Legislature(1999 - 2000)
01/14/2000 08:07 AM Senate BUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
JOINT COMMITTEE ON LEGISLATIVE BUDGET AND AUDIT
January 14, 2000
8:07 a.m.
MEMBERS PRESENT
Representative Gail Phillips, Chair
Representative Con Bunde
Representative Eric Croft
Representative Gary Davis
Representative Gene Therriault
Representative Eldon Mulder (Alternate)
Senator Randy Phillips, Vice Chair
Senator Al Adams
Senator Rick Halford
Senator Gary Wilken
Senator Drue Pearce (Alternate)
MEMBERS ABSENT
Senator Sean Parnell
COMMITTEE CALENDAR
APPROVAL OF MINUTES
CONSIDERATION OF RPLs
EXECUTIVE SESSION
AUDIT REPORTS
REPORT FROM THE DENALI COMMISSION
OTHER COMMITTEE BUSINESS
ADJOURNMENT
WITNESS REGISTER
DAVID TEAL, Legislative Fiscal Analyst
Legislative Finance Division
Alaska State Legislature
P.O. Box 113200
Juneau, Alaska 99811
POSITION STATEMENT: Provided an explanation of the two RPLs up
for consideration.
TOM LAWSON, Director,
Division of Administrative Services
Department of Community and Economic Development (DCED)
P.O. Box 110803
Juneau, Alaska 99811
POSITION STATEMENT: Provided information on RPL 08-0-0101.
JANET CLARK, Director
Division of Administrative Services
Department of Health and Social Services (DHSS)
P.O. Box 110650
Juneau, Alaska 99811
POSITION STATEMENT: Provided information on RPL 06-0-0180.
MATT ANDERSON, Unit Manager
Community Health and Emergency Medical Services
Department of Health and Social Services
P.O. Box 110650
Juneau, Alaska 99811
POSITION STATEMENT: Provided information on RPL 06-0-0180.
KRAG JOHNSON, Legislative Coordinator
Denali Commission
510 L Street, Number 410
Anchorage, Alaska 99501
POSITION STATEMENT: Provided information on the Denali
Commission.
JEFF STASER, Co-Chairman
Denali Commission
510 L Street, Number 410
Anchorage, Alaska 99501
POSITION STATEMENT: Provided information on the Denali
Commission.
ACTION NARRATIVE
TAPE 00-1, SIDE A
Number 0001
CHAIR GAIL PHILLIPS called the Joint Committee on Legislative
Budget and Audit meeting to order at 8:07 a.m. Members present
at the call to order were Representatives Phillips, Bunde, Croft,
Davis and Therriault, and Senators Phillips and Wilken.
Representative Mulder and Senators Adams, Halford and Pearce
arrived after the call to order.
CHAIR PHILLIPS introduced her new committee staff, Pat Hartley
from Homer.
The following staff members from the Legislative Finance Division
introduced themselves: Ginger Blaisdell, Fiscal Analyst, who is
responsible for the Department of Health and Social Services
(DHSS) and the statewide operating budget; Rob Carpenter, Fiscal
Analyst, who is responsible for the Department of Law, the
Department of Public Safety, the Department of Corrections and
the Alaska Court System; Michael Crabb, Fiscal Analyst, who is
responsible for the University of Alaska, the Department of
Environmental Conservation (DEC) and the Department of Natural
Resources (DNR); Tracy Carpenter, Fiscal Analyst, who is
responsible for the capital budget and the Department of
Transportation (DOT); Amanda Ryder, Fiscal Analyst, who is
responsible for the Department of Community and Economic
Development (DCED), the Department of Military and Veterans
Affairs (DMVA), the Alaska Department of Fish and Game (ADF&G)
and the Department of Revenue (DOR). It was noted that Diana
Forbes (ph), not present, is responsible for the Department of
Administration and the Department of Labor and Workforce
Development.
APPROVAL OF MINUTES
CHAIR PHILLIPS indicated the first order of business would be the
approval of the minutes from the Legislative Budget and Audit
meeting held on December 16, 1999.
Number 0250
SENATOR PHILLIPS made a motion to approve the minutes from the
December 16, 1999, meeting.
CHAIR PHILLIPS asked whether there were any objections. There
being none, the minutes from the December 16, 1999, meeting were
approved as read.
CONSIDERATION OF RPLS (REVISED PROGRAM - LEGISLATIVE)
Number 0268
CHAIR PHILLIPS indicated the next order of business would be the
consideration of the RPLs. The first RPL under consideration was
08-0-0101/DCED Industry Network Corporation Grant.
Number 0312
DAVID TEAL, Legislative Fiscal Analyst, Legislative Finance
Division, Alaska State Legislature, explained that the RPL, 08-0-
0101, is a grant for $145,000 and contains two parts: one part
is for the forest products development specialist, and the second
is a grant intended to help match Alaska companies with overseas
buyers. Mr. Teal indicated there are a number of subparts; it
will fund some salaries and space, which currently are
obligations of the agency; it will also fund an Alaskan products
catalogue and provide some assistance to Alaskan companies. Mr.
