Legislature(2025 - 2026)GRUENBERG 120
01/30/2025 03:15 PM House STATE AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| Overview: Wage Study | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE STATE AFFAIRS STANDING COMMITTEE
January 30, 2025
3:16 p.m.
MEMBERS PRESENT
Representative Ashley Carrick, Chair
Representative Andi Story, Vice Chair
Representative Rebecca Himschoot
Representative Ky Holland
Representative Sarah Vance
Representative Kevin McCabe
Representative Elexie Moore
MEMBERS ABSENT
All members present.
COMMITTEE CALENDAR
OVERVIEW: WAGE STUDY
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record.
WITNESS REGISTER
PAULA VRANA, Commissioner
Department of Administration
Juneau, Alaska
POSITION STATEMENT: Co-offered the wage study overview.
KATE SHEEHEN, Director
Division of Personnel and Labor Relations
Department of Administration
Juneau, Alaska
POSITION STATEMENT: Co-offered the wage study overview.
HEIDI DRYGAS, Executive Director
Alaska State Employees Association
Juneau, Alaska
POSITION STATEMENT: Gave invited testimony regarding the wage
study and its impact.
ACTION NARRATIVE
3:16:44 PM
CHAIR ASHLEY CARRICK called the House State Affairs Standing
Committee meeting to order at 3:16 p.m. Representatives Story,
Himschoot, Holland, McCabe, Moore, and Carrick were present at
the call to order. Representative Vance arrived as the meeting
was in progress.
^Overview: Wage Study
Overview: Wage Study
3:17:32 PM
CHAIR CARRICK announced that the first order of business would
be the wage study overview.
3:18:49 PM
PAULA VRANA, Commissioner, Department of Administration, co-
offered an overview via PowerPoint [hard copy included in the
committee file] of the current State of Alaska Wage Study. She
described that within the Department of Administration (DOA) is
the Division of Personnel and Labor Relations, which provides
policy, guidance, and direct human resource services for the
executive branch. She said that part of this role is to support
human resource strategies and help departments address workforce
challenges. She stated that like all states and private
sectors, recruitment and retention are an issue the state has
faced in the last years. In response to these challenges, the
2023 legislature appropriated $1 million for a statewide wage
study conducted by Seagal. She said the purpose of this study
is to gather data from employers and determine where Alaska's
salary and pay structure are relative to other employers. She
explained that the draft study initially had a deadline set for
June 30, 2024, but significant and relevant factors had changed
since the study commenced, including the passage of SB 259.
3:21:13 PM
The committee took a brief at-ease at 3:21 p.m.
3:21:25 PM
MS. VRANA continued the overview and elaborated about SB 259,
and other factors that impacted the original study. She said it
was determined that by excluding these factors, it would result
in data flaws and diminish the study's utility. As a result,
the deadline was extended, and Segal was asked to factor in
these adjustments to ensure the data is accurate. She explained
that accurate information is imperative because recommendations
from the study can substantially impact the state budget. She
said that due diligence dictated that Segal go back to the
drawing board. She noted that the final report will provide the
foundation for a robust discussion about next steps and options
for potential compensation adjustments. She explained that the
study is set to be released at the end of March.
3:23:17 PM
KATE SHEEHEN, Director, Division of Personnel and Labor
Relations, Department of Administration, co-offered an overview
via PowerPoint of the current State of Alaska Wage Study.
Beginning on Slide 3, she described the scope of the study and
its details. She noted that they were looking at job classes
and clarified the points of focus. She noted that the Division
of Personnel was not equipped to complete a study of this scale,
and this is what prompted the request to the legislature to
finance a study.
3:25:00 PM
MS. VRANA responded to a series of committee questions. She
remarked that performance concerns with the contractor are not a
concern, and that Segal is working through the Request for
Proposal (RFP) and operating under its guidance. She reiterated
that the delay is a response to the changes such as the passage
of SB 259. She responded that she does not believe that any
additional legislative support would be needed for the study.
