Legislature(2021 - 2022)SENATE FINANCE 532

02/24/2022 09:00 AM Senate FINANCE

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                 SENATE FINANCE COMMITTEE                                                                                       
                     February 24, 2022                                                                                          
                         9:02 a.m.                                                                                              
9:02:36 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Bishop called the  Senate Finance Committee meeting                                                                    
to order at 9:02 a.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Senator Click Bishop, Co-Chair                                                                                                  
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson                                                                                                             
Senator Natasha von Imhof                                                                                                       
Senator Bill Wielechowski                                                                                                       
Senator David Wilson                                                                                                            
MEMBERS ABSENT                                                                                                                
ALSO PRESENT                                                                                                                  
Senator  Peter Micciche,  Sponsor; Madison  Govin, Staff  to                                                                    
Senator Micciche;  Kris Curtis, Legislative  Auditor, Alaska                                                                    
Division  of  Legislative  Audit; Jasmin  Martin,  Staff  to                                                                    
Senator   Wilson;   Keegan    Farone,   Staff   to   Senator                                                                    
PRESENT VIA TELECONFERENCE                                                                                                    
Dana  Walukiewicz, Alcohol  Beverage Board,  Anchorage; Glen                                                                    
Klinkhart, Interim  Director, Alcohol and  Marijuana Control                                                                    
Office,  Department  of  Commerce,  Community  and  Economic                                                                    
Development;  Dr. David  Logan,  Executive Director,  Alaska                                                                    
Dental  Society;  David  Nielson,  Chair,  Dental  Board  of                                                                    
Examiners;  Jayme  Parker,   Section  Chief,  Public  Health                                                                    
Laboratories,   Division  of  Public  Health, Department  of                                                                    
Health  and   Social  Services;  David   Guttenberg,  Former                                                                    
Legislator, Fairbanks;                                                                                                          
SB 151-EXTEND ALCOHOLIC BEVERAGE CONTROL BOARD                                                                                  
SB  151  was  HEARD  and   HELD  in  committee  for  further                                                                    
SB 173-DENTIST SPEC. LICENSE/RADIOLOGIC EQUIP                                                                                   
SB  173  was  HEARD  and   HELD  in  committee  for  further                                                                    
SJR 12-SOCIAL SECURITY BENEFIT REDUCTION REPEAL                                                                                 
SJR  12  was  HEARD  and   HELD  in  committee  for  further                                                                    
SENATE BILL NO.151                                                                                                            
     "An Act extending the termination date of the                                                                              
     Alcoholic Beverage Control Board; and providing for an                                                                     
     effective date."                                                                                                           
9:03:26 AM                                                                                                                    
Co-Chair Bishop relayed  that this was the  first hearing of                                                                    
SB 151, and  the intention of the committee was  to hear the                                                                    
bill, take  public and invited  testimony, and set  the bill                                                                    
9:03:56 AM                                                                                                                    
SENATOR  PETER   MICCICHE,  SPONSOR,  stated  that   SB  151                                                                    
proposed  a  relatively  simple   board  extension  for  the                                                                    
Alcoholic  Beverage Control  (ABC) Board.  He asserted  that                                                                    
the board was doing a good  job although was faced with some                                                                    
9:05:26 AM                                                                                                                    
MADISON  GOVIN, STAFF  TO SENATOR  MICCICHE, explained  that                                                                    
the  legislation would  extend the  termination date  of the                                                                    
board, which  was set to sunset  in 2022. She read  from the                                                                    
sponsor statement:                                                                                                              
     In  accordance  with the  provisions  of  Title 24  and                                                                    
     Title 44, Legislative Audit  reviewed the activities of                                                                    
     the ABC  Board and determined the  board is effectively                                                                    
     serving   the  public   interest  by   controlling  the                                                                    
     manufacture, barter, possession,  and sale of alcoholic                                                                    
     beverages in the state.                                                                                                    
     Findings  also   included  that  board   meetings  were                                                                    
     conducted  effectively,  regulations  were  adopted  to                                                                    
     implement  statutory changes,  and investigations  were                                                                    
     conducted in a timely manner.                                                                                              
She  urged   committee  support   of  the   legislation  and                                                                    
introduced Kris Curtis.                                                                                                         
9:06:57 AM                                                                                                                    
KRIS  CURTIS,   LEGISLATIVE  AUDITOR,  ALASKA   DIVISION  OF                                                                    
LEGISLATIVE AUDIT, relayed that  the Division of Legislative                                                                    
Audit  had completed  an audit  of  the ABC  Board (copy  on                                                                    
file). She detailed  that the division had  also conducted a                                                                    
special audit of the boards  licensing process. She directed                                                                    
committee  attention  to  the   conclusions  of  the  report                                                                    
located on Page 9 of the audit:                                                                                                 
     Overall,  the  audit  found that  board  meetings  were                                                                    
     conducted  effectively,  regulations  were  adopted  to                                                                    
     implement  statutory changes,  and investigations  were                                                                    
     conducted in a timely  manner. The audit also concluded                                                                    
     that the Alcohol and  Marijuana Control Office's (AMCO)                                                                    
     operations  were impeded  by the  lack of  an automated                                                                    
     application   process    and   significant   vacancies.                                                                    
     Further,  deficiencies  in   controls  over  processing                                                                    
     licensee fee refunds were identified.                                                                                      
     In  accordance with  AS 44.66.010(a)(1),  the board  is                                                                    
     scheduled to  terminate on June 30,  2022. We recommend                                                                    
     the legislature extend the  board's termination date to                                                                    
     June  30,  2026, which  is  four  years less  than  the                                                                    
     maximum  allowed  in  statute.  The  reduced  extension                                                                    
     reflects  the   need  for  more  timely   oversight  to                                                                    
     evaluate the  board's progress in  addressing licensing                                                                    
     inefficiencies and filling vacancies.                                                                                      
Ms. Curtis  pointed to Pages 14  and 15 of the  audit, which                                                                    
showed a schedule of licenses:                                                                                                  
