Legislature(1995 - 1996)
02/07/1996 02:35 PM Senate CRA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
SENATE COMMUNITY & REGIONAL AFFAIRS COMMITTEE
February 7, 1996
2:35 p.m.
MEMBERS PRESENT
Senator John Torgerson, Chairman
Senator Randy Phillips, Vice Chairman
Senator Tim Kelly
MEMBERS ABSENT
Senator Fred Zharoff
Senator Lyman Hoffman
COMMITTEE CALENDAR
SENATE BILL NO. 229
"An Act relating to employment contributions and to making the
state training and employment program a permanent state program;
and providing for an effective date."
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 20
"An Act establishing the Alaska municipal basic services program,
relating to certain programs of state aid to municipalities and
recipients in the unorganized borough; and providing for an
effective date."
PREVIOUS SENATE COMMITTEE ACTION
SB 229 - No previous action to record.
SB 20 - See Community & Regional Affairs minutes dated 2/22/95.
WITNESS REGISTER
Rebecca Nance, Director
Division of Employment Security
Department of Labor
P.O. Box 25509
Juneau, AK 99802-5509
POSITION STATEMENT: Offered information on SB 229
Mark Mickelson, Manager
JTPA/SDA Program
Department of Community & Regional Affairs
P.O. Box 112100
Juneau, AK 99811-2100
POSITION STATEMENT: Responded to questions on SB 229
Paul Engelman, Research Economist
Department of Labor
P.O. Box 21149
Juneau, AK 99802-1149
POSITION STATEMENT: Responded to questions on SB 229
David Stone
Council of Alaska Producers
3100 Channel Drive, #2
Juneau, AK 99801
POSITION STATEMENT: Testified in support of SB 229
ACTION NARRATIVE
TAPE 96-4, SIDE A
Number 001
CHAIRMAN TORGERSON called the Senate Community & Regional Affairs
Committee meeting to order at 2:35 p.m.
SB 229 STATE TRAINING & EMPLOYMENT PROGRAM
SENATOR TORGERSON brought SB 229 before the committee as the first
order of business.
Number 010
REBECCA NANCE , Director, Employment Security Division, Department
of Labor, explained that the State Training & Employment Program
(STEP) has been in the pilot stage for about six years, and SB 229
will make it a permanent program.
Ms. Nance presented a brief a section by section analysis as
follows:
Section 1 follows through on legislative findings that recommend
that a state training program is needed to provide a trained Alaska
work force and to reduce the claims for unemployment insurance
benefits.
Section 2 codifies the temporary program into a new eight-section
chapter which are:
AS 23.23.010 creates the STEP program on a permanent basis and
it uses primarily the original language from the pilot
legislation that started in 1989.
AS 23.23.020 establishes the employment assistance and
training account in the general fund, so, basically, general
fund monies aren't used. There are funds earmarked from the
employee contribution of the UI (Unemployment Insurance) tax,
and the Legislature would appropriate the funds that have
already been designated for this express purpose.
AS 23.23.030 provides the funding mechanism for the program.
One-tenth of one percent of the employee contribution to the
Unemployment Insurance Fund would be what is used for this.
The most any employee would pay for this program would be
roughly $24 after they've maxed out on their base wages.
AS 23.23.040 allows for the flexibility of the program that
federal programs aren't able to address. Any Alaskan who is
currently on unemployment insurance, or has been a past
recipient, or might be a recipient would be eligible under
STEP.
AS 23.23.050 defines the services that the grantees must
deliver. They must provide one or more of the services
listed.
AS 23.23.060 defines the duties of the department in awarding
grants to the Alaska Human Resource Investment Council. The
Council was created by the Legislature in the 1995 session and
it consolidates the employment and training programs in the
state. It also addresses the administration of the council
and the employment and training programs and provides that the
council may award grants to other entities.
AS 23.23.070 sets out the duties of the Alaska Human Resources
Investment Council in awarding STEP grants and it insures that
the program will not compete with or displace other training
programs or training money.
AS 23.23.900 defines the terms used in the chapter.
Section 3 provides for the effective date of the legislation.
Ms. Nance said STEP has been a flexible program that is paid for
and utilized by Alaska workers, it stabilizes employment in the
state and keeps Alaskans trained and ready to work in Alaska. She
urged the committee's support of the legislation.
Number 125
SENATOR TORGERSON asked for examples of pilot projects that might
be administered by the council.
Responding to Senator Torgerson's inquiry, MARK NICHOLSON , Program
Coordinator, Department of Community & Regional Affairs, said in
his role as program coordinator, he has been responsible for a
combination of both federal and STEP state supported activity. He
said he could provide a comprehensive list of the actual training
and the jobs placed, but he pointed out that one area in which they
feel they've really made some strides in promoting Alaskan hire has
to do with training in the fisheries. He said they have provided
assistance for a variety of different occupations and training,
focusing the training on where there are Alaskan jobs.
SENATOR TORGERSON asked for a description of "administrative
entities of the sub-state service delivery areas." MARK NICHOLSON
explained that under the Job Training Partnership Act three sub-
state areas were created that met the criteria set forth in the
federal legislation for purposes of local administration of
employment training programs under the Job Training Partnership
Act. Those service delivery areas are Alaska Statewide, the
Anchorage/MatSu Consortium and the Fairbanks Private Industry
Council.
