Legislature(1993 - 1994)

03/22/1994 08:00 AM House STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                         March 22, 1994                                        
                            8:00 a.m.                                          
                                                                               
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
  Representative Al Vezey, Chairman                                            
  Representative Pete Kott, Vice Chairman                                      
  Representative Bettye Davis                                                  
  Representative Gary Davis                                                    
  Representative Harley Olberg                                                 
  Representative Jerry Sanders                                                 
  Representative Fran Ulmer                                                    
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
  None                                                                         
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
  *HB 482:       "An Act making permanent a temporary                          
                 requirement relating to the provision of                      
                 employment information to the state."                         
                                                                               
                 HELD OVER                                                     
                                                                               
                                                                               
  *HB 513:       "An Act relating to financial assistance for                  
                 certain owners or operators of underground                    
                 petroleum storage tank systems; and providing                 
                 for an effective date."                                       
                                                                               
                 CSHB 513 PASSED OUT                                           
                                                                               
                                                                               
  *HB 481:       "An Act relating to audits of recipients of                   
                 grants and of certain other financial                         
                 assistance from state agencies."                              
                                                                               
                 NOT HEARD                                                     
                                                                               
  WITNESS REGISTER                                                             
                                                                               
  REPRESENTATIVE MARK HANLEY                                                   
  Alaska State Legislature                                                     
  Alaska State Capitol, Room 515                                               
  Juneau, AK  99811-0460                                                       
  Phone:  465-4939                                                             
  POSITION STATEMENT:  Prime sponsor of HB 482                                 
                                                                               
  JOHN MALLONEE, Deputy Director                                               
  Child Support Enforcement Division                                           
  Department of Revenue                                                        
  P.O. Box 400100                                                              
  Juneau, AK  99811                                                            
  Phone:  465-4880                                                             
  POSITION STATEMENT:  Supported HB 482                                        
                                                                               
  JOHN BARNETT, Executive Director                                             
  Board of Storage Tank Assistance                                             
  410 Willoughby                                                               
  Juneau, AK  99801                                                            
  Phone:  465-5219                                                             
  POSITION STATEMENT:  Addressed HB 513                                        
                                                                               
  PREVIOUS ACTION                                                              
                                                                               
  BILL:  HB 482                                                                
  SHORT TITLE: EMPLOYMENT INFO PROVIDED TO THE STATE                           
  SPONSOR(S): REPRESENTATIVE(S) HANLEY,Ulmer                                   
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  02/14/94      2377    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/14/94      2377    (H)   STATE AFFAIRS                                    
  03/15/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  03/22/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  BILL:  HB 513                                                                
  SHORT TITLE: GRANTS/LOANS FOR STORAGE TANK OWNERS                            
  SPONSOR(S): LABOR & COMMERCE                                                 
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  02/28/94      2551    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/28/94      2551    (H)   L&C, STATE AFFAIRS, JUDICIARY                    
  03/02/94      2586    (H)   L&C REFERRAL WAIVED                              
  03/15/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  03/22/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  BILL:  HB 481                                                                
  SHORT TITLE: AUDITS OF STATE GRANT & AID RECIPIENTS                          
  SPONSOR(S): REPRESENTATIVE(S) BUNDE                                          
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  02/14/94      2377    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/14/94      2377    (H)   STATE AFFAIRS, FINANCE                           
  03/15/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  03/22/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 94-36, SIDE A                                                           
  Number 000                                                                   
                                                                               
  CHAIRMAN AL VEZEY called the meeting to order at 8:00 a.m.                   
  Members present were REPRESENTATIVES SANDERS, G. DAVIS,                      
  OLBERG, B. DAVIS and ULMER.  A quorum was present.                           
  CHAIRMAN VEZEY announced the sponsor of HB 481,                              
  REPRESENTATIVE BUNDE, had requested it be postponed.                         
  CHAIR VEZEY had anticipated moving HB 238; however, it was                   
  delayed in House Resources so it was postponed.                              
  HB 482 - EMPLOYMENT INFORMATION PROVIDED TO THE STATE                        
                                                                               
  CHAIRMAN VEZEY opened HB 482 for discussion.                                 
                                                                               