     Based  on  data  provided by  Department  of  Commerce,                                                                    
     Community, and Economic  Development (DCCED) staff, the                                                                    
     board issued 1,177 catering and special                                                                                    
     event permits  from July 1, 2019,  through February 28,                                                                    
     2021. Testing of a sample  of 25 permits found all were                                                                    
     issued according to statutes.                                                                                              
     As  shown  in  Exhibit   2,  there  were  1,867  active                                                                    
     licenses as of February 28, 2021.                                                                                          
     In February  2021, AMCO staff issued  approximately 300                                                                    
     temporary  licenses  for   the  license  period  ending                                                                    
     December 31,  2020, due to an  application backlog that                                                                    
     was  the   result  of  limited  staff   resources.  The                                                                    
     temporary licenses allowed                                                                                                 
     licensees to  continue operating pending review  of the                                                                    
     renewal   applications.    Auditors   reviewed   AMCO's                                                                    
     staffing during  the audit  period and  found extensive                                                                    
     vacancies. Exhibit  3 displays staffing  vacancies that                                                                    
     exceeded two months during the audit period.                                                                               
Ms.  Curtis  stated that  AMCO  reported  7 staff  positions                                                                    
vacant for a total of 92  months from FY 18 through February                                                                    
29,  2021. She  shared that  the reasons  for the  vacancies                                                                    
included,  not  hiring  due  to  uncertainty  surrounding  a                                                                    
proposal to  merge AMCO with  the Division  of Corporations,                                                                    
Business, and Professional Licensing,  not hiring due to the                                                                    
unknown  impact of  the pandemic  on the  industry, and  not                                                                    
hiring for one position  that was transferred form Fairbanks                                                                    
to the Mat-Sue  due to the inability to  find workspace. She                                                                    
said that the extended  vacancies negatively impacted AMCOs                                                                     
ability to support the ABC board, as well as the AMCO.                                                                          
Ms. Curtis turned  to Page 16 of the  audit. She highlighted                                                                    
3 of the 5 troublesome aspects of the application process:                                                                      
     Five  main  aspects  of the  application  process  were                                                                    
     found  to delay  or potentially  delay license  review,                                                                    
     approval, and/or issuance.                                                                                                 
     1.  Application  completeness   and  accuracy:  License                                                                    
     requirements  are   complex,  making   the  application                                                                    
     process  complicated and  inherently subject  to error.                                                                    
     Further, the  applications must be  submitted manually.                                                                    
     As  such, the  applications are  not subject  to online                                                                    
     edits designed  to help limit  errors. Analysis  of the                                                                    
     505  applications  received  during  the  audit  period                                                                    
     found applications  were incomplete and/  or inaccurate                                                                    
     at a  rate of  96 percent for  new applications  and 97                                                                    
     percent  for  transfer  applications.  Once  determined                                                                    
     deficient,  the  applications  are  sent  back  to  the                                                                    
     applicants   for  correction.   Returning  applications                                                                    
     added, on average, 20 days to AMCO's review process.                                                                       
     4.  Submittal of  compliance information  by applicable                                                                    
     entities: Approval  of 48  percent of  new applications                                                                    
     and  55 percent  of transfer  applications was  delayed                                                                    
     due  to protest  by a  local governing  body or  due to                                                                    
     waiting  for receipt  of compliance  information (i.e.,                                                                    
     state fire marshal approval;  building, zoning, or food                                                                    
     safety  permits;  or  notice  from  creditors).  Delays                                                                    
     associated  with   waiting  for  receipt   of  required                                                                    
     information  added  an  average  of  88  days  for  new                                                                    
     licenses and 35 days for transfer licenses.                                                                                
     5. Issuance of licenses by  AMCO staff: The audit found                                                                    
     that  AMCO staff  issued new  and transfer  licenses an                                                                    
     average  of 23  days and  28 days,  respectively, after                                                                    
     all outstanding requirements were met.                                                                                     
9:10:14 AM                                                                                                                    
Ms. Curtis referenced five recommendations starting on page                                                                     
     Recommendation No. 1:                                                                                                    
    The Department of Commerce, Community, and Economic                                                                         
     Development  (DCCED)  commissioner should  ensure  AMCO                                                                    
     vacancies are  filled in a  timely manner and  the AMCO                                                                    
     director    should    implement    written    licensing                                                                    
     Recommendation No. 2:                                                                                                    
     The board  should significantly enhance or  replace its                                                                    
     licensing   database  and   automate  the   application                                                                    
     process where possible.                                                                                                    
     Recommendation No. 3:                                                                                                    
     The   board  and   AMCO   director  should   strengthen                                                                    
     procedures  for entering  restricted purchasers  in the                                                                    
     statewide database of written orders.                                                                                      
     Recommendation No. 4:                                                                                                    
     The   board   and   AMCO  director   should   implement                                                                    
     procedures to  ensure municipalities  receiving refunds                                                                    
     of biennial license fees are actively enforcing                                                                            
     alcoholic beverage laws.                                                                                                   
     Recommendation No. 5:                                                                                                    
     The AMCO director should improve procedures and fill                                                                       
     vacancies in a timely manner to ensure refunds to                                                                          
     municipalities are appropriately reviewed.                                                                                 
9:12:58 AM                                                                                                                    
Ms.  Curtis relayed  that the  responses to  the audit  were                                                                    
found on  page 47.  Ms. Curtis  summarized. The  ABC Board's                                                                    
response was  found on page  49. She related that  the chair                                                                    
