05/07/2002 08:08 AM House STA

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* first hearing in first committee of referral
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ALASKA STATE LEGISLATURE HOUSE STATE AFFAIRS STANDING COMMITTEE May 7, 2002 8:08 a.m. MEMBERS PRESENT Representative John Coghill, Chair Representative Jeannette James Representative Hugh Fate Representative Gary Stevens Representative Peggy Wilson Representative Harry Crawford Representative Joe Hayes MEMBERS ABSENT All members present COMMITTEE CALENDAR HOUSE BILL NO. 324 "An Act making supplemental and other appropriations for homeland security; and providing for an effective date." - MOVED CSHB 324(STA) OUT OF COMMITTEE HOUSE BILL NO. 327 "An Act relating to state employees who are called to active duty as reserve or auxiliary members of the armed forces of the United States; and providing for an effective date." - MOVED CSHB 327(STA) OUT OF COMMITTEE CS FOR SENATE JOINT RESOLUTION NO. 43(STA)(title am) Requesting the United States Congress to grant a two-year moratorium on state maintenance of effort requirements for federally funded programs. - MOVED CSSJR 43(STA)(title am) OUT OF COMMITTEE PREVIOUS ACTION BILL: HB 324 SHORT TITLE:HOMELAND SECURITY APPROPRIATIONS SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR Jrn-Date Jrn-Page Action 01/16/02 1972 (H) READ THE FIRST TIME - REFERRALS

01/16/02 1972 (H) MLV, STA, FIN

01/16/02 1972 (H) GOVERNOR'S TRANSMITTAL LETTER

01/16/02 1972 (H) SPREADSHEET BY DEPT. COST 02/12/02 (H) MLV AT 3:00 PM CAPITOL 124 02/12/02 (H) Heard & Held 02/12/02 (H) MINUTE(MLV) 02/19/02 (H) MLV AT 3:00 PM CAPITOL 124 02/19/02 (H) Heard & Held 02/19/02 (H) MINUTE(MLV) 02/21/02 (H) MLV AT 3:00 PM CAPITOL 124 02/21/02 (H) Heard & Held 02/21/02 (H) MINUTE(MLV) 02/26/02 (H) MLV AT 3:00 PM CAPITOL 124 02/26/02 (H) Heard & Held 02/26/02 (H) MINUTE(MLV) 02/28/02 (H) MLV AT 3:00 PM CAPITOL 124 02/28/02 (H) -- Meeting Canceled -- 03/05/02 (H) MLV AT 3:00 PM CAPITOL 124 03/05/02 (H) Heard & Held 03/05/02 (H) MINUTE(MLV) 03/14/02 (H) MLV AT 3:00 PM CAPITOL 124 03/14/02 (H) Heard & Held 03/14/02 (H) MINUTE(MLV) 03/21/02 (H) MLV AT 3:00 PM CAPITOL 124 03/21/02 (H) -- Meeting Canceled -- 03/26/02 (H) MLV AT 3:00 PM CAPITOL 124 03/26/02 (H) Heard & Held 03/26/02 (H) MINUTE(MLV) 04/18/02 (H) MLV AT 3:00 PM CAPITOL 124 04/18/02 (H) Moved CSHB 324(MLV) Out of Committee 04/18/02 (H) MINUTE(MLV) 04/19/02 3028 (H) MLV RPT CS(MLV) 2DP 2NR 04/19/02 3028 (H) DP: GREEN, CHENAULT; NR: MURKOWSKI, 04/19/02 3028 (H) KOTT 04/19/02 3028 (H) LETTER OF INTENT WITH MLV REPORT 05/02/02 (H) STA AT 8:00 AM CAPITOL 102 05/02/02 (H) Heard & Held 05/02/02 (H) MINUTE(STA) 05/07/02 (H) STA AT 8:00 AM CAPITOL 102 BILL: HB 327 SHORT TITLE:STATE EMPLOYEES CALLED TO MILITARY DUTY SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR Jrn-Date Jrn-Page Action

01/16/02 1977 (H) READ THE FIRST TIME - REFERRALS

01/16/02 1977 (H) MLV, STA

01/16/02 1977 (H) FN1: ZERO(ADM/ALL DEPTS)