Teal summarized by saying that it pays to do some things that the
DCED is already doing, because it will free up money to pay for
the forest products development specialist, which is in the first
part of the grant.
MR. TEAL pointed out that the Legislative Budget and Audit
Committee took up the RPL 08-0-0101 in the last meeting, on
December 16, 1999. He indicated some concerns were expressed.
The first was that cuts were made in these areas during the last
legislative session, but the Legislative Budget and Audit
Committee was not sure of the subcommittee's approval of those
cuts. Second, there was a formal memorandum written by the
subcommittee chair objecting to those cuts, but the objection has
been withdrawn. Third, there was a concern with future funding.
In the DCED's December 16, 1999, presentation, it appeared that
the funding was speculative beyond this fiscal year. The
Legislative Finance Division had spoken with the Industry Network
Corporation (INC), which had indicated there was a good chance of
receiving some continued funding; however, there are no promises.
TOM LAWSON, Director, Division of Administrative Services,
Department of Community and Economic Development (DCED),
indicated there were some concerns expressed at the last
Legislative Budget and Audit meeting by Representative Austerman,
who had submitted a letter to the committee. Representative
Austerman's concerns were addressed, and he has withdrawn his
objection to the RPL, 08-0-0101.
MR. LAWSON explained that at the last meeting it appeared that
perhaps the scope of work for the forest products effort is a bit
ambitious, considering the time frame that remains in the fiscal
year. What wasn't made clear during the meeting on December 16,
1999, was that most, if not all, of the projects are at an
advanced stage of completion, and the DCED is seeking to have
someone in place for the remainder of this fiscal year in order
to complete those projects, which would enable the DCED to recoup
the time and money already invested in the projects and to bring
those projects to fruition.
MR. LAWSON noted that one of those projects is a directory of
Alaska sawmills; there are approximately 100 sawmills in Alaska,
and more than 60 of those companies have already provided
information to be included in the directory, which is to be
distributed to buyers of Alaska forest products and for
development of the web site. The other project is the promotion
of Alaska's value-added products in Japan, Korea and Taiwan; one
of those main projects is the production and distribution of an
Alaska products catalogue in the language of the customer, which
would be distributed at trade shows and one-on-one meetings with
potential buyers.
CHAIR PHILLIPS asked, "For clarification, the department [DCED]
has been doing these projects, they've been doing these things.
This money will pay the department back?"
MR. LAWSON responded that in terms of the marketing of Alaska's
value-added products in Asia, those were projects that were
already budgeted for; with the Industry Network Corporation
Grant, RPL 08-0-0101, providing funds to do that, those funds can
be allocated toward the forest products specialist position for
the remainder of this fiscal year.
Number 0602
REPRESENTATIVE BUNDE wondered if it would involve hiring an
employee and paying his or her salary. He referred to the
expression "soft money," which gives verbal assurance that the
grant will continue. He asked, "If the money goes away, does the
employee go away?"
MR. TEAL indicated that the DCED had provided assurance that the
grant would continue.
REPRESENTATIVE BUNDE noted that one of the other reasons the RPL,
08-0-0101, was turned down at the December 16, 1999, meeting was
that the legislative session's start was very near.
SENATOR PHILLIPS made a motion to approve the RPL, 08-0-0101/DCED
Industry Network Corporation Grant.
CHAIR PHILLIPS asked for unanimous consent. There being no
objection, the RPL, 08-0-0101/DCED Industry Network Corporation
Grant, was approved. She indicated that the next order of
business would be the RPL, 06-0-0180/HSS Public Preparedness for
Bioterrorism.
Number 0717
MR. TEAL explained that (indisc.--paper shuffling) $700,000 in
federal receipts from the Center for Disease Control bioterrorism
preparedness and response program. The intent is to detect and
respond to outbreaks of bioterrorism; to increase the state's
biological laboratory capacity; and to improve public health
electronic communication and up-front equipment purchases. Mr.
Teal indicated that the RPL, 06-0-0180, was discussed at the
December 16, 1999, meeting; the concerns expressed were the sense
of urgency, how soon it needs to be approved, and that it was a
new initiative. He noted that RPLs are intended to fund existing
programs, and a new initiative should really have full
legislative review. The third concern was with the six
positions, which the new write-up has as three new positions and
three filling-a-vacancy positions.
Number 0804
JANET CLARK, Director, Division of Administrative Services,
Department of Health and Social Services (DHSS), indicated that
Mr. Teal had adequately described the RPL, 06-0-0180, $700,000,
and there is no state match required; it is a four-year grant.
The grant was awarded on August 30, 1999. There is a letter from
the federal agency basically saying that there are some time-
sensitive actions that the DHSS needs to take in the first grant
year or it will jeopardize getting the second-, third- and
fourth-year grants.
