Legislature(2017 - 2018)Anch LIO Conf Rm

07/25/2017 09:30 AM Senate LEGISLATIVE BUDGET & AUDIT


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09:46:19 AM Start
09:47:46 AM Approval of Agenda
09:47:59 AM Approval of Minutes
09:48:55 AM Revised Program Legislative (rpls)
09:57:31 AM Executive Session
11:57:11 AM Preliminary Audit Reports
11:58:56 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ RPL 06-8-0716 Office of Children's Services, TELECONFERENCED
Front Line Social Workers
+ Preliminary Audit Reports - EXECUTIVE SESSION TELECONFERENCED
a. Real Estate Commission (Sunset)
b. Board of Marital and Family Therapy (Sunset)
c. Board of Professional Counselors (Sunset)
d. FY 16 Single Audit
                    ALASKA STATE LEGISLATURE                                                                                  
             LEGISLATIVE BUDGET AND AUDIT COMMITTEE                                                                           
                       Anchorage, Alaska                                                                                        
                         July 25, 2017                                                                                          
                           9:46 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Gary Stevens, Chair                                                                                                     
Senator Cathy Giessel (via teleconference)                                                                                      
Senator Lyman Hoffman                                                                                                           
Senator Natasha von Imhof (alternate)                                                                                           
                                                                                                                                
Representative Andy Josephson, Vice Chair                                                                                       
Representative Scott Kawasaki (via teleconference)                                                                              
Representative Paul Seaton                                                                                                      
Representative Ivy Spohnholz                                                                                                    
Representative Jennifer Johnston (via teleconference)                                                                           
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Anna MacKinnon                                                                                                          
Senator Click Bishop                                                                                                            
                                                                                                                                
Representative Dan Ortiz (alternate)                                                                                            
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
APPROVAL OF AGENDA                                                                                                              
APPROVAL OF MINUTES                                                                                                             
REVISED PROGRAM LEGISLATIVE (RPLs)                                                                                              
EXECUTIVE SESSION                                                                                                               
PRELIMINARY AUDIT REPORTS                                                                                                       
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
No previous action to record                                                                                                    
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
SHAWNDA O'BRIEN, Assistant Commissioner                                                                                         
Department of Health and Social Services (DHSS)                                                                                 
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified during the discussion of RPL 06-                                                               
7-0716.                                                                                                                         
                                                                                                                                
AMANDA RYDER, Fiscal Analyst                                                                                                    
Division of Legislative Finance                                                                                                 
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Testified during the discussion  of RPL 06-                                                             
7-0716.                                                                                                                         
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
9:46:19 AM                                                                                                                    
                                                                                                                                
CHAIR  GARY  STEVENS  called the  Legislative  Budget  and  Audit                                                             
Committee meeting to order at  9:46 a.m. Representatives Kawasaki                                                               
(via   teleconference),   Seaton,    Spohnholz,   Johnston   (via                                                               
teleconference),   and  Josephson   and  Senators   Giessel  (via                                                               
teleconference),  Hoffman,  von  Imhof (alternate),  and  Stevens                                                               
were present at the call to order.                                                                                              
                                                                                                                                
^APPROVAL OF AGENDA                                                                                                             
                       APPROVAL OF AGENDA                                                                                   
                                                                                                                              
9:47:46 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  moved that  the Legislative  Budget and                                                               
Audit Committee  approve the agenda.   There being  no objection,                                                               
the agenda was approved.                                                                                                        
                                                                                                                                
^APPROVAL OF MINUTES                                                                                                            
                      APPROVAL OF MINUTES                                                                                   
                                                                                                                              
9:47:59 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  moved that  the Legislative  Budget and                                                               
Audit Committee approve  the minutes of the May  8, 2017, meeting                                                               
as presented.                                                                                                                   
                                                                                                                                
REPRESENTATIVE SPOHNHOLZ noted that at  the time stamp of 4:44:06                                                               
PM, the  minutes reflect incorrectly  that she returned  after an                                                               
at-ease as  the meeting was  in progress,  while in fact  she was                                                               
there from the  start of that call back to  order.  She suggested                                                               
that she may have been on mute [when the roll was called].                                                                      
                                                                                                                                
