went to $8 per barrel it would be necessary to look at existing taxes in the state, and do some restructuring of them. CHAIRMAN GREEN pointed out that many members would recall when the price of oil did decrease to nearly $8 per barrel a number of years ago. REPRESENTATIVE JEANNETTE JAMES did not see the same fear of not being able to move quickly and pointed out that the state was not poor, and if there was an emergency, there were reserves available to use. She stated that she, as a State Representative, was willing to impose state taxes on the public when the public was willing and ready, but not before. Representative James felt that HJR 7 could be used in that manner as to how the people felt about an increase in taxes. She asked if Mr. Pierce could think of any specific circumstance, other than a drastic drop in oil prices, that would cause the legislature to act faster than having to wait for a vote of the people. MR. PIERCE advised members that he could not think about anything off the top of his head; however, pointed out that they were talking about a constitutional amendment, and to change the State's Constitution it would be necessary to wait for another general election. REPRESENTATIVE JAMES advised members that she had a real problem with a state ad valorem tax on real property, and did not know how that could be defined to mean personal property, as opposed to other than personal property because she felt the ownership of property was varied in so many ways. Representative James stated that if the issue would be put to the public she would like that language removed, and only pose the question as to state tax on personal income and state retail sales tax, which were the only two broad based taxes that were of great concern. Number 1463 REPRESENTATIVE ROKEBERG pointed out the mention of the Governor's desire to have some type of voting mechanism for the appropriation of permanent fund earnings, and asked if that legislation had been introduced to that effect. MR. PIERCE stated that there was no pending legislation at the present time. REPRESENTATIVE CROFT asked if a retail sales tax would be imposed on all products and if alcohol, tobacco and gas taxes would go to the vote of the people as well. REPRESENTATIVE JAMES stated that those would be whole sale taxes. REPRESENTATIVE CROFT advised members that when discussing the bill which would allow alcohol to be taxed at a higher rate that North Pole implemented a bed tax that allowed them to tax alcohol. He pointed out that he had not thought of a bed tax as a sales tax prior to that; however, felt in that case, it was an innovative approach that got him thinking that maybe sales tax was a lot more broad than he thought it was. REPRESENTATIVE MARTIN stated that in local government, the public had the opportunity to vote on ship taxes and bed taxes and stated that he had no problem in doing that at the state level if the public wanted to vote on an alcohol tax or cigarette tax. CHAIRMAN GREEN advised members that he supported the thought that an increase in taxes or imposition of new taxes should be the will of the people, as was stated by Representative James, and thought most members felt that way. He noted that the legislature was in the mode of trying to reduce the cost of government to the point that the people would say, that is enough, and now we're going to have to find other sources of revenue. Chairman Green advised members that in order to get at the intent of the proposed legislation, which would be the undeniable will of the people by some sort of an advisory vote or polling type mechanism, that there was a concern as to how often, and under what circumstances, the legislature should approach the people for voter approval. Chairman Green pointed out that if that was done very often, to him that would be an abrogation of the responsibility of the legislature. Number 1630 REPRESENTATIVE MARTIN pointed out that during the Cowper Administration the advisory vote relating to education endowment was not approved by the people, and now the Lt. Governor had just approved an advisory vote on education. He stated that by giving the people the power, as in HJR 7, it would be the final voice of the people. REPRESENTATIVE JAMES pointed out that other states required a two thirds majority vote, and sometimes even a three quarter majority vote, which was not the case in the state of Alaska, and she asked why that would not be a better way to go. REPRESENTATIVE MARTIN advised members that his personal desire was to get a final voice of the people. He noted that in the past even the founding fathers wanted to require a super majority, under certain elections, and it had always failed because when it came to the people they wanted true democracy of a simple majority. REPRESENTATIVE JAMES advised members that in Fairbanks, a sales tax had been presented on the ballot seven times and sometimes the voters said no, and she pointed out also the situation with the school bonding issue of being put to the people three different times. REPRESENTATIVE MARTIN stated that Anchorage had turned down some of the bonding packages in the past as well. CHAIRMAN GREEN advised members that there was an issue brought up in the House State Affairs Committee the previous year regarding requiring a varying degree of public percentage with a simple majority and a two