of the  board strongly  disagreed with the  4-year extension                                                                    
and  claimed  that  an early  sunset  would  jeopardize  the                                                                    
publics   trust  and  undermine  confidence  in  the  public                                                                    
process. He  believed that the  finding s were  not material                                                                    
enough to warrant a reduced extension.                                                                                          
9:14:06 AM                                                                                                                    
Senator Hoffman asked whether the  chairman of the board had                                                                    
addressed Recommendation 3.                                                                                                     
Ms.  Curtis  relayed that  the  chair  had agreed  with  the                                                                    
Senator Hoffman thought the finding was serious in nature.                                                                      
Ms. Curtis  stated that similar  to the prior  sunset audit,                                                                    
it had  been found  that procedures  were not  strong. There                                                                    
had been  miscommunication between the court  system and the                                                                    
AMCO Office.                                                                                                                    
Senator Hoffman had the viewpoint  that if the board did not                                                                    
recognize  the seriousness  of the  issue there  would be  a                                                                    
need for  corrective action, such  as withholding  per diem.                                                                    
He  thought that  not  addressing non-compliant  individuals                                                                    
was ignoring the problem.                                                                                                       
Ms. Curtis noted that the  commissioner reported that all 27                                                                    
have now been entered into the database.                                                                                        
9:16:32 AM                                                                                                                    
Senator  Olson  asked the  reason  for  vacancies not  being                                                                    
Ms. Curtis reiterated the reasons  offered by the board. She                                                                    
commented  that there  was an  extreme number  of vacancies,                                                                    
and it was "fairly shocking."                                                                                                   
Senator Olson asked  whether there had been  another time in                                                                    
which there were  as great a number of vacancies,  or a time                                                                    
when the  board chair had  so strongly disagreed  with audit                                                                    
Ms.  Curtis relayed  that  over the  previous  20 years  the                                                                    
board had received  a 3 to 4-year  extension multiple times.                                                                    
She thought it was not  surprising given the addition of the                                                                    
Marijuana Control Board. She could  not recall a time when a                                                                    
board   chair   had   so   strongly   disagreed   with   the                                                                    
9:18:33 AM                                                                                                                    
Co-Chair Bishop recalled that Ms.  Curtis had mentioned that                                                                    
a position had  been moved from Fairbanks to  the Mat-Su. He                                                                    
asked her to repeat the reference.                                                                                              
Ms. Curtis stated that one  of the positions that was vacant                                                                    
was  because  the position  had  been  moved and  they  were                                                                    
having trouble finding workspace in Mat-Su.                                                                                     
Co-Chair Bishop opened INVITED testimony.                                                                                       
9:19:22 AM                                                                                                                    
DANA  WALUKIEWICZ, ALCOHOL  BEVERAGE  BOARD, ANCHORAGE  (via                                                                    
teleconference), spoke  in favor of the  bill and encouraged                                                                    
the  committee to  consider extending  the termination  date                                                                    
for 6 years. He stressed that  the board did not dispute the                                                                    
nature   of   the   audit    findings,   but   the   overall                                                                    
recommendation   of   a   shortened   term.   He   mentioned                                                                    
Recommendation 3, and  admitted it was an  important step to                                                                    
include  offenders in  the database.  He  drew attention  to                                                                    
page 30:                                                                                                                        
     Additionally, due  to miscommunication and  turnover of                                                                    
     key  agency   staff,  reports  of  convictions   of  AS                                                                    
     04.11.010 violations were  not consistently provided by                                                                    
     the court system.                                                                                                          
Mr.  Walukiewicz  explained  that  the  issue  stemmed  from                                                                    
several years prior  when the previous director  had not had                                                                    
great communication  with other  agencies. He  asserted that                                                                    
and communication  had improved  dramatically under  the new                                                                    
director. He  shared that all  of the  restricted purchasers                                                                    
were now in the consistently updated database.                                                                                  
Mr.  Walukiewicz   mentioned  the  vacancy  issue   and  the                                                                    
reference  to a  possible  merge of  functions  of the  AMCO                                                                    
office and the  DCCED licensing division. He  noted that the                                                                    
matter  was   an  administrative  directive  that   was  not                                                                    
necessarily supported by the board.  He related that the job                                                                    
postings  were  being  prepared,   but  not  posted  by  the                                                                    
appropriate parties  in DCCED.  He said  that the  issue was                                                                    
resolved, and the positions were filled.                                                                                        
Mr.  Walukiewicz   explained  that  the   communication  and                                                                    
cooperating  with the  department had  improved. He  pointed                                                                    
out to  the committee that  subsequent to the  audit period,                                                                    
all staffing positions had been filled.                                                                                         
9:24:05 AM                                                                                                                    
Mr. Walukiewicz  explained that 4  of the  5 recommendations                                                                    
had  been  addressed before  the  report  was published.  He                                                                    
noted that the  board and AMCO did not dispute  the need for                                                                    
a new  automated application processing system.  The alcohol                                                                    
application process was preformed by  3 people and was paper                                                                    
based.  He stressed  that the  board and  the staff  were in                                                                    
full support  of an  automated system but  did not  have the                                                                    
funds to implement such a  system. He said there was funding                                                                    
available contingent on the passage  of SB 9. He stated that                                                                    
a follow-up  audit would  be welcome and  did not  feel like                                                                    
the issues  in the  current audit should  limit the  time of                                                                    
the board.  He felt that  a shortened term would  hamper the                                                                    
work of the board.                                                                                                              
9:27:24 AM                                                                                                                    
Senator Wilson identified the  issue of application accuracy                                                                    