MS. CLARK explained that the DHSS has a requirement to spend the
equipment dollars in the first year, because waiting until the
start of the new fiscal year, July 1, 2000, will not allow time
to purchase the equipment and have it in place as required by the
grant. In January, after the Legislative Budget and Audit
meeting in December, the DHSS had received a noticed from the
Center for Disease Control (CDC) about an anthrax threat to
Planned Parenthood agencies in many states. The DHSS wanted to
include this information to help the committee understand that it
is a real threat that is becoming more common. She added that
there was no threat in Alaska.
MS. CLARK further stated that [DHSS] views this as a way to build
the infrastructure for Alaska using federal money. As opposed to
the DCED's RPL, these activities are not part of [the
department's] regular work plan. This is a new activity for
them, and they think it will help strengthen Alaska's program.
It was a competitively awarded grant; Alaska was one of 20 states
to receive it. The federal government does see Alaska as
strategically located. There is a lot of support from the
military and the Federal Bureau of Investigation (FBI), because
of the military presence in Alaska and the pipeline. Ms. Clark
added that Alaska was almost a sure "in" when they went for the
competitive proposal.
CHAIR PHILLIPS mentioned that in the House Finance Committee
meeting the previous day, in conversations with the military,
there seemed to be much more emphasis on bioterrorism. She noted
that bioterrorism is a concern for Alaska.
SENATOR PHILLIPS stressed that from this point forward, he would
like the agencies to refrain from saying that this is only
federal funds. He stated:
We just went through a vote September 14. People in
Alaska obviously think we spend too much money; they
think the budget is $6 to $7 billion, and they frankly
don't care whether it's federal or state or whatever.
It's spending in the state. And the message we got
last September is we are spending too much money, and
they really don't give a rip whether it's state general
dollars or federal dollars, so I wish the agencies
would refrain from saying it's only federal funds.
Therefore, ... we should be concerned about it, because
we just had a vote; 84 percent of them said, "you spend
too much money" - or at least that's the interpretation
- so be conscious of what you say on how much money
we're spending in the state of Alaska, whether it's
state funds, receipts or whatever.
MS. CLARKE said that she would take that into account.
REPRESENTATIVE CROFT responded:
Well, I'd urge you not to take it into account. I
think it makes a great deal of difference, and you
should tell us whether it's federal money or program
receipts or general fund money. There's a lot of
different interpretations, and it's - to some extent -
our job, and our job in the next election, to explain
what we thought they meant in the vote. But yours is
to tell us the source of funds, and the source of funds
here is all federal. ... What were the criteria that
were in the grant that allowed us to receive it?
Strategic importance was one, I guess. What were some
of the others? Do you recall?
MATT ANDERSON, Unit Manager, Community Health and Emergency
Medical Services (EMS), Department of Health and Social Services
(DHSS), indicated that there is indeed a heightened national
concern about bioterrorism. As a consequence, federal money is
being made available to build public health infrastructures
specifically for the purpose of identifying and responding to
bioterrorist threats. The application actually allowed the DHSS
to apply for funding in several different categories including
laboratory capacity, epidemiology capacity, the health alert
network, and a few others.
REPRESENTATIVE CROFT wondered, "Would the military necessarily
tell us if there'd been a threat to military institutions? Might
they keep that secret?"
MR. ANDERSON said that he did not know the answer. He then
stated:
I know that we have an outstanding rapport with the
military and involve them in all of our planning. I
would suspect that they would make us aware of anything
that threatened the civilian population, and I do know
that the FBI [and] the military are always concerned
about the safety of the citizenry, and I would suspect
that they would make any threats known if they thought
we could do something about it.
CHAIR PHILLIPS explained that the legislature was informed that
there will be a 20-member team of bioterrorism specialists
assigned to Alaska, which will be able to work with any local
government entity that has a threat against it, such as a fire
department or a police department. She added that Alaska is one
of the few states that has been assigned this specialized team.
Number 1141
REPRESENTATIVE BUNDE responded:
I share Senator Phillip's concern .... Admittedly, not
everyone views it that way. But for those who take $6
billion plus and divide it by their residents of the
state and say we are outrageous in our spending, this
adds fuel to their frustration. And, again, their
frustration doesn't matter. The money comes from the
people .... A greater percentage of it comes from - if
it's federal dollars - from you and I than if it's
state dollars, because we don't pay any state income
tax; we most certainly pay federal income taxes. ...
You said this was granted on a competitive basis, 1 of
20 states. Is that because Alaska has a higher threat
of bioterrorism ...?
MR. ANDERSON replied:
Alaska was seen as having strategic importance partly
because of its remoteness. Calling for the cavalry
means quite a lag in response. ... They understood that
we needed to develop some self-sufficiency up here.
One of the consequences of that was that Anchorage was
named as 1 of 127 cities to be designated as a
metropolitan medical strike team to build their
infrastructure within their community. But more
importantly, the federal government, I think, wanted to
prime the pump to get enhanced capabilities to detect
both, particularly covert bioterrorist events, and have
responses that protect not only the citizens but the
rescuers.