CHAIR  STEVENS  announced  that there  being  no  objection,  the                                                               
minutes as prepared, with that one correction, were approved.                                                                   
                                                                                                                                
^REVISED PROGRAM LEGISLATIVE (RPLs)                                                                                             
               REVISED PROGRAM LEGISLATIVE (RPLs)                                                                           
                                                                                                                              
9:48:55 AM                                                                                                                    
                                                                                                                                
CHAIR STEVENS  announced that the  first order of  business would                                                               
be  RPL  06-7-0716, Department  of  Health  and Social  Services,                                                               
Office of Children's Services, Front Line Social Workers.                                                                       
                                                                                                                                
9:49:07 AM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease at 9:49 a.m.                                                                                 
                                                                                                                                
9:50:54 AM                                                                                                                    
                                                                                                                                
SHAWNDA  O'BRIEN, Assistant  Commissioner,  Department of  Health                                                               
and  Social   Services  (DHSS),   advised  that  the   Office  of                                                               
Children's Services  in DHSS,  through its  efforts to  amend its                                                               
cost allocation plan in both this  and the last fiscal years, has                                                               
been  successful in  increasing its  administrative claiming  for                                                               
its frontline  social workers  component.   She reported  that in                                                               
getting approval  through its cognizant  agency in May  2017, the                                                               
department was able  to do the analysis necessary  to address the                                                               
additional federal  claiming potential  for the department.   She                                                               
explained  that  because  of  the timing  of  the  approval,  the                                                               
department was  not able  to conduct the  analysis earlier.   She                                                               
said the department is now  presenting its request for additional                                                               
federal authority  for fiscal year  2017 (FY 17), for  the amount                                                               
of  $6.5 million  in  federal receipt  authority.   Further,  the                                                               
department anticipates that the  potential claiming will increase                                                               
in  FY  18.     Currently,  the  department   estimates  only  an                                                               
additional $8 million in federal authority.                                                                                     
                                                                                                                                
MS. O'BRIEN  said the RPL  packet shows projected costs  and more                                                               
detail  explaining the  process, what  is attributed  to updating                                                               
the cost  allocation plan, and  where the department  sees itself                                                               
"landing."   She drew attention  to page  2 of the  packet, which                                                               
shows that  the receipt authority  is budgeted based on  what the                                                               
department knew at  the time it did the RPL  request and where it                                                               
projects its estimated expenditures going  forward.  She said the                                                               
department is still working to  get through its year-end closeout                                                               
process;   therefore,  it   anticipates   there   will  be   some                                                               
adjustments needed for expenditures that end FY 17.                                                                             
                                                                                                                                
9:53:30 AM                                                                                                                    
                                                                                                                                
AMANDA RYDER,  Fiscal Analyst,  Division of  Legislative Finance,                                                               
Alaska  State Legislature,  emphasized that  [DHSS] is  receiving                                                               
$8.1  million  in  additional federal  receipts,  and  only  $6.5                                                               
million   is  requested,   because   there   is  excess   federal                                                               
authorization  in  other allocations.    She  added, "This  is  a                                                               
supplemental for [FY]  17, and we can expect something  for FY 18                                                               
in the future - in next session."                                                                                               
                                                                                                                                
9:54:17 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  asked, "Since this  is coming in  so late,                                                               
is there  any lapsing authority here  for [FY] 17 or  is this all                                                               
taken care of?"                                                                                                                 
                                                                                                                                
9:54:35 AM                                                                                                                    
                                                                                                                                
MS. O'BRIEN answered  that the division is  not anticipating that                                                               
there will be  any lapsing general funds (GFs) for  FY 17 because                                                               
of  the  increased costs  it  has  experienced  in the  realm  of                                                               
expenditures  for  special needs,  specifically.    She said  the                                                               
division is hoping  that in FY 18 there may  be the potential for                                                               
a  lapsing  GF.    She  explained  the  ultimate  intent  of  the                                                               
department in  doing the amendment  was to  be able to  offset GF                                                               
expenditures with  the federal authority  increase, and  it fully                                                               
anticipates that that will eventually happen.                                                                                   
                                                                                                                                