and  completeness.  He recalled  an  inaccuracy  rate of  97                                                                    
percent,  which he  believed  was high.  He  asked what  Mr.                                                                    
Walukiewicz how  the issue of application  accuracy could be                                                                    
Mr. Walukiewicz  explained that the application  process was                                                                    
paper-based and  very detailed. Much of  the information had                                                                    
to  be cross-checked  with various  databases. He  said that                                                                    
having an electronic submission  process that was integrated                                                                    
with other state databases would streamline the process.                                                                        
Mr.  Walukiewicz  continued   to  address  Senator  Wilson's                                                                    
question. He said  that one had to  understand the statutes,                                                                    
regulations,  and  nuances   associated  with  each  license                                                                    
application. He  summarized that the board  was hopeful that                                                                    
the  automated  system  would  cut   the  error  rate  to  a                                                                    
manageable level.                                                                                                               
9:30:35 AM                                                                                                                    
Senator Wilson  did not  see how  an automated  system would                                                                    
help  the applicant.  He wondered  whether  the board  would                                                                    
provide technical assistance to applicants.                                                                                     
Mr. Walukiewicz relayed that there  was also a position that                                                                    
assisted with the roll-out  of applications and regulations.                                                                    
He said that due to staffing  issues, there was not as great                                                                    
of outreach to  the industry to assist with  forms. He added                                                                    
that now  that the board  was fully staffed,  he anticipated                                                                    
there would  be more  outreach that would  provide guidance.                                                                    
He was certain matters would  be simplified with the passage                                                                    
of SB 9.                                                                                                                        
9:32:37 AM                                                                                                                    
Co-Chair  Stedman  commented  that the  board  should  worry                                                                    
about  the legislature  eliminating  the board  in 2026.  He                                                                    
relayed  that  it was  helpful  to  have another  review  as                                                                    
proposed in four  years. He thought that if  the issues were                                                                    
resolved the next extension would be longer.                                                                                    
9:33:34 AM                                                                                                                    
Senator Olson  agreed with  Co-Chair Stedman.  He referenced                                                                    
the high cost of another audit.                                                                                                 
9:34:31 AM                                                                                                                    
Senator  Wilson  asked  whether the  board  still  practiced                                                                    
fairness  in  decision  making  or  were  appeals  based  on                                                                    
Mr.  Walukiewicz  could not  speak  for  the previous  board                                                                    
chair. He asserted  that while he had been on  the board, he                                                                    
had  been  committed  to  strictly  following  statutes  and                                                                    
regulations. He said that  applications were examined solely                                                                    
on merit and  license availability. He noted  that the board                                                                    
was completely  new as  of the last  12 months.  He stressed                                                                    
the professionalism of the board members.                                                                                       
9:38:09 AM                                                                                                                    
Co-Chair  Bishop  asked about  the  position  that had  been                                                                    
moved  from  Fairbanks  to  Mat-Su.  He  asked  whether  the                                                                    
position was still vacant.                                                                                                      
Mr. Walukiewicz  deferred to Glen Klinkhart.  He shared that                                                                    
there were no enforcement related  findings in the audit and                                                                    
all of the administrative staff was housed in Anchorage.                                                                        
9:39:51 AM                                                                                                                    
GLEN  KLINKHART,  INTERIM  DIRECTOR, ALCOHOL  AND  MARIJUANA                                                                    
CONTROL  OFFICE,  DEPARTMENT   OF  COMMERCE,  COMMUNITY  AND                                                                    
ECONOMIC  DEVELOPMENT  (via  teleconference),  relayed  that                                                                    
there had been  a spot open in Fairbanks that  was filled by                                                                    
an investigator  but due to  organizational issues  the spot                                                                    
had to be moved to Wasilla.                                                                                                     
9:41:43 AM                                                                                                                    
Senator Wilson asked how Mr.  Klinkhart felt about the board                                                                    
being able to make  decisions regarding the applicability of                                                                    
Mr. Klinkhart  stressed that the board  followed statute and                                                                    
had a qualified Assistant  Attorney general present at every                                                                    
meeting.  He  felt  that  there  was  confusion  surrounding                                                                    
licensing  and population  numbers. He  said that  the board                                                                    
had  established  guidelines  for signature  gathering  that                                                                    
simplified the process.                                                                                                         
9:44:51 AM                                                                                                                    
Co-Chair Bishop OPENED public testimony.                                                                                        
9:45:07 AM                                                                                                                    
Co-Chair Bishop CLOSED public testimony.                                                                                        
Co-Chair Bishop relayed that //                                                                                                 
SB  151  was  HEARD  and   HELD  in  committee  for  further                                                                    
SENATE BILL NO. 173                                                                                                           
     "An Act relating to the practice of dentistry;                                                                             
     relating to dental radiological equipment; and                                                                             
     providing for an effective date."                                                                                          
9:45:25 AM                                                                                                                    
Co-Chair Bishop  invited the bill  sponsor and staff  to the                                                                    
9:46:03 AM                                                                                                                    
Senator  David  Wilson,  Sponsor, explained  that  the  bill                                                                    
would  transfer  dental radiological  equipment  inspections                                                                    
from  the Board  of Dental  Examiners to  the Department  of                                                                    
Health and  Social Services and would  establish a specialty                                                                    
dental license  in the State  of Alaska. He stated  that the                                                                    
changes  had  been  suggested  by   members  of  the  dental                                                                    
industry  and   had  been   seen  in   previous  legislation                                                                    
considered  by the  committee. He  stated  that the  updates                                                                    
were in the interest of public safety.                                                                                          