An interesting note regarding the raid team that's
being assigned to Alaska, and an interesting irony, is
the fact that all of these teams that are being built
in Anchorage ... are somewhat dependent, I think, in
varying degrees, but some largely dependent on the
ability of the Department of Health and Social Services
to rapidly identify that an event has occurred and
identify or rule out a particular agent. And I think
if history is any indication, it's only a matter of
time before the anthrax threats march across the
country. And so far, they're in Wisconsin, but I think
it's probably a matter of time before they're here.
And I think we need to be prepared for that, and I
think this gives us a great opportunity to get our
house in order with respect to bioterrorism, at the
same time significantly improving our basic public
health infrastructure.
Number 1283
REPRESENTATIVE CROFT asked, "This allows us to detect so that
then we can call this SWAT team or the military SWAT team. How
does this augment the military response capability that
Representative Phillips talked about?"
MR. ANDERSON said he has not been entirely briefed on the
capabilities of the raid team, and they have yet to be trained.
He pointed out that Alaska was named as a recipient of the raid
team only that morning.
REPRESENTATIVE CROFT wondered, in general terms, how they are
informed of an outbreak.
MR. ANDERSON said there would be two different kind of events.
In an overt event, one might receive a letter that says, "You've
just been exposed to anthrax." In a covert event, there may be
one very sick person going to one hospital and another going to a
different hospital, with the inability to put those together.
REPRESENTATIVE CROFT clarified that by using the term "covert,"
Mr. Anderson means that there is no announcement and people just
start getting sick.
Number 1357
MS. CLARKE indicated that the funds were not earmarked in any
appropriation bill by U.S. Senator Ted Stevens at the federal
level. It was from the federal agency itself. In that sense, it
certainly was competitive.
SENATOR WILKEN stated that he, too, would like to know the source
of the funds. He said he draws a very bright line between his
money and the federal government's money. If he is presented
with a project that he feels is good for the people of Alaska,
then he is willing to spend his money. And if he can get some
help from tax dollars from Arkansas or New York, he would do that
as well. He informed the committee that he is not in the camp
that is worried about spending $6 billion. He wondered how the
20-person contingency would interface with the money that is
being spent, because he can see that as time marches on, they
will be linked up.
CHAIR PHILLIPS indicated that when the military has the team in
place, the Legislative Budget and Audit committee could request a
report from them and hold another meeting later in the session
with those people from the DHSS.
REPRESENTATIVE THERRIAULT wondered about the personnel request.
He clarified that the intention is to fill three vacant positions
and add three new ones instead of the original proposal, which
was to add six new positions.
MS. CLARKE said, "That's correct."
REPRESENTATIVE THERRIAULT clarified that there is $800,000, with
$200,000 to be spent on equipment and $100,000 apiece for each
position.
MS. CLARKE stated:
One of the issues with the information on the RPL is
that we were considering contracting for the
microcomputer technicians, and so the money is in
contractual for those positions. However, this is one
area that it's actually cheaper to hire state employees
than to go out on an hourly basis and contract, so we
do have to move that money into personal services. So
that's why the dollars don't quite look right.
REPRESENTATIVE THERRIAULT asked Ms. Clarke to describe the
positions, which will need to be looked at in the next budget.
MS. CLARKE responded:
We're asking for three positions: a microbiologist
trained especially for biological agents to work in the
lab, a distance-learning coordinator to ensure the
communication system is fully utilized for training,
and a public health specialist to work with health and
medical providers on recording unusual disease events
in some of these hospitals or other positions.
REPRESENTATIVE THERRIAULT wondered if the DHSS has any of that
capability now as far as disease outbreaks or if someone is
monitoring disease outbreaks.
MS. CLARKE responded that they have disease specialists, but
anthrax is a different biological agent, and different skills are
needed.
Number 1535
MR. ANDERSON indicated there are individuals who identify the
bugs and survey for disease outbreaks, trying to find the causes
and recommend treatment. Those resources are stretched very thin
right now. Furthermore, those individuals lack the training and
capabilities to deal specifically with biological agents. The
individuals that will be hired under the grant will do things
that are much different from their traditional calling. One
thing that this grant does is promote "dual use" where, in times
of stress on those traditional resources, these people can be
used to assist with a normal disease outbreak.
REPRESENTATIVE THERRIAULT wondered if these individuals hired
under the grant just "equip-up" and wait for the call to come or
can assist in normal disease outbreaks.
MR. ANDERSON indicated that they have the individuals under a
very ambitious work plan. They will be developing capabilities
over the next four years in a very coherent manner to identify
and respond to bioterrorist events. When they are not engaged in
those activities or when a need comes for them to migrate to an
[emergency] response, they have the capability to do so.
Number 1645
SENATOR PEARCE wondered how many private labs there are in the
state.
MR. ANDERSON said he did not know, but there are more each year,
none of which has the capability of doing the kinds of tests that
are being done by the public health lab.
SENATOR PEARCE wondered if the microbiologists would be working
as a training resource to the private labs.