9:55:27 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  moved that  the Legislative  Budget and                                                               
Audit Committee  approve RPL 06-7-0716  Department of  Health and                                                               
Social  Services,  Office  of  Children's  Services,  Front  Line                                                               
Social Workers,  $6,500,000 Federal Receipts, Fund  Code 1002, as                                                               
a supplemental FY 17 operating budget item.                                                                                     
                                                                                                                                
9:55:50 AM                                                                                                                    
                                                                                                                                
A roll  call vote was  taken.  Representatives  Kawasaki, Seaton,                                                               
Spohnholz,   Johnston,  and   Josephson  and   Senators  Giessel,                                                               
Hoffman, and Stevens voted in favor  of the approval of RPL 06-7-                                                               
0716.  Therefore, the motion passed by a vote of 8-0.                                                                           
                                                                                                                                
^EXECUTIVE SESSION                                                                                                              
                       EXECUTIVE SESSION                                                                                    
                                                                                                                              
9:57:31 AM                                                                                                                    
                                                                                                                                
CHAIR STEVENS announced that the  next order of business would be                                                               
an executive session.                                                                                                           
                                                                                                                                
9:57:40 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  moved that  the Legislative  Budget and                                                               
Audit go  into Executive  Session under Uniform  Rule 22  for the                                                               
purpose  of  discussing  confidential   audit  reports  under  AS                                                               
24.20.301.   He asked  that the  following individuals  remain in                                                               
the room or online:   Kris Curtis, Brian Blackwell, Mark Lundahl,                                                               
Dawn Borjesson,  and Linda  Day, and  he invited  any legislators                                                               
not  on  the  Legislative  Budget and  Audit  Committee  and  any                                                               
legislative staff working for committee members to remain.                                                                      
                                                                                                                                
9:57:43 AM                                                                                                                    
                                                                                                                                
CHAIR  STEVENS  advised that  hearing  no  objection, it  was  so                                                               
ordered.                                                                                                                        
                                                                                                                                
9:58:30 AM                                                                                                                    
                                                                                                                                
The committee  took an at-ease from  9:58 a.m. to 11:56  a.m. for                                                               
the purpose of an executive session.                                                                                            
                                                                                                                                
11:55:51 AM                                                                                                                   
                                                                                                                                
CHAIR STEVENS brought the Legislative  Budget and Audit Committee                                                               
back to  order at  11:56 a.m.  and announced  that no  action was                                                               
taken  during the  executive session.   Representatives  Kawasaki                                                               
(via teleconference), Seaton,  Johnston (via teleconference), and                                                               
Josephson  and Senators  Giessel  (via teleconference),  Hoffman,                                                               
and Stevens were present at the call back to order.                                                                             
                                                                                                                                
^PRELIMINARY AUDIT REPORTS                                                                                                      
                   PRELIMINARY AUDIT REPORTS                                                                                
                                                                                                                              
11:57:11 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  made  a motion  that  the  Legislative                                                               
Budget  and Audit  Committee  release  the following  preliminary                                                               
audits to  the appropriate  agencies for  response:   Real Estate                                                               
Commission  Sunset Audit,  Board  of Marital  and Family  Therapy                                                               
Sunset Audit, Board of Professional  Counselors Sunset Audit, and                                                               
FY 16 Single Audit.                                                                                                             
                                                                                                                                
11:57:36 AM                                                                                                                   
                                                                                                                                
A roll  call vote was  taken.  Representatives  Kawasaki, Seaton,                                                               
Johnston,  and  Josephson,  and Senators  Giessel,  Hoffman,  and                                                               
Stevens  voted in  favor of  releasing  the above  audits to  the                                                               
appropriate agencies for response.   Therefore, the motion passed                                                               
by a vote of 7-0.                                                                                                               
                                                                                                                                
CHAIR STEVENS  noted that the  committee would meet,  possibly in                                                               
September, to  release the FY 16  single audit.  He  advised that                                                               
the three oil and gas  consultants have completed their models as                                                               
required in  their contracts.   He indicated  a meeting  would be                                                               
scheduled in the  near future for the consultants  to explain and                                                               
offer a comparison of the three models.                                                                                         
                                                                                                                                
11:58:56 AM                                                                                                                   
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There  being  no  further  business  before  the  committee,  the                                                               
Legislative Budget  and Audit Committee meeting  was adjourned at                                                               
11:59 a.m.                                                                                                                      

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