She said that the peers mentioned on the overview referred to
peer jurisdictions. She remarked that the contractor had
challenges getting feedback from the jurisdictions and remarked
that it will be a combination of doubling down on getting
feedback and getting feedback from other jurisdictions to ensure
study accuracy.
MS. SHEEHEN responded to a series of committee questions. She
elaborated to why the governor asked for the study and noted
that a couple previous studies had been conducted in both 2009
and 2013. These studies provided previous elaboration on Alaska
pay and its comparisons, but position descriptions needed an
update, and a new study would provide greater insight into the
labor market. She noted that the 2009 benchmark study does not
account for necessary updates and while comparisons are similar,
both studies have different RFPs. She said that Segal was asked
to look at geographic differentials to account for different pay
scales relative to the area. She explained that Segal was
selected following the RFP submission and noted that Segal was
not the only contractor that responded to the RFP, but the
committee deemed them the most experienced and capable of doing
the requested work.
3:34:50 PM
MS. SHEEHEN on Slide 4, described the anticipated timeline of
the wage study report. She clarified the final report meaning
and how it corresponds to final decision making.
3:36:10 PM
MS. SHEEHEN responded to a series of committee questions. She
clarified that Segal uses certain data and puts reports together
for joint review. She reiterated that the final report is not
ready for practical utilization. She noted that once the
original report was formulated, not enough data points were
available to support a confident study and opined that the June
30 report was not accurate. She remarked that there was never
an identified final date, and the study was a multi-year
appropriation. Originally the contract with Segal ended June 30
but two contractual amendments had been made. She was unable to
specify any deadlines pertaining to the Office of the Governor
and Seagal's work pace, as she was not in every meeting with
Segal and would require more time to follow-up and respond. She
affirmed that the contract was amended twice and clarified that
the contract was for $800,000 and the division had a $200,000
budget surplus. She responded that she was not able to
determine how Segal was going to receive feedback from employers
that did not respond to study questions. She clarified that the
new expected date for the new study report was the end of March
and that it was not unusual for contracts to have extensions.
She also noted that the division is constantly in a state of
bargaining, and until an agreement is reached, the division
continues to work with the information available.
3:48:01 PM
The committee took an at-ease from 3:48 p.m. to 3:49 p.m.
3:49:49 PM
CHAIR CARRICK clarified documents for committee members and how
they pertained to the presentation.
3:51:05 PM
MS. SHEEHEN presented Slide 6 and the data updates. She
provided clarification on the $125,000,000 million costs
associated with the study.
3:52:15 PM
MS. VRANA responded to a series of committee questions. She
confirmed that much like the Department of Transportation
(DOT&PF) and work delays, the study had complications that
delayed the project. She acknowledged that Alaska has vacancy
problems much like other states and there was a sense of urgency
to complete the study. She responded that Segal is working
expeditiously to complete it. She said that that Segal
understands that the expectation is to deliver a completed study
by the end of March. She also responded to skepticism regarding
timelines and said that Segal is on track for a completion date.
She was unable to provide the reasons for a contract redaction
and would need to get back to committee members. Additionally,
she was not able to clarify the $80,000 payment for the 100
hours of work and would need more details to follow-up. She was
unable to provide a response to when the study would be
available for use.
MS. SHEEHEN answered a series of questions from committee
members. She said that she would need to contact Segal whether
an early delivery is possible. She also clarified that
retention and recruiting bonuses were not included in the study
because it would skew the data. She said that letters of
agreement depend on group and are done every fiscal year, and
including these numbers would skew the data. She stated that
the division meets regularly with Segal, monitors what data
points the division wants, and that Segal was told to be more
aggressive getting information from employers. She remarked
that currently the division is bargaining with seven unions and
that collective bargaining agreements end June 30. An agreement
with the union would be required for a roll-over. She said that
it was possible that collective bargaining could pause but an
issue is that a statute requires submissions by the sixtieth day
of session. She reaffirmed that the letters of agreement have
cancellation clauses and without vacancies those bonuses go away
and are technically not part of the salary. She remarked that
Alaska's vacancy rates are approximately 16.6 percent and out of
15 states studied, Alaska sits in the middle. She remarked that
information regarding vacancy rates can be delivered to
committee members and can provide elaboration on vacancies both
before and after bonuses. She explained that letters of
agreement are renewed every fiscal year and there are hundreds
of letters. She remarked that working through them takes time
and that letters of agreement are honored until they are denied.