thirds majority, and there had been quite a bit of discussion that a specific percentage might not be gotten. He noted that Representative Martin had indicated that other states required an 80 percent voter approval and asked if such a high percentage had ever been reached. REPRESENTATIVE MARTIN advised members that he was speaking to a percentage of the voters, that that would always be a simple majority. REPRESENTATIVE CROFT advised members that he was interested in the idea of a referendum where the people had the ability to cancel out any law enacted by referendum during the next election, and he thought that was phrasing HJR 7 in the negative, where the legislature passed a tax and the people come back at the next election and said no. He asked why that process would not be a better approach, or a statute that stated that any tax put on the books shall automatically be placed before the public for a referendum vote. REPRESENTATIVE MARTIN advised members that was how some other states operated; however, Alaska's Constitution stated that the power of taxation should never be surrendered, and the people could not address a tax either through an initiative or a referendum. He stated that in the state of Alaska the referendum was almost worthless because the time restraints for the people to get the necessary signatures was almost impossible. Number 1989 REPRESENTATIVE CROFT asked if that was a judicial decision or an attorney general opinion. REPRESENTATIVE MARTIN advised members that the Constitution made it very clear that the people not have control of the state's purse strings. REPRESENTATIVE ROKEBERG advised members that he agreed with Representative Martin's concept in terms of making sure that the public had an opportunity to be known and heard when it came to tax policies. He stated that any change that the legislature might consider on that issue in the future was a huge state change of public policy. Representative Rokeberg stated that having voter input and the people having that ability he felt was very important; however, HJR 7 was abrogating the legislature's entire constitutional responsibility, and he was very concerned about that and felt it was the wrong approach, although he agreed with the concept. Representative Rokeberg advised members he was also concerned about the testimony members had heard regarding the Governor's opinion about the earnings reserve fund, which he felt was really extraordinary, adding that that would be a usurpation of legislative power. Number 2015 REPRESENTATIVE PORTER pointed out that the issue before the committee had been discussed in previous legislatures and he respected the sponsor's position and feelings on that particular area of the law. Representative Porter advised members that he had a different foundation of thought in that area and did not think it was appropriate in a state that had the usual tax structure that Alaska had that could be impacted by a single factor. He stated that to put into place an absolute bar that could occur for up to two years to be able to respond to that kind of emergency, to him was irresponsible and he could not support it. REPRESENTATIVE JAMES moved to amend HJR 7, on line 9, after "income," delete [a State ad valorem tax on real property]. There being no objection, Amendment 1, HJR 7 was adopted. REPRESENTATIVE ROKEBERG expressed that he was distressed because he had told the people in his district that he wanted to make sure they had an ability to vote on the imposition of taxes; however, he did not believe that was what HJR 7 did. He stated that the shift of power, as in HJR 7, went well beyond what he thought should be granted. Representative Rokeberg pointed out that there had been discussion as to whether the state should go to a statewide sales tax, versus an income tax, and he felt the only way to get a gauge on that issue was to have an advisory vote, if needed. REPRESENTATIVE JAMES agreed with the statements of Representative Rokeberg and was not afraid of putting the proposed resolution on the floor for a vote, and because of that moved to report CSHJR 7(JUD) out of committee with individual recommendations and attached fiscal note. Representative Porter objected. CHAIRMAN GREEN requested a roll call vote. In favor: Representative James. Opposed: Representative Porter, Rokeberg, Croft, Berkowitz and Chairman Green. Representative Bunde was absent. CSHJR 7(JUD) failed to move out of committee by a vote of 5 to 1. CSSB 67(JUD) - TRUTH IN SENTENCING [Contains discussion of SB 25.] CHAIRMAN GREEN advised members they would next consider CSSB 67(JUD), "An Act relating to the imposition of criminal sentences; and amending Rule 32.2, Alaska Rules of Criminal Procedure." Number 2231 BRETT HUBER, Legislative Assistant to Senator Rick Halford, Prime Sponsor, advised members that Senator Halford introduced SB 67 to provide victims of crime, their families and the general public an honest and accurate assessment of the time which would actually be served by a person convicted of a crime. Mr. Huber noted that SB 67 was consistent with the Victim's Rights Constitutional Amendment that was passed by the legislature and ratified by popular vote in 1994. MR. HUBER advised members that their bill packets included a sponsor statement, sectional analysis and various letters of support. He pointed out that the bill was heard on