01/16/02 1977 (H) CHENAULT; BILL: SJR SHORT TITLE:MORATORIUM ON MAINTENANCE OF EFFORT SPONSOR(S): FINANCE Jrn-Date Jrn-Page Action REFERRALS Committee PHILLIPS; 532 Committee WILKEN, HOFFMAN, OLSON WITHDRAWN UNAN CONSENT Y14 N6 4/25 CALENDAR RECONSIDERATION AM) REFERRALS WITNESS REGISTER CAROL CARROLL, Director Central Office Administrative Services Division Department of Military & Veterans Affairs (DMVA) Juneau, Alaska 99811 POSITION STATEMENT: Testified that the DMVA would work further on this bill with the Finance Committee. NANCY SLAGLE, Director Division of Administrative Services Department of Transportation & Public Facilities Juneau, Alaska 99801 POSITION STATEMENT: Explained some of the department's funding requests on HB JAMO PARRISH, General Counsel University of Alaska Fairbanks PO Box 757520 Fairbanks, Alaska 99775 POSITION STATEMENT: Testified on HB Number 0070 CHAIR COGHILL announced that the first order of business would be HOUSE BILL NO. 324, "An Act making supplemental and other appropriations for homeland security; and providing for an effective date." CHAIR COGHILL asked if there was any objection to adopting the proposed committee substitute (CS) for HB Number 1089 CHAIR COGHILL announced that the next order of business would be HOUSE BILL NO. 327, "An Act relating to state employees who are called to active duty as reserve or auxiliary members of the armed forces of the United States; and providing for an effective date." Number 1150 REPRESENTATIVE FATE said the issue was raised at the last hearing whether or not the University of Alaska employees were to be lumped with other agency or department employees. There is a letter from the Office of the Attorney General which says what the constitution says, which is that the university board of regents will simply comply with law. He understands that statute law at the present time says that the university will determine what the compensation is for its employees. Number 1247 JAMO PARRISH, General Counsel, University of Alaska Fairbanks, testified via teleconference. He clarified that the university does not oppose the principle of holding harmless, in terms of paying benefits, its employees who are called to active duty. His interest is in protecting the authority which is granted by the constitution to the board of regents to govern the university according to law, but not according to gubernatorial order. He said the precise issue he plans to address is whether the proposed committee substitute (CS) as currently drafted cured the separation of powers problem inherent in the original bill. He stated his opinion, despite [the opinion] of the attorney general's office, that it did not. Number 1320 MR. PARRISH told the members that the substitute bill changes only the form and not the substance. In either format the governor would be the one making the policy decision of whether or not to pay these benefits, and the university would have to follow the decision of the governor, not the decision of the legislature. The issue at stake is who is entitled to make the policy decision for the university when the legislature hasn't made it. He asked if it is the governor or the board of regents. MR. PARRISH agreed with Representative Fate that the authority to establish compensation is currently set by statute to be required to be within the purview of the board of regents. In his view, this current statutory allocation of authority consistent with the constitution should not be altered. If the bill were to require all state agencies and the university to pay benefits, he would not be here today. That would be a policy decision incorporated into law, which according to the constitution the university must follow. But neither the bill nor the proposed CS makes that policy decision. That being the case, the CS should leave the policy decision to the board of regents. There is as much of a problem with the CS as currently written as there would be if it reversed the roles. If it said the board of regents may authorize the payment of these benefits and pass regulations that other state agencies would have to follow, he guessed that the executive branch would be arguing that the legislature cannot pick someone outside of each agency's chain of command to make that decision for them. He said he thinks that argument would be correct. Number 1451 MR. PARRISH stated that the Supreme Court has said that the university cannot be allocated among the executive branch agencies. This is consistent with the wording of the grant of governing authority to the board of regents. The Supreme Court has also said that the state cannot put the property of the university into state parks without paying compensation. This is because the university is a constitutional corporation separate from other branches. In the words of the Supreme Court, the university is "an instrumentality of the sovereign, which enjoys in some limited respects a status which is co-equal rather than subordinate to that of the executive or the legislative arms of government." Number 1505 MR. PARRISH noted that there are three ways to cure the problem. One is to require in the bill that all branches of government pay the benefits. If the legislature made that decision, the university would have no argument. Two is to make the non- executive branch agencies' decision to go forward discretionary with each, changing "shall" to "may" on page 2, is to pull the university entirely out of the bill and let the board of regents make its own decision to pay these benefits, which he expects it would. Number 1570 ANN COURTNEY, Senior Attorney, Labor and Employment, Alaska Railroad Corporation, testified via teleconference. She indicated that the railroad does not have the constitutional problem that the university has, but it has a very similar delegation of power to the corporation to set wages and benefits and other terms and conditions of employment for its employees. The Alaska Railroad Corporation's enabling statute That statute provides that the board of directors for the Alaska Railroad Corporation shall manage and run the corporation. In turn, it provides the authority to hire railroad personnel and determine benefits and other terms and conditions of employment