Legislature(1999 - 2000)
03/29/1999 09:25 AM Senate FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE FINANCE COMMITTEE LOG NOTES 03/29/99 GENERAL SUBJECT(S): BALANCED BUDGET PRESENTATION The following overview was taken in log note format. Tapes and handouts will be on file with the Senate Finance Committee through the 21st Legislative Session, contact 465-2618. After the 21st Legislative session they will be available through the Legislative Library at 465-3808. Time Meeting Convened: 9:25 A.M. Tape(s): SFC-99 #69, Side A SFC-99 #69, Side B - malfunction SFC-99 #70, Side A PRESENT: X Senator Parnell X Senator Adams Senator Torgerson X Senator P. Kelly X Senator Donley X Senator Green X Senator Leman X Senator Phillips X Senator Wilken ALSO PRESENT: PAT DAVIDSON, Director, Division of Legislative Audit; KAREN PERDUE, Commissioner, Department of Health and Social Services; RUSS WEBB, Deputy Commissioner, Department of Health and Social Services; THERESA TANOURY, Administrator, Division of Family and Youth Services, Department of Health and Social Services; WILSON CONDON, Commissioner, Department of Revenue; KEN BOYD, Director, Division of Oil and Gas, Department of Natural Resources; DAVID TEAL, Director, Division of Legislative Finance; PHIL OKESON, Fiscal Analyst, Division of Legislative Finance; GREG WILLIAMS, Economist III, Department of Labor. SPEAKER DISCUSSION CO-CHAIR PARNELL Convened the SFC Committee at 9:25 a.m. for Division of Family and Youth Services Audit Review and a presentation from Ms. Davidson from the Division of Legislative Audit. He noted that there were two recommendations made from a DFYS audit performed one year ago that the SFC would like to be updated on. He noted that Nancy Wilkenson had faxed testimony to be included in the record. PAT DAVIDSON Director, Division of Legislative Audit Ms. Davidson referred briefly to a January 1998 audit of Division of Health and Social Services, Division of Family and Youth Services. She noted that the division had five objectives when performing that audit. 1. To evaluate how effectively DFYS management utilized FY97 personnel services fund to maintain agency staffing levels, adequately address response; 2. Evaluate how effectively and consistent DFYS met time lines established either by statute with regard to investigating and responding to child abuse; 3. To identify circumstances which inhibit DFYS ability to effectively respond to reports of harm; 4. To identify the degree of which DFYS was unable to respond to reports of harm and to evaluate the effects of not responding may have on child safety. 5. To access the effects those recent changes federal laws have had and propose state legislation for the child protection system. She noted that the conclusion on that study has shown that in FY97, DFYS did not investigate more than 3700 reports of harm. The Division of Audit believes that while DFYS is leaving some children at risk, and the DFYS social workers did not consistently did not make the required contact and that DFYS did not utilize its funding received FY97. Ms. Davidson commented that the Division had made 8 recommendations: 1) The Legislature should consider additional funding social worker positions; 2) If that funding is provided, then the Commissioner should report the effects of that funding back to the Legislature; 3) The Legislature should consider amending relevant child protection statute to provide for a frame work for a better working conditions; 4) The director of admin services should show that expenditures for retirement incentive program are made in accordance with legislative appropriation; 5) the director of DFYS should opt to implement a clear and consistent policy as to when crimes are investigated; 6) DFYS should develop an updated, accurate workload measurement model; 7) Efforts should be made to integrated professional development and training programs; 8) DFYS should insure timely and accurate entry of management information. A follow-up audit by the LBA Committee was released earlier this month. The conclusions of that report are that additional funding should be provided for more social workers with an overall drop of 4% in investigations. CO-CHAIR PARNELL Asked for further explanation of "work load adjustment". PAT DAVIDSON Explained that "work load adjust" is an informal policy to delay or never investigate reproach of harm. She continued by addressing the specific status of prior recommendations. The Legislature authorized funding for additional 28 social workers; most positions were filled in September & October 1998. The Legislature amended and strengthened child protection services, which took effect on Sept. 14, 1998. No evidence was found that those funds were used in 1998. Legislative Audit finds that DFYS cannot investigate each