  Number 032                                                                   
                                                                               
  REPRESENTATIVE MARK HANLEY, prime sponsor, addressed HB 482.                 
  He said, in 1991, REPRESENTATIVE FRAN ULMER sponsored a bill                 
  which would require employers of 20+ employees to submit                     
  monthly reports to the Child Support Enforcement Authority                   
  (CSED) to help find those people not paying their child                      
  support.  The intent of this bill was to collect more child                  
  support payments, and it was successful.  The actual results                 
  of the bill were substantially higher than those estimated                   
  in its passage, he stated.  He explained a sunset clause,                    
  ending January 1, 1995, was included in this bill and the                    
  intent of HB 482 is to repeal it.                                            
                                                                               
  REPRESENTATIVE HANLEY outlined the old law was in one                        
  section and the new law was in another; therefore HB 482                     
  would provide two effective dates.   One date for the new                    
  section, and the old law would go into effect on January 1,                  
  1995, at the same time the new law is repealed from the                      
  statute.                                                                     
                                                                               
  REPRESENTATIVE HANLEY emphasized he had also been skeptical                  
  about the burden of the original bill, but in talking to                     
  larger companies they have not felt it to be overly                          
  burdensome and the results of the additional collections                     
  have been positive.                                                          
                                                                               
  REPRESENTATIVE HANLEY emphasized the more money contributed                  
  to child support, means less payments the state has to make                  
  in aid to families with many children.  When families are                    
  receiving child support they usually are receiving enough                    
  money, whereby they do not need to utilize state services.                   
                                                                               
  Number 099                                                                   
                                                                               
  REPRESENTATIVE HARLEY OLBERG stated 50 percent goes to the                   
  general fund.  He asked if the rest of the money goes to                     
  program receipts.                                                            
                                                                               
  Number 104                                                                   
                                                                               
  REPRESENTATIVE HANLEY deferred the question to the next                      
  witness.                                                                     
                                                                               
  Number 109                                                                   
                                                                               
  CHAIRMAN VEZEY introduced JOHN MALLONEE as the next                          
  individual to testify.                                                       
                                                                               
  Number 119                                                                   
                                                                               
  JOHN MALLONEE, DEPUTY DIRECTOR, CHILD SUPPORT ENFORCEMENT                    
  DIVISION, DEPARTMENT OF REVENUE, supported HB 482.  He                       
  responded to CHAIRMAN VEZEY's previous question stating the                  
  CSED collects child support money if it is reimbursement for                 
  Aid for Families with Dependent Children (AFDC).  He stated                  
  50 percent goes to the general fund and 50 percent goes to                   
  reimburse the share that AFDC paid.                                          
                                                                               
  Number 132                                                                   
                                                                               
  CHAIRMAN VEZEY stated the money was child support money, not                 
  AFDC money.                                                                  
                                                                               
  Number 136                                                                   
                                                                               
  MR. MALLONEE clarified once a family goes on AFDC, they sign                 
  over their rights to their child support to the state, up to                 
  the amount which they are given grants by AFDC.                              
                                                                               
  Number 140                                                                   
                                                                               
  CHAIRMAN VEZEY responded not everyone involved in the                        
  program goes on AFDC.                                                        
                                                                               
  Number 141                                                                   
                                                                               
  MR. MALLONEE agreed, money is collected and directly given                   
  to  those families who do not go on AFDC in the attempt to                   
  keep them off AFDC.                                                          
                                                                               
  Number 144                                                                   
                                                                               
  CHAIRMAN VEZEY commented the program is experimental and is                  
  set up to affect employers who employ more than 20 people by                 
  giving them a monthly reporting requirement.  In practice,                   
  the program has been implemented on selected employers of 50                 
  or more.  He felt if HB 481 were to pass, the base of                        
  employers would expand.                                                      
                                                                               
  Number 152                                                                   
                                                                               
  MR. MALLONEE replied HB 482 can be expanded down to include                  
  all employers who employ at least 20 individuals.                            
                                                                               
  Number 155                                                                   
                                                                               
  CHAIRMAN VEZEY stated all the employers he had talked to                     
  indicated the report takes three or more hours to complete                   
  every month.                                                                 
                                                                               