Senate side in the State Affairs, Judiciary and Finance committees, and passed the full body by a vote of 20 to 0 on March 13, 1967 MR. HUBER advised members the proposed legislation was fairly straight forward and he would provide a brief overview if the Chairman would like. Number 2283 REPRESENTATIVE BERKOWITZ gathered that the intent of the proposed legislation was for the purpose of protecting victims to ensure that they know when defendants were going to be released from state custody. MR. HUBER explained that the intent of the bill was to make sure the public had a more accurate assessment of time actually served when a sentence is handed down by the court. REPRESENTATIVE BERKOWITZ asked if one of the components was to know when a defendant was going to be released. MR. HUBER did not know if the bill expressly stated that. He advised members that the intent was merely that when a sentence is rendered by the court that the public, the victims and those affected would have an understanding of what the actual minimum time required to serve would be under the imposed sentence. REPRESENTATIVE BERKOWITZ asked what Mr. Huber's understanding was of how sentences were currently rendered. MR. HUBER felt that was a fairly broad question and asked if Representative Berkowitz could narrow it down some. REPRESENTATIVE BERKOWITZ stated that it appeared that the whole point of the bill was that judges were not saying enough in court, and he was curious to know what the sponsor thought judges were saying in court that would necessitate the proposed legislation. MR. HUBER advised members that it was the Senator's understanding that when a judge imposed a sentence that the length of time necessary to serve depended on whether there was a mandatory sentence for the crime committed, and other variables, but the judge basically passed a sentence down of "X" amount of time. He noted that qualifiers were included, suspension of a portion of the sentence, concurrent sentences, et cetera. What was not being disclosed, at the time of sentence, was what the minimum amount of time would be when considering things such as mandatory or discretionary parole. Mr. Huber advised members that was the intent of the proposed legislation, to make sure the minimum, or actual amount of time that could possibly be served be a part of the information relayed to the people in the courtroom at the time of sentencing. CHAIRMAN GREEN noted that it was also imposed that an individual could not be released prior to serving two thirds of his/her sentence, or greater than one third time paroled. MR. HUBER advised members that the bill did nothing to change how current sentences were imposed, or existing mandatory or discretionary parole provisions. It merely brought some sunshine into the process of what those sentences would compute into when considering mandatory and discretionary parole provisions. CHAIRMAN GREEN asked if, currently, people who had been convicted of a crime would be required to serve at least two thirds of the sentence handed down by the courts. MR. HUBER stated that, currently, people convicted of a crime were eligible to receive credit for good time, which was one third of the imposed sentence. He explained that discretionary parole provided the opportunity for criminals to be released prior to the time of a mandatory parole, which could be substantially less than the two thirds requirement. Number 2430 REPRESENTATIVE JAMES noted that she did not completely understand mandatory and discretionary parole; however, she did understand what the legislation was purporting to accomplish. Representative James advised members that her concern was if a judge imposed a long sentence, but then after considering all the variables that had to be relayed to the audience in the courtroom that the individual could be released within a much lesser time period than the original sentence, would more than likely distress people a lot. Representative James assumed that was why the courts did not provide all that information at the time of sentencing. MR. HUBER advised members that was exactly the situation the sponsor was attempting to address. Senator Halford believed that the public ought to know what the sentences that were being passed down translated into under the current parole provisions. REPRESENTATIVE JAMES believed there were cases when the state's correctional facilities were full, and in order to accommodate that problem, select individuals would be paroled early in order to free up bed space. She pointed out that she believed the department provided early releases within the framework of what is, or what was not allowed, although sometimes she felt that a much earlier release could take place than anyone ever anticipated. TAPE 97-58, SIDE B Number 000 REPRESENTATIVE BERKOWITZ explained that once a defendant is sentenced, he/she is under the custody of the Department of Corrections and they have control over release by parole. He advised members that a convicted person is required to serve two thirds of his/her sentence, at which time the individual would be eligible for good time; however, pointed out that good time could be taken away by the department for various reasons. Representative Berkowitz stated with respect to a three year sentence, the person would be illegible for parole in two years, but if the prisoner messed up in