9:47:22 AM                                                                                                                    
JASMIN MARTIN,  STAFF TO SENATOR WILSON,  reiterated the two                                                                    
changes that would occur under the legislation.                                                                                 
9:49:16 AM                                                                                                                    
Senator Olson wondered whether the  bill was directed toward                                                                    
personnel or equipment inspection.                                                                                              
Ms.  Martin  replied  that  the  bill  was  directed  toward                                                                    
equipment inspection.                                                                                                           
Senator  Olson wondered  whether  adding the  responsibility                                                                    
under DHSS would be an additional burden to the department.                                                                     
Ms. Martin  said that the  bill would create a  new position                                                                    
to take on the additional work.                                                                                                 
Senator Olson asked whether there had been any past                                                                             
violations that had caused loss of a license.                                                                                   
Senator Wilson responded that no one had lost a license                                                                         
yet, but that it would happen soon as there were some                                                                           
licensees that were out of compliance.                                                                                          
Senator Olson found it troublesome that someone could be                                                                        
threatened with closure due to a change in statute.                                                                             
Ms. Martin relayed that inspection of equipment was already                                                                     
a requirement under statute.                                                                                                    
9:51:34 AM                                                                                                                    
Ms. Martin addressed a sectional analysis document (copy on                                                                     
    Section 1: Conforming language in AS 08.01.065(c).                                                                        
     Section  2: Adds  a  new section  (k)  to AS  08.01.065                                                                  
     (Title   8.  Business   and  Professions,   Chapter  1.                                                                    
     Centralized  Licensing, Section  065. Establishment  of                                                                    
     fees)  Requires  the  Board   of  Dental  Examiners  to                                                                    
     establish and collect fees on  behalf of the Department                                                                    
     of  Health and  Social Services  for the  inspection of                                                                    
     dental radiological equipment.                                                                                             
Ms. Martin continued with the sectional:                                                                                        
     Section  3: Adds  new sections  to AS  08.36 (Title  8.                                                                  
     Business  and Professions,  Chapter  36. Dentistry)  AS                                                                    
     08.36.242.   License  to   practice  as   a  specialist                                                                    
     required. Establishes that a  dentist may not advertise                                                                    
     using the  term "specialist," the name  of a specialty,                                                                    
     or  other phrases  that suggest  they are  a specialist                                                                    
     unless they have a specialist license as established.                                                                      
     AS  08.36.243. Qualification  for specialist;  scope of                                                                    
     (a)  Establishes  that  in  order   to  qualify  for  a                                                                    
     specialist licenses a person must                                                                                          
     (1) Hold a dental license issued by the board and                                                                          
     (2)  Meet   the  qualifications  of  a   specialist  as                                                                    
     established by the board                                                                                                   
     in regulation.                                                                                                             
     (b)  In creating  the qualifications  for a  specialist                                                                    
     license, the board shall                                                                                                   
     consider  the  standards  of  a  nationally  recognized                                                                    
     certifying entity approved                                                                                                 
     by the board.                                                                                                              
     (c)  Establishes  that  a dental  specialist  can  only                                                                    
     claim to be  a specialist in the specialty  they hold a                                                                    
     license in.                                                                                                                
     Sec. 08.36.245. Suspension  or revocation of specialist                                                                    
     Establishes  that  a  board may  suspend  or  revoke  a                                                                    
     specialist license as set by                                                                                               
     AS 08.36.315.                                                                                                              
Ms. Martin continued to address the sectional analysis:                                                                         
     Section  4: Adds  a  new section  (d)  to AS  44.29.020                                                                  
     (Title 44. State Government,  Chapter 29. Department of                                                                    
     Health and  Human Services, Section 020.  Duties of the                                                                    
     Department)  Requires DHSS  to  establish standards  of                                                                    
     registration,  use, record  keeping, and  inspection of                                                                    
     dental  radiological   equipment  in   compliance  with                                                                    
     federal law.                                                                                                               
     Section 5: Conforming language in AS 44.46.029                                                                           
     Section 6: Conforming language in AS 46.03.022                                                                           
     Section  7:  Repeals:  AS  08.36.075:  Section  of  law                                                                  
     requiring  the   Board  of  Dental  Examiners   to  set                                                                    
     standards   for  inspection   of  dental   radiological                                                                    
     equipment.  Placed   under  DHSS   by  section   4.  AS                                                                    
     18.05.065, AS 18.60.525(e),  and AS 44.29.027: Sections                                                                    
     of   law  prohibiting   DHSS  from   regulating  dental                                                                    
     radiological equipment.                                                                                                    
     Section 8:  Allows the Board  of Dental  Examiners, the                                                                  
     Department   of  Commerce,   Community,  and   Economic                                                                    
     Development, and  the Department  of Health  and Social                                                                    
     Services to adopt regulations in line with this act.                                                                       
     Section  9:   Allows  the  departments  and   board  to                                                                  
     immediately begin setting regulations.                                                                                     
     Section 10: Set  a delayed effective date  for the rest                                                                  
     of the act to July 1, 2023.                                                                                                
Co-Chair  Bishop asked  whether the  delayed effective  date                                                                    
was  synched  up  to  when  the  new  regulations  would  be                                                                    
Ms. Martin deferred to the department.                                                                                          
9:54:10 AM                                                                                                                    
Senator  von  Imhof had  questions  about  Section 3,  which                                                                    
established  that  the  board  could  suspend  or  revoke  a                                                                    
license. She  assumed there were  dentists that  had claimed                                                                    