  Number 158                                                                   
                                                                               
  MR. MALLONEE responded he found that estimation hard to                      
  believe.  As an accountant, he did not feel information that                 
  was readily available on a W-4 or an I-9 would take three or                 
  more hours to access on a monthly basis.  The whole                          
  requirement of actually withholding, which employers are                     
  already required to do whether or not the current law                        
  sunsets, may take three or more hours depending upon the                     
  size of the company.                                                         
                                                                               
  Number 171                                                                   
                                                                               
  CHAIRMAN VEZEY stated the biggest problem employers have is                  
  knowing who to withhold from.  Statute holds the employer in                 
  perpetuity for an employee's withholding order.  Records                     
  must by kept on all past employees.                                          
                                                                               
  Number 182                                                                   
                                                                               
  MR. MALLONEE assumed CHAIRMAN VEZEY was referring to the                     
  requirement, whereby once a withholding order is delivered                   
  to an employer, if that employee leaves and later returns,                   
  that withholding order has not been satisfied.                               
                                                                               
  Number 186                                                                   
                                                                               
  CHAIRMAN VEZEY felt this requirement would cost the employer                 
  the most time to search through the records.                                 
                                                                               
  Number 189                                                                   
                                                                               
  REPRESENTATIVE OLBERG asked if previous legislation had been                 
  heard dealing with that requirement.                                         
                                                                               
  CHAIRMAN VEZEY answered similar legislation was before the                   
  Health, Education & Social Services Committee recently;                      
  however, it dealt with a different statute and only had                      
  similar language.                                                            
                                                                               
  CHAIRMAN VEZEY felt there were problems with the current                     
  child support statutes.  He stated, after talking with                       
  employers, the aspect of working with CSED that bothers them                 
  the most is the unknown liability of having to keep track of                 
  every employee they have ever had.  He asked if a more                       
  reasonable process could be found for the employers.                         
                                                                               
  Number 205                                                                   
                                                                               
  MR. MALLONEE replied the process was not unreasonable,                       
  because an employer is already required to keep employee                     
  records for several years after their employment, e.g., IRS,                 
  employee reporting records, tax records, etc..  He noted if                  
  there is some question to the records, they may never be                     
  subject to a statute of limitations.                                         
                                                                               
  Number 214                                                                   
                                                                               
  CHAIRMAN VEZEY commented he was not aware of that as an                      
  employer.                                                                    
                                                                               
  Number 217                                                                   
                                                                               
  MR. MALLONEE stated the CSED did not want to put an unfair                   
  burden on employers.  Employers argue the CSED has the                       
  records available through Department of Labor reporting.                     
  This is true, but the CSED cannot access the records until                   
  four months after the fact.  He emphasized that an                           
  individual working in Alaska over the summer, is already                     
  gone four months after the fact.                                             
                                                                               
  Number 230                                                                   
                                                                               
  CHAIRMAN VEZEY inquired if the broadest scope of information                 
  would come from hiring dispatch halls.                                       
                                                                               
  MR. MALLONEE answered information has also been obtained                     
  from those sources.                                                          
                                                                               
  Number 237                                                                   
                                                                               
  CHAIRMAN VEZEY asked if statute required the dispatch halls                  
  to give the CSED information.                                                
                                                                               
  Number 238                                                                   
                                                                               
  MR. MALLONEE said he would have to check the statutes for                    
  its location, but the CSED had, in fact, issued items to                     
  union halls.                                                                 
                                                                               
  Number 243                                                                   
                                                                               
  REPRESENTATIVE FRAN ULMER assumed the Department of Revenue                  
  would like to continue the program.                                          
                                                                               
  Number 244                                                                   
                                                                               
  MR. MALLONEE affirmed REPRESENTATIVE ULMER, and reinforced                   
  that the program had brought in a large amount of                            
  collections in the previous year.  The last report by an                     
  outside firm he had received about the program, indicated                    
  the difference between the control group and the target                      
  group was $621,000 last year.  Estimates in 1991 stated if                   
  the program was expanded to all employers, it could bring in                 
  as much as $7.5 million in addition to current collections.                  
                                                                               
  Number 258                                                                   
                                                                               
  CHAIRMAN VEZEY stated he would like hear back from MR.                       
  MALLONEE on some of the questions he had raised. HB 482 in                   
  was held in committee pending more information.                              
                                                                               