some manner, he/she would be required to serve the full imposed sentence of three years. MR. HUBER advised members it was his understanding that that computation was actually made by the Department of Corrections at the time they receive the prisoner after the sentence had been imposed. He stated that good time was basically an automatic credit on account. Mr. Huber noted that there was the opportunity to remove the good time, if a person conducted some type of misbehavior while incarcerated. Mr. Huber stated that the Department of Corrections also had the authority to reinstate the person's good time after it had been removed. REPRESENTATIVE PORTER advised members it was his understanding that it would be possible to compute and advise a victim at the time of sentencing what the earliest release date could be, although it would not necessarily be the exact time because of the department's ability to take away good time earned because of behavior problems. Number 77 REPRESENTATIVE ROKEBERG referred to the fiscal note in the amount of $715,000, and asked what those funds would be expended towards. He asked, because it was federal money, if it had been marked for a specific use. MR. HUBER advised members it was federal money that was available through Federal Truth in Sentencing construction funds for prison facilities. He noted that the current fiscal note, prepared by the Senate Finance Committee, reflected a $650,000 possible capture of federal funds. Mr. Huber advised members that those federal funds would require a 10 percent match, which would be $65,000 in general funds, leaving $715,000 that would be available to the legislature to appropriate towards the construction of correctional facilities, if they so chose to accept and appropriate those funds. CHAIRMAN GREEN asked if that was a three year program. MR. HUBER advised members there were three years left in that program, and the estimate of $650,000 was the amount that the state of Alaska would have qualified for had the provision and the language included in section 2 of the bill been in place. He noted that it was possible that that amount would be reduced from $650,000, over time, as other states qualify for those funds. Number 133 REPRESENTATIVE ROKEBERG was pleased to see a positive fiscal note, especially in the Department of Corrections, of which he was a member of the budget subcommittee. He asked if the court, upon sentencing, had the duty to inform the victim of the defendant's release date. MR. HUBER advised members that as he understood the procedure, a sentence was imposed both orally and within a sentencing report that was a document of the courts and available to the victims; however, he knew of no specific mandate for the court to supply that information to the victims. REPRESENTATIVE ROKEBERG pointed out that as the legislature expands on the issue of victim's rights a problem had surfaced as to who really was the victim. REPRESENTATIVE PORTER saw nothing in the bill that would require any specific notifications other than providing an explanation of the sentence at the time the sentence was rendered and recorded. Number 206 REPRESENTATIVE CROFT asked for clarification of the fiscal note and the $650,000. MR. HUBER advised members that the Department of Corrections had prepared a fiscal note that did reflect the $65,000 match and expenditures, and showed a $715,000 capital expenditure. He stated that the problem that the Senate Finance Committee had was that it was not yet determined by the legislature whether they should receive and expend those funds, so the Senate Finance Committee did not feel comfortable with committing to that in the fiscal note. Mr. Huber advised members that the analogy on page two of the fiscal note would explain that. REPRESENTATIVE CROFT asked if what was being said was that the state did not know where they would spend those funds, but knew they would likely be received. MR. HUBER advised members that there were guidelines as to where, or how those funds could be spent, which was for the construction or renovation of correctional facilities that would result in providing additional bed space. REPRESENTATIVE CROFT asked if that would include any capital expenditure relative to a correctional facility. MR. HUBER noted that Margot Knuth, with the Department of Law, could address those questions specifically. Number 318 MARGOT KNUTH, Assistant Attorney General, Criminal Division, Department of Law, advised members there was a violent offender incarceration and truth in sentencing incentive grant program that the Department of Justice made available to states. She explained that the state of Alaska had not qualified for the truth in sentencing part of the grant program yet. Ms. Knuth pointed out that there had been a recent change made by the federal department that would make it easier for states to qualify. She advised members that previously, in order to qualify for truth in sentencing funds, the state would have had to increase the amount of time that the state's prisoners serve from two thirds of the sentence, to 85 percent. MS. KNUTH pointed out that truth in sentencing still required that a prisoner serve 85 percent of their sentence, but the Department of Justice had changed that to say that the 85 percent of the prison sentence was just the sentence of actual incarceration time and the state