to   be  specialists   without  having   gone  through   the                                                                    
certification process.                                                                                                          
Ms. Martin answered "yes."                                                                                                      
Senator von  Imhof asked whether there  were other penalties                                                                    
that could be issued once the statute changes.                                                                                  
Ms. Martin deferred  the question to the chair  of the Board                                                                    
of Dentistry.                                                                                                                   
9:55:55 AM                                                                                                                    
DR. DAVID  LOGAN, EXECUTIVE DIRECTOR, ALASKA  DENTAL SOCIETY                                                                    
(via teleconference), noted that  he would focus his remarks                                                                    
on the  x-ray inspection  aspect of  the bill.  He explained                                                                    
that there were dentists that  could face a compliance issue                                                                    
at the end  of the calendar year. He said  that the industry                                                                    
had  been unable  to find  a private  contractor to  perform                                                                    
inspections  in  the  state.  He  said  that  the  need  was                                                                    
recognized  and  attempts to  find  an  inspector have  been                                                                    
fruitless, which  prompted the  shift of  the responsibility                                                                    
to  DHSS. He  said that  inspectors had  to be  specifically                                                                    
trained for the job.                                                                                                            
9:58:14 AM                                                                                                                    
Senator Olson asked about the  alleged shortage of qualified                                                                    
inspectors in  the state.  He asked how  the issue  could be                                                                    
Mr. Logan  thought it would  be difficult to  get inspectors                                                                    
into the  state on a  part-time basis. He believed  that the                                                                    
hiring of the position would be best handled by the state.                                                                      
Senator Olson asked  about how dentists in  rural Alaska and                                                                    
in   Tribal   health   corporations  had   their   equipment                                                                    
Mr.  Logan noted  there were  state certified  inspectors on                                                                    
staff at those facilitate.                                                                                                      
10:00:27 AM                                                                                                                   
DAVID  NIELSON,  CHAIR,  DENTAL   BOARD  OF  EXAMINERS  (via                                                                    
teleconference), thanked Senator  Wilson for introducing the                                                                    
bill. He  referenced He stated  that order for the  board to                                                                    
address  licensing  issues, specialty  licensing  categories                                                                    
were need, that could hold  up under scrutiny. He noted that                                                                    
typically a  post-graduate included at least  two additional                                                                    
years  after   dentistry  school.  Ha  said   that  lack  of                                                                    
specificity in  the statute had  resulted din the  denial of                                                                    
specialist   practice  licensees.   He  believed   that  the                                                                    
legislation  would give  the public  a way  to know  whether                                                                    
they were being treated by a certified specialist.                                                                              
10:04:25 AM                                                                                                                   
Co-Chair Bishop OPENED public testimony.                                                                                        
10:04:51 AM                                                                                                                   
JAYME  PARKER, SECTION  CHIEF,  PUBLIC HEALTH  LABORATORIES,                                                                    
DIVISION OF  PUBLIC HEALTH, DEPARTMENT OF  HEALTH AND SOCIAL                                                                    
SERVICES   (via   teleconference),    testified   that   the                                                                    
radiological  program  at  the state  health  lab  currently                                                                    
oversees 1000 devices across the  state. She stated that the                                                                    
work was  done by a  single health physicist. She  said that                                                                    
to take on  the estimated 2,200 to  2,400 additional devices                                                                    
the division  would need  an additional  radiological health                                                                    
physicist and a part-time  administrator to help with travel                                                                    
and outreach.  She relayed that  while the division  had the                                                                    
capability to  the work, they  lacked capacity.  She related                                                                    
that the devices were only  required to be inspected every 6                                                                    
years,  which meant  that inspections  could be  broken down                                                                    
into approximately 400 per year.                                                                                                
10:06:44 AM                                                                                                                   
Co-Chair Bishop CLOSED public testimony.                                                                                        
10:06:49 AM                                                                                                                   
AT EASE                                                                                                                         
10:07:12 AM                                                                                                                   
Senator Wilson urged the committee to support the bill.                                                                         
SB 173 was HEARD and HELD in committee for further                                                                              
10:07:54 AM                                                                                                                   
AT EASE                                                                                                                         
10:09:42 AM                                                                                                                   
SENATE JOINT RESOLUTION NO. 12                                                                                                
     Urging  the  United  States   Congress  to  repeal  the                                                                    
     Windfall Elimination  Provision and  Government Pension                                                                    
     Offset of the Social Security Act.                                                                                         
10:09:44 AM                                                                                                                   
Co-Chair Bishop relayed that it was the first hearing of                                                                        
SJR 12.                                                                                                                         
10:10:13 AM                                                                                                                   
Senator Bill Wielechowski, Sponsor, explained that SJR 12:                                                                      
      SJR  12   urges  Congress   to  repeal   the  Windfall                                                                    
     Elimination  Provision  (WEP)  and  Government  Pension                                                                    
     Offset (GPO) of  the Social Security Act.  The WEP cuts                                                                    
     the  Social Security  benefits of  public employees  in                                                                    
     Alaska  if  they  plan to  switch  between  the  public                                                                    
     sector and  private sector or  military. In  2021, this                                                                    
     loss  could be  as much  as  $498 per  month, or  about                                                                    
     $6,000  a  year.  The  GPO   cuts  spousal  or  widows'                                                                    
     benefits for public employees for  no reason other than                                                                    
     their work in the public  sector. This cut could amount                                                                    
     to  as much  as 2/3rds  the value  of the  individual's                                                                    
     government pension.                                                                                                        
     Because  Alaska is  one  of few  states  that does  not                                                                    