  HB 513 - GRANTS/LOANS FOR STORAGE TANK OWNERS                                
                                                                               
  CHAIRMAN VEZEY opened HB 513, sponsored by the House Labor &                 
  Commerce Committee, for discussion.                                          
                                                                               
  Number 272                                                                   
                                                                               
  JOHN BARNETT, EXECUTIVE DIRECTOR, BOARD OF STORAGE TANK                      
  ASSISTANTS, supported HB 513.  He stated the Board of                        
  Storage Tank Assistants is an appeal board that works with                   
  the Department of Environmental Conservation (DEC) to                        
  administer the storage tank assistance fund.  This program                   
  issues grants and loans to regulated underground storage                     
  tank owners throughout the state to help them offset the                     
  high cost of environmental compliance.                                       
                                                                               
  MR. BARNETT outlined the sections of HB 513.  Section 1                      
  clarifies the authority of the board to hear all eligibility                 
  appeals.  Existing statute allows the board to hear appeals                  
  on eligible costs, but the board has about 150 applicants                    
  that have been determined completely ineligible.  He noted                   
  several of these applicants feel they were determined                        
  ineligible based on an interpretive decision by DEC, based                   
  on a policy which may be inconsistent with the original                      
  intent of the program.  He stated these owners would like a                  
  sort of forum, where their concerns could be heard.                          
                                                                               
  MR. BARNETT stated Section 2 of HB 513, corrects an                          
  oversight in the original bill.  The upgrade in closure                      
  program under current law does not have a sunset date.                       
  Section 2 would provide a sunset clause to the storage tank                  
  assistance fund closure and upgrade application period.  The                 
  sunset would be consistent with the cleanup application                      
  deadline.                                                                    
                                                                               
  MR. BARNETT stated Section 3 of HB 513, allows upgrade in                    
  closure applicants still waiting to be funded, to continue                   
  to be eligible for financial assistance for cleanup, after                   
  the cleanup deadline passes.  He noted they had expected to                  
  fund all of the closure and upgrades several years ago;                      
  however, at this time over 400 applicants exist that will                    
  not discover petroleum contamination until after the cleanup                 
  application sunsets.  Applicants will be eligible for                        
  cleanup as long as they are already on the list.                             
                                                                               
  Number 347                                                                   
                                                                               
  CHAIRMAN VEZEY asked what would happen if HB 513 did not                     
  take effect until October 1, 1994.                                           
                                                                               
  MR. BARNETT answered the date was originally proposed to be                  
  consistent with current law, July 1, 1994.  He stated the                    
  board would support any amendments to allow for the                          
  applicants to be notified.                                                   
                                                                               
  Number 355                                                                   
                                                                               
  CHAIRMAN VEZEY noted a two-thirds vote would be necessary to                 
  establish an effective date.                                                 
                                                                               
  Number 358                                                                   
                                                                               
  MR. BARNETT clarified he was referring to Section 2, where                   
  the application for assistance must be submitted before July                 
  1, 1994.                                                                     
                                                                               
  Number 362                                                                   
                                                                               
  CHAIRMAN VEZEY asked how HB 513 clarifies the relationship                   
  between the board and the DEC.                                               
                                                                               
  MR. BARNETT answered the board has applicants who have been                  
  denied any financial assistance whatsoever.  For example,                    
  failure to report a release when, in fact, they had already                  
  bought a facility that was already contaminated.  Existing                   
  statute includes language which refers to being in                           
  compliance with existing laws.  There is also language which                 
  provides for amnesty over a six month period once the                        
  applicant has registered their facility.  He emphasized DEC                  
  sometimes takes a very strict interpretive view of the                       
  statutes and regulations.  He gave an example of an                          
  applicant who, after noncompliance, came into compliance                     
  prior to the effective date of the original bill, but was                    
  still termed ineligible forever by the DEC.  He termed the                   
  DEC interpretation as "once a criminal, always a criminal."                  
  He felt the board should be able to help mediate the dispute                 
  so the objective of cleaning up the sights can be met.  The                  
  new section clarifies the requirements for a forum would be                  
  eligibility in general, not just costs.                                      
                                                                               
  Number 414                                                                   
                                                                               
  CHAIRMAN VEZEY clarified there was currently no appeal for a                 
  DEC decision and the new section would provide for one.                      
                                                                               