4:22:48 PM
The committee took an at-ease from 4:22 p.m. to 4:32 p.m.
4:34:26 PM
HEIDI DRYGAS, Executive Director, Alaska State Employees
Association (ASEA), gave invited testimony regarding the wage
study and its impact. She discussed her work background and
ASEA. She noted that in September 2024, ASEA requested the
results of any salary study completed in the last six months.
She noted that the state delayed response and finally denied the
request in January 2025. She explained that recruitment and
retention is ASEA's biggest challenge. She raised concerns
about pay differentials between federal and state positions in
comparable fields.
4:36:58 PM
The committee took an at-ease from 4:36 p.m. to 4:40 p.m.
4:40:47 PM
MS. DRYGAS continued her testimony and explained why the salary
study matters to ASEA. She echoed Ms. Sheheen's statement that
the economic terms of the collective bargaining unit are due on
the sixtieth day of session and that the salary study is not
helpful when unavailable. She noted that ASEA represents
approximately 8,000 state employees. She raised concerns about
redacted information in the study and noted that the public was
interested in those details.
4:43:30 PM
MS. DRYGAS mentioned that there was an amendment for $80,000 and
100 staff hours. She asked why it was taking so long to get the
information and noted that Amendment 2 was signed in August
2024, and it was January 2025. She reiterated that bargaining
units need the study information to inform their contracts. She
remarked that the public does not understand the delay and the
details regarding the study are not transparent.
4:45:39 PM
MS. DRYGAS responded to a series of committee questions. She
remarked that ASEA would be open to looking at a memorandum of
understanding (MOU) but stressed that the legislature would need
time to act. She explained that ASEA does not have the
resources to conduct a salary study of this scale, and ASEA has
advocated for a study to be complete. She said that ASEA looks
at comparable factors, other jurisdictions, states, and
municipalities for study. She noted that every union is
different and ASEA does work to "cost out" proposals, but larger
studies are not feasible. She clarified that collective
bargaining agreements can't go more than three years, but they
are not always three. She was unable to say how often wage
studies are conducted but understood that the state was
responsible for conducting a geographical study every five
years. She opined that wage studies should be done more
frequently to ensure competitive wages. She noted that the last
salary study of this scale was not conducted since 2009 and was
unable to say whether it had experienced delays. Regarding how
the legislature framed the study, she opined that the
legislature started off on the right path given their proposed
deadlines but felt that an out-of-session meeting check-in may
be effective. She said it will serve the state to have wage
studies conducted regularly.
5:00:49 PM
MS. SHEEHEN responded to a series of questions from committee
members. She stated that the division received a study draft in
June but there is no draft for the final report. She stated
that the draft is privileged information and inaccessible. She
clarified that the Department of Law (DOL) is responsible for
redacting emails. She explained that once the final study
document is received, it will be posted on the DOA's website,
and staff will be available to help decipher the study. She
responded that she would need to get back to committee members
following a conversation with Segal regarding incentives and
letters of agreement. Additionally, she did not know whether
completed sections of the study could be released early but
would follow-up.
5:08:45 PM
ADJOURNMENT
There being no further business before the committee, the House
State Affairs Standing Committee meeting was adjourned at 5:09
p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 2025.01.30.HSTA.WageStudy.Presentation.pdf |
HSTA 1/30/2025 3:15:00 PM |
|
| Statewide Salary Study Amd 2.pdf |
HSTA 1/30/2025 3:15:00 PM |
|
| Statewide Salary Study Email Message 12-6-2024.pdf |
HSTA 1/30/2025 3:15:00 PM |