     offer  a defined  benefit plan  or coverage  for social                                                                    
     security,  the WEP  and GPO  affect  more Alaskans  per                                                                    
     capita  than  any  other  state.  Public  employees  in                                                                    
     Alaska  are  being punished  for  choosing  to work  in                                                                    
     public  service.  The  WEP and  GPO  negatively  impact                                                                    
     recruitment  and retention  of Alaska  public employees                                                                    
     such  as firefighters,  police officers  and especially                                                                    
     teachers. Those who do not  want to be subject to these                                                                    
     provisions will  simply look elsewhere  for employment.                                                                    
     Punishing individuals for  choosing public service runs                                                                    
     counter  to  retaining  dedicated Alaskan  workers  and                                                                    
     recruiting the best of the best to Alaska.                                                                                 
     Passage  of SJR  12  will demonstrate  that the  Alaska                                                                    
     Legislature opposes  arbitrary and  unfair cuts  to the                                                                    
     rightfully   earned   Social   Security   benefits   of                                                                    
     Alaskans deserve  to retire with  dignity. I  urge your                                                                    
     support of SJR 12.                                                                                                         
10:12:29 AM                                                                                                                   
Co-Chair Bishop asked about the Windfall Elimination                                                                            
Provision (WPE).                                                                                                                
Senator Wielechowski explained that the WPE would be                                                                            
further discussed in the presentation.                                                                                          
10:12:52 AM                                                                                                                   
KEEGAN FARONE, STAFF TO SENATOR WIELECHOWSKI, discussed a                                                                       
presentation entitled "Senate Joint Resolution 12, Senator                                                                      
Wielechowski, 24 Feb 2022," (copy on file).                                                                                     
Mr.   Farone   showed   slide   2,   "Windfall   Elimination                                                                    
     • The Windfall Elimination Provision (WEP) was enacted                                                                     
      in 1983 by the Social Security Administration.                                                                            
     • The WEP reduces Social Security benefit payments to                                                                      
        beneficiaries  whose  work  histories  include  both                                                                    
        Social Securitycovered  and  non-covered employment,                                                                    
        with  the  non-covered  employment   also  providing                                                                    
        pension coverage.                                                                                                       
     • WEP reductions could amount to nearly $75 million                                                                        
        annually for affected Alaskans.                                                                                         
     • In Alaska, the WEP potentially affects any public                                                                        
        employee who is also eligible for Social Security.                                                                      
Mr. Farone addressed slide 3:                                                                                                   
        • For the first bend in average annual earnings,                                                                        
          the  WEP  reduces  the replacement  rate  from  90                                                                    
          percent to as low as  40 percent, depending on the                                                                    
          quantity   of  years   of  qualified   substantial                                                                    
         earnings under Social Security coverage.                                                                               
Mr. Farone estimated  that WEP reductions could  result in a                                                                    
$75 million reduction annually for affected Alaskans.                                                                           
10:13:32 AM                                                                                                                   
Co-Chair  Bishop asked  whether the  $75 million  figure had                                                                    
been  provided  by  the  sponsor   or  the  Social  Security                                                                    
Mr. Farone replied  that the estimate was based  on the $498                                                                    
per month,  multiplied by the  number of  Alaskans  affected                                                                    
by the WEP.                                                                                                                     
Co-Chair  Bishop  added  that  the  number  included  direct                                                                    
payments and not indirect payments.                                                                                             
Mr. Farone agreed.                                                                                                              
10:14:41 AM                                                                                                                   
Mr. Farone reiterated that the first bend from slide 3.                                                                         
10:15:10 AM                                                                                                                   
Mr. Farone  relayed that the Three  Bend Formula constituted                                                                    
the  primary insurance  amount (PIA),  which was  the amount                                                                    
paid  to a  retiree at  full  retirement age.  He said  that                                                                    
under the WEP there would be  no reductions in the second or                                                                    
third bend of the formula, only the first bend.                                                                                 
10:15:32 AM                                                                                                                   
Mr.  Farone   spoke  to   slide  4,   "Windfall  Elimination                                                                    
          • The WEP affects more Alaskans per capita than                                                                       
             any other state.                                                                                                   
          • Reductions under the WEP may equate to as much                                                                      
             as $498 per month, or approximately $5,976                                                                         
Mr.  Farone shared  that there  were 12,000  retired workers                                                                    
affected by  the WEP,  60 of which  were disabled,  478 were                                                                    
spouses  and  children,   which  combined  constituted  11.6                                                                    
percent  of   all  Alaskan  social   security  beneficiaries                                                                    
affected by the WEP.                                                                                                            
10:16:03 AM                                                                                                                   
Co-Chair Stedman  went back  to slide 3.  He shared  that he                                                                    
supported  the   resolution.  He   thought  the   issue  was                                                                    
surprising to many  who did not realize it  existed until it                                                                    
was  directly affecting  their social  security payout.   He                                                                    
asked  Mr. Farone  to explain  Table 3  on slide  3, without                                                                    
Mr.    Farone   explained    that   the    Social   Security                                                                    
Administration  had   a  chart   that  indicated   what  the                                                                    
considered  to  be  substantial  earnings,  which  increased                                                                    
yearly. He  said that if a  person did not have  at least 30                                                                    
years of what the  social security administration considered                                                                    
to  be  substantial  earnings, for  every  year  below  that                                                                    
number  90  percent of  the  first  $996  was reduced  by  5                                                                    
Co-Chair  Stedman believed  that the  practice was  called a                                                                    
 social security offset.                                                                                                        
Mr. Farone clarified that the practice was called the WEP.                                                                      