  MR. BARNETT affirmed CHAIRMAN VEZEY.                                         
                                                                               
  Number 419                                                                   
                                                                               
  CHAIRMAN VEZEY asked if a committee member would move to                     
  amend HB 513 whereas the date in Section 2 be amended from                   
  "July 1, 1994" to "December 31, 1994."                                       
                                                                               
  Number 428                                                                   
                                                                               
  REPRESENTATIVE OLBERG so moved.                                              
                                                                               
  Number 433                                                                   
                                                                               
  REPRESENTATIVE ULMER questioned if the change would                          
  significantly impact the number of people who have filed                     
  applications or impact the business of the board.                            
                                                                               
  MR. BARNETT answered the applicants were originally                          
  considered when the program began.  They had expected to                     
  have already funded them, but with the limitations in                        
  funding over the past three years they had fallen behind.                    
  The change would not provide impact that was not already                     
  considered from the original legislation.                                    
                                                                               
  Number 442                                                                   
                                                                               
  CHAIRMAN VEZEY asked the committee secretary to call the                     
  roll the amendment to HB 513.                                                
                                                                               
  IN FAVOR:      REPRESENTATIVES VEZEY, KOTT, ULMER, B. DAVIS,                 
                 G. DAVIS, SANDERS, OLBERG                                     
                                                                               
  CHAIRMAN VEZEY announced the amendment to HB 513 was                         
  adopted.                                                                     
                                                                               
  CHAIRMAN VEZEY asked if the dates would have to be adjusted                  
  in Section 3.                                                                
                                                                               
  Number 450                                                                   
                                                                               
  MR. BARNETT replied Section 3(a)(1) would have to be                         
  adjusted.                                                                    
                                                                               
  Number 453                                                                   
                                                                               
  CHAIRMAN VEZEY inquired about the date in Section 3,                         
  subsection 2.                                                                
                                                                               
  Number 454                                                                   
                                                                               
  MR. BARNETT responded Section 3, subsection 2, refers to a                   
  date currently in statute and is also consistent with the                    
  federal Environmental Protection Agency requirement.  He                     
  stated it should not be changed.                                             
                                                                               
  Number 457                                                                   
                                                                               
  CHAIRMAN VEZEY asked if REPRESENTATIVE OLBERG had a motion                   
  to change Section 3, line 9, from "July 1, 1994" to                          
  "December 31, 1994."                                                         
                                                                               
  Number 458                                                                   
                                                                               
  REPRESENTATIVE OLBERG so moved.                                              
                                                                               
  Number 463                                                                   
                                                                               
  CHAIRMAN VEZEY asked the committee secretary to call the                     
  roll.                                                                        
                                                                               
  IN FAVOR:      REPRESENTATIVES VEZEY, KOTT, ULMER, B. DAVIS,                 
                 G. DAVIS, SANDERS, OLBERG                                     
                                                                               
  CHAIRMAN VEZEY announced the second amendment to HB 513 had                  
  been adopted.                                                                
                                                                               
  Number 466                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS moved to adopt the committee                         
  substitute for HB 513 reflecting the amendments made by the                  
  committee.                                                                   
                                                                               
  CHAIRMAN VEZEY announced, hearing no opposition, the                         
  committee substitute for HB 513 had been adopted.                            
                                                                               
  Number 485                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS moved to pass CSHB 513 out of                        
  committee with individual recommendations and accompanying                   
  fiscal notes.                                                                
                                                                               
  Number 490                                                                   
                                                                               
  CHAIRMAN VEZEY asked the committee secretary to call the                     
  roll.                                                                        
                                                                               
  IN FAVOR:      REPRESENTATIVES VEZEY, KOTT, ULMER, B. DAVIS,                 
                 G. DAVIS, SANDERS, OLBERG.                                    
                                                                               
  CHAIRMAN VEZEY announced CSHB 513 had passed from the House                  
  State Affairs Committee.                                                     
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  CHAIRMAN VEZEY, having no more business before the                           
  committee, adjourned the meeting at 8:30 a.m.                                
                                                                               
  BILLS NOT HEARD                                                              
                                                                               
  HB 481 - AUDITS OF STATE GRANT & AID RECIPIENTS                              

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