Legislature(2009 - 2010)SENATE FINANCE 532

04/11/2009 11:00 AM FINANCE


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11:23:26 AM Start
11:24:06 AM SB75
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Time Change --
+= SB 75 BUDGET: CAPITAL, SUPP. & OTHER APPROPS TELECONFERENCED
Moved CSSB 75(FIN) Out of Committee
+= SB 170 UNEMPLOYMENT AMENDMENTS: FED STIMULUS TELECONFERENCED
Moved CSSB 170(FIN) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
                  SENATE FINANCE COMMITTEE                                                                                      
                       April 11, 2009                                                                                           
                         11:23 a.m.                                                                                             
                                                                                                                                
11:23:26 AM                                                                                                                   
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stedman called the Senate Finance Committee meeting                                                                    
to order at 11:23 a.m.                                                                                                          
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Charlie Huggins, Vice-Chair                                                                                             
Senator Johnny Ellis                                                                                                            
Senator Donny Olson                                                                                                             
Senator Joe Thomas                                                                                                              
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Miles Baker, Staff, Co-Chair Stedman; Karen Rehfeld,                                                                            
Director, Office of Management and Budget, Office of the                                                                        
Governor                                                                                                                        
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
None                                                                                                                            
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB 75     "An Act making and amending appropriations,                                                                           
          including capital appropriations, supplemental                                                                        
          appropriations, and appropriations to capitalize                                                                      
          funds; and providing for an effective date."                                                                          
                                                                                                                                
          CSSB 75 (FIN) was REPORTED out of Committee with a                                                                    
          "do pass" recommendation.                                                                                             
                                                                                                                                
SB 170    "An Act modifying the Alaska unemployment                                                                             
          insurance statutes to  comply with the requirements                                                                   
          of   the   federal   economic  stimulus   bill   by                                                                   
          redefining   the   base  period   for   determining                                                                   
          eligibility   for    unemployment   benefits;   and                                                                   
          providing for an effective date."                                                                                     
                                                                                                                                
          CSSB 170 (FIN) was REPORTED out of Committee with                                                                     
          a "do pass" recommendation and with zero fiscal                                                                       
          note #1 by the Department of Labor and Workforce                                                                      
          Development.                                                                                                          
                                                                                                                                
11:24:06 AM                                                                                                                   
                                                                                                                                
SENATE BILL NO. 75                                                                                                            
                                                                                                                                
     "An Act  making and  amending appropriations,  including                                                                   
     capital  appropriations,   supplemental  appropriations,                                                                   
     and appropriations  to capitalize  funds; and  providing                                                                   
     for an effective date."                                                                                                    
                                                                                                                                
AT-EASE:       11:24:37 AM                                                                                                    
                                                                                                                                
RECONVENED:    11:27:18 AM                                                                                                    
                                                                                                                                
Co-Chair  Hoffman MOVED  to adopt  the work  draft to SB  75,                                                                   
labeled 26-GS1-3\T, Kane, 4/10/09.                                                                                              
                                                                                                                                
Co-Chair Stedman OBJECTED for discussion purposes.                                                                              
                                                                                                                                
11:28:10 AM                                                                                                                   
                                                                                                                                
MILES BAKER, STAFF, CO-CHAIR STEDMAN,  referred to a document                                                                   
entitled "2009 Legislature - Capital  Budget Statewide Totals                                                                   
- Senate  Structure" (copy on  file).  He explained  that the                                                                   
first column  is principally Section  1 of the bill  - the FY                                                                   
10 capital  budget based on  the governor's amended  request.                                                                   
Section  4  of the  bill,  the  second column,  contains  the                                                                   
cruise ship  fund items.    The third column consists  of the                                                                   
transportation stimulus  items.  The  forth column is  the FY                                                                   
09 supplemental budget.   The language items  were moved into                                                                   
their  appropriate  sections  for totaling  purposes  in  the                                                                   
report.                                                                                                                         
                                                                                                                                
Mr. Baker  discussed the  changes in the  new version  of the                                                                   
bill.  One project  was accidently left off  - the Department                                                                   
of Commerce Manufacturing Extension  Program.  The intent was                                                                   
to  include all  items  with federal  matches,  such as  this                                                                   
program.   This addition is found  on page 3, lines  6 and 7,                                                                   
for $806,401,000.   The  only other  change that affects  the                                                                   
capital   numbers  is   the  administration's   February   24                                                                   
amendment   which  deleted   thirteen   items   out  of   the                                                                   
transportation  portion of  the bill.   These  transportation                                                                   
items were moved to the stimulus  portion of the bill.  There                                                                   
were  three  federal  project  additions  which  total  $22.9                                                                   
million.   It was the intent  to include the  federal receipt                                                                   
authority  for surface transportation  and aviation  projects                                                                   
in the FY 10 capital budget.                                                                                                    
                                                                                                                                