report of harm. The Division recommends that DFYS develop a useable and reliable work load measurement tool agency-wide. Ms. Davidson noted that DFYS has made significant progress to provide special development and training for staff. CO-CHAIR PARNELL Referenced Page 22 of the audit report, recommendations #5 and #8. He asked that those two be focused on during the meeting. PAT DAVIDSON Responded that when an agency is faced with a workload that funding doesn't allow completing, decisions then need to be made addressing the priorities. It is important for an agency to determine which has the highest priority. She commented that those are difficult decisions and ones that should be made by the management. Ms. Davidson reiterated that they should not be left to the individual social worker. The Division of Audit is asking management to define those risk factors so that staff clearly understands the policy. The Division of Audit has found that there has been no substantial progress on these two recommendations. SENATOR PHILLIPS Noted that there has been a follow-up regarding the eight recommendations. He voiced concerned on recommendation #7. PAT DAVIDSON Replied that DFYS falls in line with other recommendations regarding workload requirements. The Department has always tried to respond to matters of concern. DFYS would be better enhanced with a more updated information system. SENATOR PHILLIPS Noted the Division of Legislative Audit's recommendation that DFYS continue to correct, upgrade or replace the current State management system. He noted that he would be concentrating on recommendations #5, #7, and to make sure that the recommendations of the Legislative Auditor are implemented. CO-CHAIR PARNELL Referred to the Audit Report and asked what it practically meant for "child protection" in Alaska. PAT DAVIDSON Acknowledged that it could mean that those children left at risk are the ones that are lower priority cases. She emphasized that the Department needs to recognize and respond more quickly. KAREN PERDUE Commissioner, Department of Health and Social Services Commissioner Perdue introduced Russ Webb, the Deputy Commissioner and Theresa Tanoury of Child Protection. She referred to the audit handout as provided by the Department which illustrates the amount of work accomplished over the past year. There have been three audits in the last year. At the first audit, eight recommendations were released and the Department has substantially completed five of those eight. One of the most important recommendations of the audit was the enactment of HB 375. The Department is working hard at implementing that law. The Department did receive the 28 new positions which made for a lot of training of these new employees. The workers were not fully trained until January 1999, the time in which all new workers began to carry full caseloads. The effect of the new workers will begin to be noticed soon. Commissioner Perdue spoke to the amount of progress that has been done through the Department. There are 30 offices and the performance has increased dramatically in answering phone calls. She noted major progress in Mat-Su, Ketchikan and Fairbanks and the increase number of families receiving ongoing services. Commissioner Perdue commented that the Department was trying to comply with new laws asking them to act faster. CO-CHAIR PARNELL Referenced the "report of harm" graph. He asked if the Department had only answered more phone calls and more cases assigned to child protection workers. COMMISSIONER PERDUE Replied that it indicates that the percentages of the number of calls are being addressed now by the caseworkers. She noted that the numbers vary every month. CO-CHAIR PARNELL Noted that on Page 12 of the Audit, information conflicts with that presented. He believed that more cases were being assigned that are not being investigated. COMMISSIONER PERDUE Replied that there are two ways to measure the concern. The number of calls received each month changes, as do the kinds of cases. The Department must substantiate 50% of the calls that are investigated. Substantiation cases take longer. CO-CHAIR PARNELL Asked if the percentage assigned for investigation was used as a solid measure of operation or the percentage assigned for investigation. COMMISSIONER PERDUE Replied that it was the percentage assigned for investigation and the same as the top chart. Commissioner Perdue pointed out that the absolute numbers were relative to Anchorage. She updated the Committee on the situation in Anchorage. The Department made the decision following the audit, to focus on training because of the large staff turnover. In 1998, the Department made a big push to answer calls. They were getting an investigation assigned every 3.5 hours, which was physically impossible to handle. During