MR. ANDERSON explained that part of the project is to ensure that
training takes place throughout the state - involving not only
state personnel involved in surveillance, protection and
response, but also the private medical community - so that, to
the extent that their resources permit, they can identify the
organism or rule out the organism. Therefore, even when that
does occur, the public health laboratory will have significantly
more resources than any private lab in the state.
SENATOR PEARCE asked whether there are federal labs in the state.
MR. ANDERSON responded that there are federal labs in the state,
none of which has the capabilities for identifying these
particular organisms. Most of the organisms are sent out to the
Center for Disease Control surveillance.
Number 1704
SENATOR PEARCE said:
So, we're planning as a state to develop the expertise
and the lab that will be responsible for training up
and down: up to the federal laboratory personnel, be
they military or civilian, and down to the private - I
don't mean up and down pejoratively - but down to the
private labs in the state. Just in reading the
description of the whole program, ... it sounds to me,
reading between the lines, that we're using the threat
of a bioterrorist attack - which I take seriously - as
a way to fill in some positions that the department
would like to have that aren't necessarily all that ...
specifically centered on the bioterrorism, like a
distance-learning coordinator.
I know that Senator Stevens did get $30 million for
distance delivery in the state, and I can't imagine we
need another distance-learning coordinator, so I'm a
little confused ... by some of the descriptions. So,
one microbiologist in the state, in the state lab, is
suddenly going to be the person for the whole state who
sets up the system by which labs will be able to do the
work and catch and then find any sort of an attack
statewide.
MR. ANDERSON responded that one microbiologist and one
epidemiologist will be responsible for building the capabilities
within those two sections. This is a multi-disciplinary and
multi-organizational project involving partners from the
military, the Municipality of Anchorage, and law enforcement to
ensure that their needs are being met without duplicating
efforts. Within those organizations such as laboratories and the
section of epidemiology, a great deal of dialogue has taken place
to ensure that the entire organization is enhanced by this, not
simply relying on one person to do all the work, even though that
person will be primarily responsible for writing plans,
identifying training opportunities, and ensuring that the correct
equipment is purchased.
Number 1814
SENATOR PEARCE asked where the description of the other three
employees was listed.
MS. CLARKE indicated it is on page 2 of the writeup where it
reads, "existing vacant PCNs will be for microcomputer
technicians."
SENATOR PEARCE said, "So, three microcomputer technicians."
MS. CLARKE responded, "Right. To keep the new communication
system up."
SENATOR PEARCE wondered who is keeping the system up now.
Number 1835
MR. ANDERSON explained that this particular communication system
does not exist. A major thrust of the federal initiative was a
health alert network, which would allow two things to occur: one
is very rapid alerting to health care providers that an event has
taken place, and the second is the ability to conduct distance
learning, in recognition of the fact that most public health
[personnel] throughout the country are inadequately trained, at
this point, to deal with terrorist events.
SENATOR PEARCE emphasized that there is an entire distance-
delivery system of medical services in place or being built. She
indicated that $171,000 is not going to [cover] a statewide
system or enough microcomputers to have three technicians.
MR. ANDERSON explained that the major initiative he knows of in
Alaska is called the AFHCAN (Alaska Federal Health Care Access
Network) project; it has the potential to really improve
telecommunication and distance education in Alaska. However, it
is mostly destined for federal facilities and community health
aides. What is not linked right now is our public health nursing
network and the distance-learning project. The offerings
available from public health personnel, with all of their
specialties, are enormous. He believes that the distance-
learning coordinator will be very busy identifying and
distributing the training.
SENATOR PEARCE stated:
The distance learning coordinator and the three
microcomputer technicians are going to be working on
something that's entirely ... outside of this
particular grant, and just bioterrorism and computers
that are ... a system that's being built with money
somewhere else that you don't talk about in here.
Number 1920
MS. CLARKE responded:
Public health nurses are one of the last groups to come
into the networking age, and we do not have our public
health nursing centers networked. And so this will
allow us to do that for public health nursing, as well
as putting the support to keep that network going. So,
you are correct. We are able to use this federal grant
to do something that we believe we need to do anyway.
So, that's where we say that the health alert network
doesn't exist. This will help connect this network
with other networks that clearly, as you point out, do
exist.
Number 1956
REPRESENTATIVE BUNDE expressed concern that this grant will cause
the state workforce to grow by three people. He asked if this
will be "soft money." He also asked whether there is any
assurance from the DHSS that in the third or fourth year, if the
grant is not forthcoming, the individuals will go away.
MS. CLARKE responded, "Absolutely." She explained that the
Division of Public Health has significant "soft money," and has
had to lose specialists when a federal grant has gone away. It
is a typical way that they have funded public health. She
expressed concern with having the full legislature review the new
proposal, which she feels is a good one. The grant was awarded
in August, and there are some requirements to spend the dollars
in a timely manner; therefore, if they wait until July 1, they
could not spend the money as the federal agency has required, and
it might jeopardize the second, third and fourth year. That is
why the RPL is being resubmitted to the committee.