11:31:36 AM                                                                                                                   
                                                                                                                                
Mr.  Baker  reported  that  the  rest  of  the  changes  were                                                                   
technical  in  nature.    There   were  three  Glenn  Highway                                                                   
projects  and one Parks  Highway project  where the  Milepost                                                                   
numbers were added to the titles  of the projects.  There was                                                                   
an incorrect statutory reference  on page 43 regarding cruise                                                                   
ship  head  tax  funds.   In  the  legislative  appropriation                                                                   
section, three  re-appropriations were  added in:  Section 24                                                                   
on page  70, a Fairbanks  area wide reappropriation,  Section                                                                   
33, page  74, line 20, and  Section 36, page  75, legislative                                                                   
reappropriations  regarding  the  balance  of funds  for  the                                                                   
Endangered Species Act.                                                                                                         
                                                                                                                                
11:33:28 AM                                                                                                                   
                                                                                                                                
Mr. Baker addressed  two dividend fund source  changes: $29.9                                                                   
of Alaska  Housing Finance  Corporation (AHFC) dividends  and                                                                   
$22.7 of Alaska  Industrial Development and  Export Authority                                                                   
(AIDEA) dividends  replaced $56.2  million in general  funds.                                                                   
That is shown  on page 62.   The $15 million going  to Alaska                                                                   
Gasline  Inducement  Act  (AGIA)  is now  coming  from  AIDEA                                                                   
dividends.   The sum of $25  million to the  renewable energy                                                                   
grant fund  is coming  from AHFC dividends.   The  balance of                                                                   
the $52.6 million went to federal aid highway state match.                                                                      
                                                                                                                                
11:34:53 AM                                                                                                                   
                                                                                                                                
Mr. Baker summarized that the  budget before the Committee is                                                                   
$28.9  million  higher  in  federal  funds  due  to  the  DOT                                                                   
projects.   It is also $52.5  million higher in  other funds,                                                                   
and $51.7  million lower  in general  funds.  The  difference                                                                   
between  the two numbers  is due  to $806,000  added for  the                                                                   
Manufacturing Extension Program.                                                                                                
                                                                                                                                
11:35:41 AM                                                                                                                   
                                                                                                                                
Co-Chair Stedman  WITHDREW his  objection to the  adoption of                                                                   
the CS.  There being NO OBJECTION, Version T was adopted.                                                                       
                                                                                                                                
11:36:14 AM                                                                                                                   
                                                                                                                                
Senator Thomas MOVED to ADOPT Amendment 1:                                                                                      
                                                                                                                                
     Page 35, line 22:                                                                                                          
     Delete "10,000,000" in both places                                                                                         
     Insert "15,300,000" in both places                                                                                         
     Page 35, line 22:                                                                                                          
     Delete "UA Climate Projects"                                                                                               
     Insert "UAF Energy Technology Building"                                                                                    
     Page 35, lines 24 - 25:                                                                                                    
     Delete all material.                                                                                                       
     Page 39, line 19:                                                                                                          
     Delete "30,000,000"                                                                                                        
     Insert "30,300,000"                                                                                                        
     Page 39, line 21:                                                                                                          
     Delete "$33,200,000"                                                                                                       
     Insert "$33,500,000"                                                                                                       
     Page 39, line 25:                                                                                                          
     Delete "$1,230,384,368"                                                                                                    
     Insert "$1,230,684,368"                                                                                                    
                                                                                                                                
Co-Chair Stedman OBJECTED.                                                                                                      
                                                                                                                                
Senator  Thomas   explained  the   amendment  swaps   receipt                                                                   
authority for two projects, the  University of Alaska Climate                                                                   
Project  and the  University  of  Alaska -  Fairbanks  Energy                                                                   
Technology Building.   With the  emphasis today on  Energy it                                                                   
was deemed more  appropriated to use federal  receipts on the                                                                   
Energy Technology  Building.  It has no impact  on the budget                                                                   
because  it  is  receipt  authority.    It  would  allow  the                                                                   
university  to begin the  project, seek  stimulus money,  and                                                                   
compete  for federal  grants  and private  money.   The  non-                                                                   
general fund amount would be sufficient  to begin the project                                                                   
and reduce  the amount  of state funds  needed to  finish the                                                                   
project.   This  funding is  similar  to how  the West  Ridge                                                                   
Research building was funded.                                                                                                   
                                                                                                                                
AT-EASE:       11:38:10 AM                                                                                                    
                                                                                                                                
RECONVENED:    11:38:57 AM                                                                                                    
                                                                                                                                
Co-Chair  Stedman noted  that this important  issue  would be                                                                   
worked on during the interim.                                                                                                   
                                                                                                                                
11:40:09 AM                                                                                                                   
                                                                                                                                
Senator Thomas thought  timing was everything.   He wanted to                                                                   
have assurance that it would happen.                                                                                            
                                                                                                                                
Senator Thomas WITHDREW Amendment 1.                                                                                            
                                                                                                                                
Co-Chair Stedman stated a commitment  from the Senate Finance                                                                   
co-chairs to  have the  Committee to work  on a multitude  of                                                                   
issues in Fairbanks this coming summer.                                                                                         
                                                                                                                                