would not have to include supervised release time, which was what Alaska had with the mandatory parole system for anyone with a sentence of over two years. Ms. Knuth advised members that was termed the "Minnesota Exception"; the way of bifurcating a sentence in statute, but did not change how long state prisoners would actually serve. MS. KNUTH stated that the funds were to be used to reduce overcrowding or increase bed space which could be done in many different ways. She explained that existing facilities could be renovated, and there was a provision that allowed sharing with municipalities; the theory being that a municipality would do something with their misdemeanants that would free up some bed space for the violent felons. Ms. Knuth stated that those funds could also be used for expansion planning purposes, but it had to be a capital expenditure, not used for operating expenses. CHAIRMAN GREEN asked if it could be used in some manner for the prisoners that had been sent outside Alaska. MS. KNUTH advised members that there was a provision for using privatized facilities. The theory there, again, was that it would free up some hard beds in Alaska for other offenders. CHAIRMAN GREEN believed the Arizona facility involved an operating expense, rather than a capital expense. MS. KNUTH agreed, and that was why the booklet containing all the criteria was as thick as it was. Ms. Knuth advised members that based on the status of the proposed legislation that currently the state could apply for those funds before the upcoming deadline date, and the federal government would then look to see whether the legislation was enacted and the state would be considered, at that point, whether Alaska would qualify or not. Ms. Knuth pointed out that the question was how many more states were doing the same thing as Alaska, simultaneously, for qualification of those funds. She noted that there were only 17 states that qualified last year, and as the number of states increase, the pot of money that was being distributed would dissipate a little bit. MS. KNUTH pointed out that Alaska had just been approached by one of the small states in the east who would like to work on creating a floor, or a minimum amount that each state could get, which would be of tremendous assistance to the state of Alaska. She stated that it would not cost the states like California and Florida that much because they were getting so much money, but it could bring Alaska into the $1 million to $2 million range. Number 538 REPRESENTATIVE BERKOWITZ asked if the intent of the federal matching funds was to provide more rights to the victims of a crime. MS. KNUTH advised members the intent was to foster protection of the public, and victims were some of the most interested persons in the state's criminal justice system. REPRESENTATIVE BERKOWITZ pointed out there was other proposed legislation which dealt with the victim notification system, and he felt that possibly added some teeth to SB 67. The other legislation provided for notification of the victim when the prisoner was going to be released, and Representative Berkowitz asked if the implementation of the victim notification system would qualify as renovation under the federal scheme. MS. KNUTH did not believe the federal funds could be used in that manner because it specifically requires those funds be applied towards capital expenditures to increase bed space within the prison system. CHAIRMAN GREEN asked if Minnesota had the same type of system as Alaska which included an automatic probation or release date. MS. KNUTH advised members that Minnesota did have the same type of system and explained that at the conference, there was a panel of three different ways that states with determinant sentencing could qualify, and sitting right in the middle was Minnesota to assist states like Alaska to realize that there had been a change and could now qualify for those funds. She stated that it was a part of the executive branch's decision, on the federal level, that they did not have an interest in coercing the state to increase the length of time that Alaska prisoners stay incarcerated because that was terribly expensive. Ms. Knuth advised members that if the state was required to go from 66 percent to 85 percent of sentences for Alaska prisoners, that the price tag on that would never motivate the state to participate; however, she pointed out that truth in sentencing, in itself, was a good goal because there were misconceptions about how long a person would be incarcerated. Number 690 REPRESENTATIVE CROFT referred to the booklet Ms. Knuth had and referred to page 7, it stated that in order to receive a grant the state would have to certify by October 26, 1997, that the state had adopted policies that provide for the rights and needs of crime victims. It went on to say that the state should provide notice to victims concerning case and offender status. Representative Croft pointed out that the state would have to certify, by October, that it was notifying victims of the status of their offender, of which he assumed most importantly would be the release date. MS. KNUTH stated that was correct and was a statutory and constitutional obligation that the Executive now had, and the state was fulfilling that obligation through paralegals and district attorneys offices, as well as through the Department of