that time, the Department lost many caseworkers. Commissioner Perdue noted that the outcome of that was a further focus on training. It now takes about 14.5 weeks of training per worker. That is where the Department currently is and the numbers are much better as of January 1999. Commissioner Perdue pointed out that the law is a "big deal". She noted that it is tremendously impacting the work done by the Department. In February this year, there were 44 child adjudication cases in Anchorage, which means a lot of work being done. The Department is really focused on implementing this new law. She noted that the performance measures in missions and measures statement have been tracked well. Commissioner Perdue commented that workers have paid for their own training. CO-CHAIR PARNELL Asked if the amount of money budgeted for training by the Legislature was enough. COMMISSIONER PERDUE Replied that training has been going well, however, now the Department is faced with providing the specialized trainings. CO-CHAIR PARNELL Pointed out that the training monies had not been encumbered until recently. He asked if training is such a big issue, why did it take six months to access those monies. COMMISSIONER PERDUE Replied that it was associated with the University RSA. She assured the Committee that the training was ongoing and that the Academy opened in August 1998. Commissioner Perdue stated that the Department does not disagree with any of the recommendations. She commented that items #5 and #8 were within the Department's work plan. She noted that on the back page there was a chart, which indicates the policy of prioritization. She spoke to the priority items and that priority 3 has been workload adjusted. It is true that different offices are working at different rates. However, that is not appropriate and the Department is trying to bring everyone up to the same level of service. When adding workers to the investigation unit, those workers have to be trained. She suggested that there is a policy within the Department and that issue has to due with quality versus quantity. A social worker can not be asked to investigate more than two cases per day. She emphasized that no call comes in "simple". These stories are very complicated, and unless the child is being tortured, the situation is a subtle rating. She commented that everyone was attempting to use the same information to rate calls. SENATOR PHILLIPS Asked if the handout contained the current procedure. RUSS WEBB Deputy Commissioner Department of Health and Social Services Replied that the material was supplied from the March audit performed last year. The procedure has been in place for many years. SENATOR PHILLIPS Noted that the audits recommended that DFYS should develop a clear and consistent policy so that "risk of harm" cases are not left unaddressed. He reiterated "Is there an update?" RUSS WEBB Replied that the difficulty is that the Department has a policy and the difficulty is applying that policy. It must be applied consistently so all understand rating of priorities. Priorities #1 and #2 are never allowed to remain uninvestigated. COMMISSIONER PERDUE Noted that the Department does not like the work load adjustment. SENATOR PHILLIPS Asked if the Department had achieved perfection? TAPE MALFUNCTION (Tape Malfunction - lost discussion from remaining testimony with Department of Health and Social Services) THERESA TANOURY Administrator Division of Family and Youth Services Department of Health and Social Services Explained that when three reports are received on one child, then DFYS investigates. If there is no imminent danger, it is not immediately addressed. Someone goes to check on the child. Low risk priorities are not immediately responded to. RUSS WEBB Suggested that when someone goes to investigate that perhaps that could bring more danger to the child. He pointed out that the case worker struggle with the safety of the child decisions that must be made. SENATOR PHILLIPS Interjected that the audit report states that there is not an established policy. PAT DAVIDSON Interjected that what the audit provides is a very "rough" cut. To look at policy, it must be more than a three way cut. General guidance is available, however, it has not been sufficient for consistency across the state for timely response. RUSS WEBB Commented that he believed that they had not achieved perfection; there is room for improvement. SENATOR KELLY Referenced the handout, commenting that why 70 - 90 days to do training? Was the prioritization carried out by fully trained staff operating at full capacity? PAT DAVIDSON Explained that prioritization was for the initial reports of harm and that HB 375 addressed when children were in custody. SENATOR KELLY Suggested that the prioritization schedule does not seem