Number 130
SENATOR KELLY referred to a table on funding allocations and
expenditures for the STEP program for fiscal years 1990 through
1994, and he asked why it cost $283,445 to cover the cost of
funding collection when all they need to do is get a check from the
unemployment pool. PAUL ENGELMAN , Research Economist, Department
of Labor, said the dollar amount was a negotiation between the
department and feds, but his understanding is that because the
program is funded out of the state's portion, the department was
held responsible for the entire cost of collecting that money. He
added that he would get information on that figure.
SENATOR KELLY asked how many state employees were working directly
in this program. REBECCA NANCE responded that no one is fully
funded by this, but they have one person in the technical unit and
the program manager for employment services who work on the
program, as well as whatever research analysis needs to be done on
it.
SENATOR KELLY said he was interested in understanding the cash flow
and the how the money flows through the Department of Labor to
whoever puts it into the training cycle. REBECCA NANCE said she
would supply that information to Senator Kelly and the committee.
She noted that the $283,000 figure has been reduced by
approximately $75,000, which was put back into the UI trust fund.
She also noted she had provided a list of contractors and their
award amounts from program years 1990 through 1994.
MARK NICHOLSON related that for the service delivery component, the
three sub-state areas are allowed 12 percent for administrative
overhead, so approximately 88 percent is directed towards client
services with the grants that are made available. In his
department STEP supports one full position, as well as a small
portion of a few other people who are involved. He also noted that
they believe that Congress will pass a new federal block grant for
states' unemployment training.
Number 300
SENATOR TORGERSON said that SB 206 (Welfare Reform) is also in the
Community & Regional Affairs Committee, and a lot of that is
dedicating large amounts of money into employment types of
programs, and he asked how that interacts with the STEP program.
MARK NICHOLSON responded that the current system tries to work in
sync with respect to some of the different federal programs. There
are different eligibility and different criteria with respect to
the type of people they are trying to serve. The STEP legislation
does not focus on economically disadvantaged; it is a little
different target and it fits in nicely in terms of eligibility and
outreach. The federal resources currently serve about four to five
percent of the potentially eligible clients. He added that
whatever happens with the welfare reform legislation, he thinks it
will be important to work with the systems and the people that are
familiar with employment training.
SENATOR TORGERSON pointed out that there are many departments that
are having economic development programs with the same goal to put
people to work. However, last year the Alaska Human Resource
Investment Council was created combining a lot of these things so
that the council would be able to take this responsibility, but now
we're doing other things with it through department programs, he
observed.
Number 435
SENATOR KELLY asked if trainees in programs get an advanced
unemployment insurance benefit while they are doing the training.
REBECCA NANCE answered that that was separate and they would have
to meet eligibility on their own. She did note that some grantees
provide room and board as part of their training programs.
SENATOR KELLY also asked if there were any significant changes
between the existing STEP program and this legislation that makes
it a permanent program. REBECCA NANCE replied that the only
significant change is the area relating to the Alaska Job Training
Council, which sunsetted December 31, 1995.
Number 450
DAVID STONE , President, Council of Alaska Producers, said their
membership consists of all of the major hard rock mining companies
actively doing business in Alaska, and he expressed the mining
industry's support for the permanent reauthorization of the STEP
program. He said the program is and has been business friendly and
business accessible. It is more flexible and has less restrictions
than most job training programs primarily due to the fact that the
program is designed and administered by Alaskans. He added that
STEP has already trained Alaskans and resulted in jobs in the
mining industry, as well as it has helped workers who have lost
their jobs. The members of the Council of Alaska Producers view
STEP as a true partnership between the state of Alaska and
industry, and they encourage its passage.
Number 475
SENATOR TORGERSON stated SB 229 would be held so that the
department could respond to questions that had been raised during
the hearing.
SENATOR TORGERSON brought SSSB 20 (ALASKA MUNICIPAL BASIC SERVICES
PROGRAM) before the committee as the final order of business. He
directed attention to a proposed committee substitute, as well as
a proposed amendment.
SENATOR KELLY moved that CSSSSB 20(CRA) be adopted. Hearing no
objection, the Chairman stated the motion carried.
SENATOR KELLY moved the following amendment to CSSSSB 20(CRA):
Amendment No. 1
Sec. 3: Add a line for "Revenue Sharing for Safe Communities (AS
29.60.350-29.60.372)" following "Priority Revenue Sharing" in the
Notice to Taxpayer.
Sec. 9: Add a new subsection (d) which states "The intent of this
section is to that the governing body of each municipality include,
on its notice to taxpayer under AS 29.45.020, the amount of funds
received from this program."
Sec. 10: Change 29.360(b) only by changing the word "appropriated"
to "allocated"; changing the "municipal assistance" fund to the
"safe communities" and deleting the last portion of the final
sentence "...on the basis of amounts received during the fiscal
year 1978 under AS 43.70.080."
Sec. 11: Omit the opening phrase "After the distribution under AS
29.60.372(b)."
Sec. 12: Perhaps the word "or" to "and" when listing the statutes
under which a municipality qualifies in 29.60.372(a).
Reword subsection (b) to say "Adjustments of payments
under this section shall be determined by prorating amounts payable
under AS 29.60.360, and AS 29.60,370, and 29.60.372(a) by a factor
that, when applied, reduces all payments in equal proportion so
that payment under AS 29.60.360, AS 29.60.370, and AS 29.60.372(a)
equal the amount allocated to the Safe Communities Fund under AS
29.60.350."
Hearing no objection to Amendment No. 1, the Chairman stated it had
been adopted.
SENATOR TORGERSON stated the new committee substitute would be sent
out to all municipalities for their perusal before the next hearing
on the legislation is scheduled.
There being no further business to come before the committee, the
meeting was adjourned at 3:15 p.m.
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