Corrections when a victim provides the information that they want to be notified of the offender's release date. MS. KNUTH advised members that an automated victim notification system would have the advantage because you could input the information and it then calls a phone number repeatedly for a period of several days until the right code is entered in to provide that information. She said another part of that system came with a 900 phone number that costs $1.80 for the first minute and 95 cents a minute thereafter that would allow anyone to call the number to find out if a particular person was incarcerated, where at and what their release date was at that time, and that could relieve the state of the burden of having to provide that type of information. Ms. Knuth expressed that the department was receiving over 400 calls a day requesting information about who was in custody, where they were incarcerated and when would they be released. Ms. Knuth stated if the department were to receive over 500 calls a day, the requestor would have to pay a fee for that information, and that charge would be enough to cover the expense of implementing an automated victim notification program. Number 830 REPRESENTATIVE CROFT wanted to make the argument that a capital expenditure for equipment to notify victims could in some cases, be a way to save bed space. He pointed out that there had been a lot of discussion about moving certain classes of offenders into halfway houses and saving money through that method. REPRESENTATIVE CROFT noted that there had been some controversy on that issue because in halfway houses there was more of a potential for the offender to walk away and commit a crime. Representative Croft stated that if an offender were released to a soft bed, which would free up hard bed space, and the victim was notified of the release date from a soft bed facility, that that would be a method of reducing prison overcrowding. MS. KNUTH felt there was merit to the argument presented by Representative Croft; however, the federal grant program specified how those funds could be utilized and it would be necessary to use those funds for construction purposes, either through remodeling existing facilities, or building new facilities. She added that she would be glad to look further into the suggestion made by Representative Croft. REPRESENTATIVE PORTER moved to report CSSB 67(JUD) out of committee with individual recommendations and attached fiscal note. Representative Berkowitz objected for the purpose of discussion. Number 962 REPRESENTATIVE BERKOWITZ expressed that the bill, in its present form, did not provide for much more than what already happened in court, and he felt that if the state was intent on providing victims protection and provide notification of an offender's release date that there was a vehicle for that purpose. He noted that SB 25 was the victim notification bill and he might offer an amendment to CSSB 67(JUD) that would shoehorn in SB 25 where appropriate. Representative Berkowitz pointed out that both bills addressed the same topic and consistent with the intent and it would be at zero cost to the state. CHAIRMAN GREEN advised members that his concern was that the amendment appeared to be substantial and members had not had a chance to review its effect. He noted that the committee had a standing rule that required advanced notice of proposed amendments in a timely fashion. Chairman Green pointed out that there was a motion on the floor and was not sure Representative Berkowitz proposal fit under the motion before the committee. Chairman Green stated that Representative Porter could withdraw his motion for the purpose of discussing the idea put forth by Representative Berkowitz. Number 1086 REPRESENTATIVE ROKEBERG stated that Ms. Knuth had expressed that the state already had a statutory and constitutional requirement to notify victims presently, and asked if the change would be the automated program discussed earlier. REPRESENTATIVE BERKOWITZ stated that as he understood the notification process that the Department of Law had a difficult time in locating people and that it was very time intensive process. He advised members that the automated system would eliminate all the wasted labor that was being taken away from ongoing cases. Representative Berkowitz explained that it would free up personnel in the Department of Law to pursue current/active cases, and there would be a greater likelihood of contacting victims. REPRESENTATIVE PORTER declared a point of order. He pointed out that what was being discussed was a bill in another committee. Representative Porter explained that he had discussed, with the maker of the amendment very briefly, the notion that that might qualify; however, he felt it would be more appropriately formed into an amendment, after researching the federal guidelines to see if it would even qualify, which could occur in the House Finance Committee, the next committee of referral. CHAIRMAN GREEN agreed with those comments because it was addressing a finance issue. REPRESENTATIVE ROKEBERG called for the question. REPRESENTATIVE BERKOWITZ withdrew his objection. There being no objection, CSSB 67(JUD) was reported out of committee. ADJOURNMENT Number 1625 There being nothing further to come before the committee, Chairman Green adjourned the House Judiciary Committee at 2:20 p.m.