to be lacking. Perhaps when the trained staff are fully up to speed, it wouldn't be that way. The audit was a bit premature because it was being done when new workers were coming on and were not fully trained. PAT DAVIDSON Agreed that the audit was premature. She noted that she did not expect to see an increase in the reports of harm. Ms. Davidson believed that the prioritization for first three cuts was reasonable. She acknowledged that the problem must be identified and that the management must refine the workload measurement. COMMISSIONER PERDUE Agreed that this is complicated and that tough decisions must be made. CO-CHAIR PARNELL Noted that the reports of harm for January were down. COMMISSIONER PERDUE Voiced appreciation for the new help provided. She noted that some positions went into ongoing and community care licensing. RUSS WEBB Offered to provide in further detail. SENATOR WILKEN Referenced Page 5 - The Child Protection Status Report. TAPE CHANGE 99-69 B Tape Change, SFC 99-69, Side B COMMISSIONER PERDUE Explained the handout briefly. SENATOR WILKEN Asked if there were more categories of success and failure than listed? COMMISSIONER PERDUE Pointed out that the performance measures were in the packet. CO-CHAIR PARNELL Warned that discussion would end in five minutes. SENATOR PHILLIPS Asked if new staff had been hired in Anchorage. COMMISSIONER PERDUE Yes and noted that the Mat-Su and Kenai areas had pulled out of the Anchorage area so they could get the attention they needed. RUSS WEBB Responded to those comments. He noted that there is no particular average regarding the initial investigation and court time, etc. SENATOR KELLY Reiterated concern with reports of harm. COMMISSIONER PERDUE She pointed out that through HB 375, the teachers are mandated reporters. THERESA TANOURY Noted that the case workers meet once a month with the mandated reporters. The case workers mostly hear about low risk kids in the classes who Come into class hungry. COMMISSIONER PERDUE Commented on the pilot project in Mat-Su. There are hungry children, but these are not protection matters. SENATOR KELLY Asked if actions taken have resulted in better protection. THERESA TANOURY Replied that there has been increased communication between the Department and the mandated reporters. She was hopeful that the situation would improve. SENATOR GREEN Requested a breakdown in priorities. RUSS WEBB Stated that the Department must respond to all calls because they never really know the actual extent. CO-CHAIR PARNELL Questioned the workload adjustment. COMMISSIONER PERDUE Explained that this is something they have been doing for years and that they would like to get out of it. CO-CHAIR PARNELL Asked if it could be part of the Smart Start? COMMISSIONER PERDUE Yes. SENATOR WILKEN Reiterated that the audit was premature especially in the drawing of the conclusions. He acknowledged that this was a huge project and task. The Department must be vigilant. He noted that he would continue to support the project. CO-CHAIR PARNELL Moved the Committee into the Balanced Budget portion of the meeting. (brief at ease) Reconvened the SFC Committee. TAPE RESUMES (Tape Now Works) WILSON CONDON Commissioner Department of Revenue Commented that the Department of Revenue's Spring forecast would be ready soon. The oil price forecast would be consistent with previous testimony from Cambridge Energy and the Administration that the average price expected would be $14.50/barrel. He commented that over next five years the expected revenue will be between $1 billion 350 million or 400 million over the next five years. Commissioner Condon spoke to the handout. He predicted that there would be ups and down periods over the next five years. He believed that the Constitutional Budget Reserve funds would be exhausted at the current use by 2002. If prices average $16.50/bbl, the exhaustion date would change to 2003. Commissioner Condon continued his overview of the handout. Page 2 will help to understand the impact if prices get better or worse. The reference shows how $1 dollar could affect the price change. He noted that there has been more than a 50% decline from 1990 to 2000. It is anticipated that there will continue to be a decline. SENATOR TORGERSON Asked if the Department anticipates the $14.50/bbl for FY00. COMMISSIONER CONDON Replied that is the anticipated average. SENATOR TORGERSON Commented that the Committee is working on a long-range budget projection over a 20-year time frame. He asked if there were suggestions from the Department regarding that concern. COMMISSIONER CONDON Anticipated that oil prices will increase with inflation going forward. If history were a guide, then we would question that conclusion because oil prices have crashed before. The oil prices have averaged about $16/barrel. SENATOR TORGERSON Stated that was not much help. COMMISSIONER CONDON Noted that the $16/bbl would be a number of years before inflation would catch up. CO-CHAIR PARNELL Asked how do the experts project out into a 20- year period. What measures could be used? COMMISSIONER CONDON Replied that the experts make judgments about what's going to happen in terms of demand, response to the demand, where will the supply come from, and what will happen technologically. Additionally, the political judgment must be considered. He pointed out that his staff has also done their own projections. SENATOR WILKEN Asked if there would be a change in the projections? COMMISSIONER CONDON Replied that would depend on how much oil was available. TAPE CHANGE 99-70 A Tape Change SFC 99-70, Side A SENATOR PHILLIPS Asked if there were any projections of how to replace the diminishing oil. Additionally, he asked if Department of Revenue could project how much it would take to replace what was declining in ANWR. COMMISSIONER CONDON Replied that it would be easy to calculate that number at a later date. SENATOR WILKEN Questioned if there was a generally accepted principle at which the pipeline would not work? COMMISSIONER CONDON Estimated that at 300,000 bbl/day, it would no longer be economical. SENATOR LEMAN Questioned the reason for the big drop indicated this fiscal year and the next year. He pointed out the charts indicate something substantial occurring with the general decline in production. SENATOR PHILLIPS Asked when does the State would reach 300,000 barrels/day. COMMISSIONER CONDON Replied that would occur sometime after 2020, based on information available at this time. CO-CHAIR PARNELL Comments that Ken Boyd was also on line. KEN BOYD Director Division of Oil and Gas Department of Natural Resources Referenced the memorandum dated 3/26/99. He noted that Pages 1 & 2 and 3 & 4 were from last year's production forecast. These are broken down by field and company. He continued, Pages 5 & 6 illustrate this year's forecast. He quickly compared Page 1 & Page 5, which starts with the North Slope Alpine. Mr. Boyd explained that the State totals were listed in the handout, listed year by year. CO-CHAIR PARNELL Pointed out that the production was down a little? KEN BOYD Stated that forecasts can dramatically change over night. SENATOR WILKEN Inquired about the 9% reduction. He guesstimated it should be about a 16% reduction. KEN BOYD Responded that the numbers were newly run. He added it would be easier to calculate the numbers once the information is graphed. SENATOR WILKEN Stressed that there was a difference between a 9% and a 16% reduction. He asked that the information be reconciled. KEN BOYD Referenced Page 9 of the handout, which is a map of the Northern Alaskan activity. Page 11 illustrates the first chart, project under development. SENATOR TORGERSON Asked that the projects listed on Page 11 be quickly described. KEN BOYD Offered brief a clarification. He noted that the amounts listed on that graph are already very different that listed. These amounts change dramatically within a short time period. He listed the projects: Tsunami, North Star, Red-Dog, Alpine, Pearl Bay Satellites, Aurora Prospect, Tobacco and Tarn, Westback and Trader Bluff. SENATOR TORGERSON Asked if there would be a projected increase based upon new releases. He inquired if those figures had been included in the new projections. KEN BOYD Stated that some had been while others had not. He reiterated that the numbers was an estimate not an absolute number. SENATOR TORGERSON Clarified that the projections could be off by 50,000/bbls per day. KEN BOYD Advised that the totals are there and the projections are fairly accurate. Mr. Boyd referenced Page 12 and the map on Page 13. He stated that the State would need to wait and see what happens with all the wells in May. Page 14 maps all the basins in Alaska. There have been responses on the exploration licensing in the Copper River. He suggested that the "big" wildcard was NPRA-Chuckchee which is a huge off shore basin. Thus concluded Mr. Boyd's testimony. SENATOR TORGERSON Noted that he did not see the Aurora well listed in the unaccumulated oil predictions. He asked when those might come on line. KEN BOYD Replied that Aurora was only discovered last Friday. The graph is a satellite only. He guaranteed that more would be known about the Thompson by September. SENATOR TORGERSON Requested that a compilation of everything anticipated to be on line be submitted to the Committee in order to provide that information be used for the long-range forecast. KEN BOYD Noted that would arrange a conversation with Bill Van Dyke, who understands all the proposed assumptions. Mr. Van Dyke would be able to tell what had been included and what had been left out due