REPRESENTATIVE BUNDE indicated that he understands the time
crunch, but said there does seem to be some duplication between
the federal agencies and the state. He wants to be sure that
this grant is absolutely necessary. He asked if bioterrorism is
referring to domestic terrorism or foreign terrorism, because
foreign terrorism seems to be a federal responsibility.
MR. ANDERSON stated that the threats were carefully considered
during the grant-writing process. Unfortunately, in most of
these events the source is uncertain, whether it is domestic or
foreign. During a response that information is not critical,
because either way the response is conducted in the same way. He
explained that one of the things they took great pains to do was
survey the resources that currently exist in Alaska. At the time
of the grant, the raid team did not exist. Mr. Anderson
indicated DHSS is scheduled to meet with representatives from
that team next week. He said he could assure the committee to
date that the process that has been used was entirely geared
toward ensuring the support and enhancement of existing
capabilities, and not toward duplication; although there may be
minor overlap between federal agencies and the state, that may be
healthy.
REPRESENTATIVE BUNDE stated:
I, too, would add my voice to hearing about how this
will be coordinated with what is really another state
agency, the National Guard, and I appreciate you having
an awareness and concern about duplication.
CHAIR PHILLIPS indicated a meeting would be scheduled.
REPRESENTATIVE CROFT said:
It seems to me you're facing the criticism that this is
a whole new program or it's not really a whole new
program. And if it's a whole new program, people have
concerns that they don't want to start a whole new
program . And if it's not, then it's just a subterfuge
to do what you were doing before. I don't think it's
all of one or the other. I mean, I think it is a new
initiative that's going to leverage some existing
things. It's been interesting watching you getting
grilled on both ends that "this is entirely new, isn't
it?" and "this isn't entirely new, isn't it?" But I do
hope you will coordinate - leverage - whatever we have
in terms of communication equipment or networks, and
coordinate with whatever the federal government has.
Number 2165
REPRESENTATIVE THERRIAULT stated:
Just looking at the backup here, it says, "It is
expected that the general funds to maintain this effort
at the end of the grant period" - which is ... four or
five [years] - "will not be needed since the majority
of the funding is for development and equipment
purchase, which will be completed by the end of the
grant period." But if you've got specially trained
personnel, is that a realistic statement that there
won't be some kind of ongoing need now? It may be four
years from now, but there's going to have to be some
personnel kept on.
MS. CLARKE said:
We'll have to assess that at the time, and it may be
that if we have some occurrences that this certainly
becomes more important than something else we're doing
with state general funds. But right now this is "soft
money," and that's how we're approaching it.
Number 2210
CHAIR PHILLIPS asked if there was any opposition to the approval
of RPL 06-0-0180/HSS/HSS Public Preparedness for Bioterrorism.
There being no objection, the RPL was approved.
EXECUTIVE SESSION
Number 2216
SENATOR PHILLIPS made a motion to move to executive session for
the purpose of discussing the audits. There being no objection,
the committee went into executive session at 9:10 a.m.
[Chair Phillips asked the Legislative Finance Division staff,
Legislative Audit Division staff, Tom Maher and Pat Hartley
(Legislative Budget and Audit Committee aide) to attend the
executive session]
CHAIR PHILLIPS made a motion to resume open session. There being
no objection, the committee resumed open session at 9:40 a.m.
AUDIT REPORTS
Number 2235
SENATOR PHILLIPS made a motion to release the following audits:
Department of Administration, Alaska Oil and Gas Conservation
Commission, and Department of Community and Economic Development,
Regulatory Commission of Alaska; Department of Administration,
Division of Alaska Longevity Programs, Alaska Pioneer's Home;
Department of Transportation and Public Facilities, Central
Region, Homer Gravel Roads Project. There being no objection,
those three audits were released to the public.
SENATOR Phillips noted that the Alaska Housing Finance Audit is
not up for release. He reminded members that it is still a
preliminary audit at this time.
SENATOR PHILLIPS clarified that the motion is to release the
preliminary audits for departmental review. There being no
objection, those audits were released to the agencies for review.
TAPE 00-1, SIDE B
[Tape malfunction -- was not recording until Number 0055]
Number 0055
PAT DAVIDSON, Legislative Auditor, Legislative Audit Division,
Alaska State Legislature, mentioned the need to follow up, as
needed, on any of the issues and concerns raised in the
consultant's report on a broad basis outside of the Mat-Su
[Matanuska-Susitna] Youth Facility. Alternatively, the committee
may wish to hold any action and wait for the consultant's report,
which may be out within the next month or so, and look at what
those findings and concerns are and then develop - or any
individual member may develop - an audit request as it relates to
DOT [Department of Transportation & Public Facilities].
Number 0148
SENATOR PHILLIPS made a motion to approve the recommendation by
Pat Davidson. He stated:
I believe that the Division of Legislative Audit should
review the costs and benefits utilizing DOT's staff -
managed facilities construction projects compared to
the private construction management. Additionally, the
division should follow up, as needed, on any issues and
concerns raised by the consultants [regarding] review
of the Mat-Su Youth Facility Project.