vested in the corporation. [Chair Coghill left the meeting and Vice Chair Fate was the acting chair.] Number 1655 REPRESENTATIVE JAMES agreed that it is inappropriate for the legislature to require the University of Alaska or the Alaska Railroad Corporation to respond to a governor's executive order. She asked what the rationale is for having the bill be determined by a governor's executive order as opposed to just making it a statutory requirement. Number 1698 DAVE STEWART, Personnel Manager, Central Office, Division of Personnel, Department of Administration, answered that the rationale was to allow some flexibility in determining which emergencies would be covered by administrative order and which benefits would be set if the actual level of compensation, level of coverage, or definition of emergency was established in statute; it would allow an opportunity perhaps to be missed if an emergency wasn't defined in the statute as being covered. Number 1763 REPRESENTATIVE JAMES commented she understood that, but said it seems to her that the policy is pretty much established in here and if it hasn't been, perhaps the policy ought to be established. If anyone is in the National Guard and is called up for active duty, which can happen any time under any kind of circumstances, it seems to her this could be established in statute as opposed to an executive order. If that was done, the university and the railroad could be left in. She would just as soon leave them out altogether and not even say "may" unless the committee wanted to say "are encouraged to". She indicated that she isn't interested in putting something in statute that gives the governor this broad authority to make all these people do whatever they're told to do. Number 1850 VICE CHAIR FATE said that he has seen litigation at the university occur before over matters that are not quite as important as this. He would not like to see either the university or the administration expend a tremendous amount of energy and resources trying to determine whether this is constitutional or not. He would not object to the word "may" but understands that the administration doesn't want that simple change. He would concur with Representative James, but at this point, he said, it is not clear to him whether this should be the vehicle rather than just a broad general piece of legislation that would produce the same result. Number 1908 REPRESENTATIVE WILSON referred to the letter from the Attorney General and said it was obvious this could be done. There is nothing that says it can't. These agencies just don't want to have somebody else to boss them around. The legislature is within its legal rights to do this. VICE CHAIR FATE said there was some disagreement by the general counsel of the university on the constitutionality. It would be contentious to the point where it might cause further precedence or come to litigation to stop further precedence. He doesn't want that. Number 1981 REPRESENTATIVE JAMES commented that she thought this was an area that could be challenged and that would cost. Her solution would be to amend the bill to take out the application to other agencies entirely. That would make a lot of sense when talking about the power of the governor. Maybe the legislature gave the power to the governor, but she questioned how much power it wants to give the governor. She commented that she might yield to the "shall". She would just as soon not address this at all and let the various agencies address it on their own, which she said she believes they will do in the same way. VICE CHAIR FATE asked Mr. Stewart if the administration would be amenable to the amendment. Number 2109 MR. STEWART replied that when work was begun on this bill no one thought that issues and terms in it would be viewed as trammeling individual agency rights, responsibility, or sovereignty. The National Guard is playing a larger and larger role in national military responsibilities with the military having responsibilities elsewhere outside the borders of the country. Keeping the guard staffed has been the purview and responsibility and an objective of the Department of Military & Veterans Affairs and the governor. Maintaining benefits and income levels for members of the National Guard was seen as an opportunity to maintain that membership and build the membership to a point where the state felt comfortable. It is believed that the proposal in this bill is the right thing to do. The governor wants to do this for members of the executive branch who are called to active military service. It lies with the legislature to determine whether that affects all state agencies or just the executive branch. In an effort to get what is wanted, he said he wasn't sure that the administration would oppose that amendment at all. MR. STEWART indicated that it is the objective of the administration to have all state employees treated equally. If the amendment passes and allows individual choices from the other agencies, then do it. Number 2210 REPRESENTATIVE WILSON stated that the governor of Alaska probably has more power than any other governor in the United States. She cautioned the members about giving the governor any more power. VICE CHAIR FATE asked Mr. Parrish and Ms. Courtney if the amendment would satisfy the concerns of the university and the railroad. Number 2261 MR. PARRISH and MS. COURTNEY agreed that it would. Number 2319 REPRESENTATIVE JAMES made a motion to adopt a conceptual amendment, "lines 22 to 29 of Version C, delete that section AS 39.20.452.". adopted. Number 2339 REPRESENTATIVE JAMES moved to report SJR Number 2380 VICE CHAIR FATE announced that the final order of business would be CS FOR SENATE JOINT RESOLUTION NO. 43(STA)(title am), Requesting the United States Congress to grant a two-year moratorium on state maintenance of effort requirements for federally funded programs. [There was a motion to adopt 43(STA)(title am) Standing Committee. ADJOURNMENT Number 2778 There being no further business before the committee, the House State Affairs Standing Committee meeting was adjourned at 9:04 a.m.

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05/07/2002 08:08 AM House STA

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