to time. SENATOR TORGERSON Inquired what the new platform at Cook Inlet production figures were. KEN BOYD Replied that he did not focus on Cook Inlet for this presentation, however, could provide the information. He reiterated that he does not have any present data. SENATOR TORGERSON Asked how the projections could be made without that information. KEN BOYD Responded that many kinds of estimates could be made. SENATOR TORGERSON Suggested that he was in the mood to speculate on possibilities. He believed that there are estimates available that should plan for production. KEN BOYD Stated that there is no public data available at this time regarding that concern. SENATOR TORGERSON Asked for Mr. Boyd's opinion regarding the ARCO/British Petroleum merger. KEN BOYD Noted that the news was also new to him. He had only found out about it yesterday. There are many questions that must be answered. The power field would now be owned by BP/ARCO. He did not know how it would affect the competitive costs. He stated that each company has a settlement agreement. SENATOR TORGERSON Asked for comments on the possible increase in gas production. KEN BOYD Projected that the numbers can not get much higher than what they currently are. Those numbers are variable because of vapor pressure considerations on the pipeline. He understood that 90 thousand was the limit. SENATOR WILKEN Referred to Commissioner Condon's testimony of a slow down to 300,000/bbls per day. He asked if Mr. Boyd agreed with that number? KEN BOYD Stated that he did. The Department of Energy has published that number. SENATOR WILKEN Asked the number of drill rigs operating on the North Slope over past 3 years. KEN BOYD Offered to submit that information to Senator Wilken. CO-CHAIR PARNELL Thanked Mr. Boyd. He requested that the Department of Labor make their presentation regarding population projections. The size of the population will affect any budget. GREG WILLIAMS Economist III Department of Labor Provided a brief overview on the Alaska State population projections. The two major factors that will influence that growth are birth/death and migration. The set of projections going out 20 years shows the growth of the current 621 thousand people up to a possible 776 thousand. The assumptions made based upon continuation of historical trends. The age distribution in Alaska has some large and small groups of people, the most noticeable is the "baby boom". The children of the baby boomers create the second wave moving up. He noted that the most dominant factor is the natural increase and that the booms and busts do not usually last long periods of time. The focus is on two groups that are of most interest: 1) the school age population and 2) the elderly. Mr. Williams noted that the biggest population now is aging out and the second graph indicates significant increases. These increased figures create a substantial strain on State resources. The other group of interest is school age children, which is a much flatter growth rate. CO-CHAIR PARNELL Requested a breakout of the projections for over the next five years. He voiced concern with the loss of 3000 jobs in the Anchorage area and the impact that would have on the migration of children in school. GREG WILLIAMS Replied that was not available in the base line. Migration as a whole usually has a short impact. CO-CHAIR PARNELL Asked if the forecast over next five years takes into account current economic status and loss of jobs. GREG WILLIAMS Stated that it would be difficult to provide a forecast staking it our over the next five years taking into consideration the economic forecast. The numbers provided on the handout have been just released and that the current changes account for relatively little school enrollment in Anchorage, mostly because the migration is not a large percentage of the underlining population in that area. Most of the result now appearing comes from the aging of those born about 1975. He acknowledged the differential shift by regions. CO-CHAIR PARNELL Pointed out that the numbers provided indicate a 3.1% change in the 1-17 age group between 1995-2003. The Governor's financial plan allows for a 6.5% increase in student population in that same period of time. He asked for some realistic assumptions on student populations. GREG WILLIAMS Advised that the projections come out of individual ages. SENATOR WILKEN Noted that in the 5 to 17 year old age groups, there are approximately 129,000 children in his school district, however, the chart in the packet indicates 145,000 school age children. He asked why those numbers are not the same. CO-CHAIR PARNELL ADJOURNMENT Co-Chair Parnell warned that the Committee had run out of time. The meeting was adjourned at 11:20 A.M. SFC-99 (1) 3/29/99 a.m.
| Document Name | Date/Time | Subjects |
|---|