There being no objection, the recommendation was approved.
REPORT FROM THE DENALI COMMISSION
Number 0238
KRAG JOHNSON, Legislative Coordinator for the Denali Commission,
stated:
The commission was introduced by Senator Stevens and
approved by Congress in 1998. It's an innovative
federal/state partnership to solve critical problems in
Alaska. The many reports and stories that come out
about the Denali Commission's funding -- and so, to
review the facts, the original FY99 appropriation for
the commission was $20 million, and the funding for the
current fiscal year, fiscal year 2000, is at $20
million. And the commission has submitted a work plan
to the Secretary of Commerce for next year's budget
that is requesting $45 million for fiscal year 01.
To recap, real quickly, the FY99 funded project's list
is included in the packet. Primarily, the commission
followed the adopted theme of rural energy. Over
three-quarters of the budget was funded for bulk fuel
storage facilities and energy upgrades. And the
commission's intent is to start with basic
infrastructure, like the bulk fuel storage facilities
and energy upgrades, and then expand from this point.
So, the selection of the projects for FY99 followed the
Department of Community and Regional Affairs, Division
of Energy's listing, which is now the Alaska Energy
Authority, and that was the priority listing for
selection of communities. It's estimated the need for
bulk fuel storage facilities in Alaska is approximately
$450 million (indisc.) included.
Moving on to the current fiscal year, the commission
will be deciding funding allocations for the fiscal
year 2000 at a January 21 meeting here in Juneau next
Friday, and the commission has decided to continue with
the rural energy theme, which means approximately 75
percent of this year's budget will go to further bulk
fuel storage facilities and energy upgrades. And once
again the commission will follow the bulk fuel storage
facility and energy upgrade listing from the Alaska
Energy Authority.
I can mention the commission's requesting $45 million
for Congress for FY01. A copy of the actual work plan
that was submitted to the Secretary of Commerce is in
the packet, and the commission will continue once again
with the rural energy theme, but also is discussing
adopting additional themes for FY01, and a few of those
that are being discussed are rural health clinics and
multi-use facilities. A complete copy of that work is
in the packet.
Also, recent news about the Trans-Alaska Pipeline
liability funds - and so, to kind of briefly go over
that, the state, and presumably DEC, would be receiving
$18 million from this Trans-Alaska Pipeline liability
fund settlement for bulk fuel tank remediation in
Alaska. And the $6.2 million was designated to the
permanent fund by law, and the Denali Commission will,
in the future, be receiving an annual appropriation
from the interest of this account; that's estimated to
be $8.5 million, and this will be a continuous annual
appropriation.
So, to give you an idea of ... the economic engine the
commission could become if we had this funding source
from the Trans-Alaska Pipeline account, at the end of
next year and the beginning of the next fiscal year and
the request of $45 million for FY01, it's possible the
commission would have approximately $62 million
available in FY01.
We also included in your packets a copy of the first
draft of a statewide energy plan. The commission
partnered with the USDA [United States Department of
Agriculture] rural development and AIDEA [Alaska
Industrial Development and Export Authority] to put
together a statewide energy plan. The goal is to
provide some consistent policies and coordinated
efforts with the agencies that are funding Alaska
energy projects; and a copy of the first phase of this
plan is included in the packet. And phase two of the
plan is slated to be completed by the October 2000.
Workforce development and economic development are two
areas the commission also has been charged with. It
could be the most important work of the commission, but
is also the most difficult to make an impact. At the
upcoming meeting next week, a training strategy and an
economic development strategy will be before the
commission for further discussion; and both copies of
those strategies are in the January 21 backup material.
Number 0625
JEFF STASER, Co-Chairman, Denali Commission, indicated that they
are not before the committee to ask for money; they are there to
explain who they are, what they are doing, and how they do it.
They think of themselves as a partnership between the federal
government and the people of the state; the federal government is
the venture capitalist willing to invest in the state, and the
people of the state make the decisions regarding how to spend the
money. He noted that the co-chair on the commission is the
Governor, and there are five statewide organizations. He sees
the legislators as stockholders and investors. He emphasized
that the commission cannot succeed without the partnership of
everbody in Alaska.
MR. STASER said that as a federal agency, the U.S. Congress is
basically acting as the board of directors; they are investing
state-elected federal tax dollars from around the country in
Alaska, and every state has the right to ask the commission how
and why they are spending their money in Alaska. The
commission's message is to demonstrate to them that they are not
doing things that could otherwise be done by anybody else in the
state, and that these are appropriate things for the federal
government to be participating in. Alaska, with 600,000 people,
has a disproportionate share of influence over federal spending.
He said Alaskans should be proud of what they can do and have
been doing with the help from the federal government.