AT-EASE:       11:41:05 AM                                                                                                    
                                                                                                                                
RECONVENED:    11:43:56 AM                                                                                                    
                                                                                                                                
KAREN  REHFELD, DIRECTOR,  OFFICE OF  MANAGEMENT AND  BUDGET,                                                                   
OFFICE OF THE  GOVERNOR, reported that yesterday  the revised                                                                   
spring forecast  was released,  which was not  much different                                                                   
that the  previous February version.   She spoke of  a desire                                                                   
to reduce  the amount of the draw  on reserves at the  end of                                                                   
the year.  The  current CS does make reductions  as proposed;                                                                   
however, there  are some  projects that  are missing.   Given                                                                   
the revenue  picture, the administration  is willing  to work                                                                   
on  addressing  those  projects  when  the  revenue  forecast                                                                   
improves.                                                                                                                       
                                                                                                                                
11:46:09 AM                                                                                                                   
                                                                                                                                
Ms. Rehfeld  hoped to  continue to  dialogue about  including                                                                   
the  funding  necessary  to  match  federal  and  other  fund                                                                   
sources.   In the  area of energy  and resource  development,                                                                   
the governor has  four specific projects and  priorities that                                                                   
are not  currently included  in the  CS that merit  continued                                                                   
discussion: the Alaska Spur Line  Project, the Dalton Highway                                                                   
Western  Alaska  Access,  and on-going  DNR  reservoir  study                                                                   
work.   The administration  supports  minimizing the  draw on                                                                   
the  reserve and  the  budget  with the  proposed  reductions                                                                   
included.                                                                                                                       
                                                                                                                                
11:47:31 AM                                                                                                                   
                                                                                                                                
Senator  Huggins asked  for more  information  on the  energy                                                                   
projects.                                                                                                                       
                                                                                                                                
Ms.   Rehfeld  repeated   the  requests   that  needed   more                                                                   
discussion:  the  Dalton Highway  -  Milepost  9-11, for  $26                                                                   
million; the Alaska gas spur line, for $8 million.                                                                              
                                                                                                                                
Senator  Huggins asked  if that  was for in-state  gas.   Ms.                                                                   
Rehfeld said  it was $8 million  that would go to  the Alaska                                                                   
Natural Gas Pipeline Development Authority (ANGDA).                                                                             
                                                                                                                                
Senator Huggins  expressed frustration about lack  of funding                                                                   
for the  railroad spur line.   He requested more  information                                                                   
about whether there  was a funding priority  for the railroad                                                                   
spur  line.   Ms.  Rehfeld recalled  funding  in last  year's                                                                   
budget for  the Point McKenzie  rail extension.  There  is no                                                                   
funding in the current CS.                                                                                                      
                                                                                                                                
Senator  Huggins pointed  out that  last year  there was  $20                                                                   
million for that  project, of which $2.5 million  was vetoed.                                                                   
He expressed  frustration about the  veto system.   He wished                                                                   
for further conversation on that subject.                                                                                       
                                                                                                                                
11:50:06 AM                                                                                                                   
                                                                                                                                
Co-Chair Hoffman  MOVED to  report SB 75,  Version T,  out of                                                                   
Committee with  individual recommendations.   There  being NO                                                                   
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
CSSB 75 (FIN) was REPORTED out  of Committee with a "do pass"                                                                   
recommendation.                                                                                                                 
                                                                                                                                
AT-EASE:       11:50:50 AM                                                                                                    
                                                                                                                                
RECONVENED:    11:54:08 AM                                                                                                    
                                                                                                                                
                                                                                                                                
SENATE BILL NO. 170                                                                                                           
                                                                                                                                
     "An  Act  modifying the  Alaska  unemployment  insurance                                                                   
     statutes to comply with the  requirements of the federal                                                                   
     economic  stimulus bill  by redefining  the base  period                                                                   
     for determining  eligibility for unemployment  benefits;                                                                   
     and providing for an effective date."                                                                                      
                                                                                                                                
Co-Chair Stedman  noted that this  was the second  hearing of                                                                   
the bill.  On April 7, Version S was adopted.                                                                                   
                                                                                                                                
Senator Ellis noted letters of  support for the bill from the                                                                   
National  Federation of  Independent  Business  and from  the                                                                   
Alaska State Chamber of Commerce (copies on file).                                                                              
                                                                                                                                
Co-Chair Hoffman  MOVED to report CSSB 170  (FIN), Version S,                                                                   
as amended, out of Committee with  individual recommendations                                                                   
and the accompanying fiscal note.                                                                                               
                                                                                                                                
There being NO OBJECTION, it was so ordered.                                                                                    
                                                                                                                                
CSSB  170 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass"  recommendation and  with zero  fiscal note  #1 by  the                                                                   
Department of Labor and Workforce Development.                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 11:56 AM.                                                                                          
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
CSSB 75 Version T summary spreadsheet.pdf SFIN 4/11/2009 11:00:00 AM
SB 75
CSSB 75 Verson T.pdf SFIN 4/11/2009 11:00:00 AM
SB 75
SB 75 Amendment 1 C.6.pdf SFIN 4/11/2009 11:00:00 AM
SB 75