MR. STASER said that the start of the commission, back in April,
when they established themselves as a federal agency, was with
their own budgeting. They formed interagency staff with highly
skilled professionals who were being detailed from other
organizations to their staff. The federal agencies recognize
this as an avenue to go around some of their problems and to
participate in creative solutions for all of Alaska. He pointed
out that they had three years' worth of federal budgeting done in
the last nine months. They not only did their part in presenting
to the federal community their needs and the justification of
what they are doing, but they also, as a team, have persuaded the
President of the United States to budget for the Denali
Commission.
Number 0868
REPRESENTATIVE BUNDE wondered what is involved in state funds.
MR. STASER indicated that the Denali Commission is to go where
there are gaps, where the state cannot get to a problem. They
look, as part of their criteria, for cost-sharing. They figure
that if local communities in the state are not willing to invest
in a project, why should the commission invest. He noted that
currently they do not require matching funds from the state. If
a project is being cost-shared, then it should be given higher
priority.
REPRESENTATIVE MULDER wondered how many general funds are in the
commission's budget, and if there are federal requirements for
how much money can be spent on staffing.
MR. STASER responded, "Absolutely." He said in the law there is
a 5 percent cap on what can be spent on overhead. With all of
the startup costs and staffing issues over the last year, with
the first $20 million the overhead was less than 3 percent.
REPRESENTATIVE BUNDE wondered what was meant by "multi-use
facilities."
MR. STASER indicated that there are some great examples of how
the federal government designs a program based on national
assessments of need, but that leaves gaps. The federal
government doesn't understand the uniqueness of Alaska, so they
ask if the commission needs bulk fuel tanks or multi-use
facilities, which the commission is thankful about, even though
the commission hasn't carved out a place for them yet. Mr.
Staser said if they can get economies of scale and efficiencies
by consolidating programs, then "let's do it." He indicated they
have federal agencies coming to them and saying, "Let's enter
into an MOU [memorandum of understanding]; extend your
authorities to our program and we can get more bang for the
federal buck."
REPRESENTATIVE BUNDE wondered if the money is a federal
appropriation or gets filtered through the state budget.
Number 1152
MR. STASER explained that the commission puts in a work plan,
which contains the requests which they believe they need and the
reasons. Congress puts together a budget, which is signed into
law by the President. The money goes to the OMB [Office of
Management and Budget] at the federal level, which allocates it
to the agencies.
REPRESENTATIVE BUNDE clarified that the money does not expand
Alaska's total budget.
REPRESENTATIVE DAVIS wondered who is responsible for the multi-
purpose building five years from now, when it needs to be
repaired.
MR. STASER indicated that at this point it is difficult to
comment on how the multi-purpose area will be structured. This
is an issue that the commission is wrestling with. The
principles that they have outlined in their criteria are: what
are the long-term operations in maintenance, and how can it be a
self-sufficient, enabling type of utility? The priority will go
where the needs are, but there also needs to be flexibility. The
issues of operations and maintenance are critical to the
selection process. The commission is being instructed by the
communities as to what they need and how they are going to
maintain it.
Number 1394
REPRESENTATIVE THERRIAULT described his experience with visiting
a well-maintained facility in a community. He said somebody in
the community was responsible for maintaining the facility, and
there was no vandalism. He also described a different scenario
where the facility had holes punched through the walls and the
machinery was in disrepair; no one in the community wanted to
take on the responsibility of the facility. He pointed out that
there is a level of sophistication that makes all the difference.
MR. STASER indicated that he has a high level of confidence in
the people of Alaska. There has been an explosion in the
population in rural Alaska, which puts a strain on the utilities
and infrastructure, but there is also a generation that has
learned how to use the federal government effectively.
REPRESENTATIVE BUNDE said he hopes the commission sticks to that,
because he has seen, too many times, people waiting for someone
to write a grant rather than picking up a shovel and starting the
project.
MR. STASER explained that they need to be guided by the Alaska
legislature and other members of the state to fill the gaps and
to get the federal government to do the right thing. It takes
teamwork.
Number 1628
SENATOR HALFORD pointed out that Alaska has a history, in some
communities, wherein the pipe from the sewer and water system
that failed from the 1980s is sitting next to the pipe that
failed from the 1990s. In these communities the highest ground
is three to four feet above sea level; therefore, the sewer
system, which is waterborne and gravity-based, is never going to
work in some of those locations. He hopes some money gets put
into alternative methods of dealing with sewer systems in those
areas.
MR. STASER indicated the commission is working with the Alaska
Science Technology Foundation. He said the commission is not
interested in doing a lot of research. However, if some good
ideas are generated by the Alaska Science Technology Foundation
and the Alaska legislature, then the commission would be willing
to get them out to the communities.
SENATOR PHILLIPS wondered if the commission is doing the same
things in the area of alternative energy.
MR. STASER replied, "Yes." He indicated that as the commission
grows and expands, they will look at all of the alternatives.
OTHER COMMITTEE BUSINESS
There was no other business discussed at the meeting.
ADJOURNMENT
Number 1824
CHAIR PHILLIPS adjourned the Joint Committee on Legislative
Budget and Audit at 10:20 a.m.
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