10:17:52 AM                                                                                                                   
Co-Chair  Bishop  asked about  slide  4.  He wondered  about                                                                    
Alaskas anomalous number of per capita workers.                                                                                 
Mr.  Farone agreed  that Alaska  had the  most workers,  per                                                                    
captia, affected by the WEP.                                                                                                    
10:18:15 AM                                                                                                                   
Mr. Farone showed slide 5, "Government Pension Offset":                                                                         
   Government Pension Offset                                                                                                  
     • The Government Pension Offset (GPO) reduces Social                                                                       
        Security benefits paid to spouses  or survivors when                                                                    
        the spouse  or  survivor  earned  a pension  from  a                                                                    
        government  job  that  was  not  covered  by  Social                                                                    
     • Unlike the WEP, which can apply to any non-covered                                                                       
        employment,  the   GPO   applies   specifically   to                                                                    
        government workers' retirement benefits.                                                                                
     • Although pensions mitigate the effect of the WEP                                                                         
        adjustment to  Social  Security  benefits,  pensions                                                                    
        from   noncovered   employment   trigger   the   GPO                                                                    
        adjustment, which  reduces the  spouse and  survivor                                                                    
10:18:53 AM                                                                                                                   
Mr. Farone spoke to slide 6, "Government Pension Offset":                                                                       
     Under  the GPO,  the  reduction may  equal  up to  two-                                                                    
     thirds of the  value of the pension  in noncovered work                                                                    
     and  may  wipe-out  the   spouse  or  survivor  benefit                                                                    
Mr. Farone  spoke to the  chart on  slide 6, noting  that it                                                                    
was  a  hypothetical  example  of   the  GPO  reduction.  He                                                                    
explained that if there was  a covered worker with an $1,800                                                                    
benefit, the  spousal benefit before  GPO would be  $900. If                                                                    
the spousal  benefit included  a $1000  non-covered pension,                                                                    
the two-third reduction of the  $900 would leave a remaining                                                                    
benefit of  $233. This was  called a  partial offset.   In a                                                                    
 full  offset   if  the  GPO was  larger  than  the  spousal                                                                    
benefit, no benefit would be paid.                                                                                              
10:20:00 AM                                                                                                                   
Mr. Farone addressed slide 7, "Government Pension Offset":                                                                      
        • In 2020, 3,322 Alaskans were subject to GPO                                                                           
          reductions,  2,419  of  which were  fully  offset,                                                                    
          meaning   those   affected  received   no   Social                                                                    
          Security  spousal  or survivor's  benefit  because                                                                    
          the  reduction   was  greater  than   the  benefit                                                                    
Mr.  Farone added  that 43  percent of  those affected  were                                                                    
widows or widowers.                                                                                                             
10:20:52 AM                                                                                                                   
Mr. Farone referenced slide 8, "Conclusion":                                                                                    
     SJR 12 is designed to protect employees whose work was                                                                     
     contracted under the premise that their dedication to                                                                      
     public service would be rewarded upon their                                                                                
     Although the WEP and the GPO were enacted to address                                                                       
     one inequality, they inadvertently created                                                                                 
     another. Legislators must right this wrong and                                                                             
     ensure that individuals are not forced to choose                                                                           
     between serving the public good or retiring with                                                                           
     financial stability.                                                                                                       
10:21:14 AM                                                                                                                   
Senator  von  Imhof  wondered   whether  the  United  States                                                                    
Congress would  pay attention to  the resolution  should the                                                                    
legislature pass the bill.                                                                                                      
Senator  Wielechowski thought  many Alaskans  were concerned                                                                    
about  the  issue.  He  relayed  that  President  Biden  had                                                                    
expressed support  for eliminating the  GPO and the  WEP. He                                                                    
believed  that  legislation  had   been  introduced  on  the                                                                    
federal level.                                                                                                                  
Co-Chair  Bishop   commented  that  the   state  legislature                                                                    
advocating a position helped  guide state representatives on                                                                    
the federal level.                                                                                                              
10:23:00 AM                                                                                                                   
Senator von  Imhof thought  it would be  helpful to  see the                                                                    
status of the related federal legislation.                                                                                      
Senator Wielechowski agreed to provide the information.                                                                         
10:23:37 AM                                                                                                                   
Co-Chair Bishop OPENED public testimony.                                                                                        
10:24:03 AM                                                                                                                   
AT EASE                                                                                                                         
10:24:12 AM                                                                                                                   
DAVID   GUTTENBERG,   FORMER  LEGISLATOR,   FAIRBANKS   (via                                                                    
teleconference),  wanted to  share his  experience with  the                                                                    
WEP.  He had  experienced  a $500  per  month penalty  after                                                                    
retirement, which  was a significant  amount of  his monthly                                                                    
retirement.  He  felt  that  it  was  fair  to  receive  the                                                                    
benefits  one had  already paid  into. He  thought that  the                                                                    
underlying factor was the management  of social security. He                                                                    
reiterated  that the  WEP took  away money  that people  had                                                                    
paid into the system. He urged support for the resolution.                                                                      
10:27:31 AM                                                                                                                   
Co-Chair Stedman  wanted to clarify  that the  testifier had                                                                    
paid into social security for 25 years.                                                                                         
Mr.  Guttenberg affirmed  he had  paid into  Social Security                                                                    
for 25 years.                                                                                                                   
Co-Chair  Stedman understood  that Mr.  Guttenbergs  penalty                                                                    
had been $500 per month.                                                                                                        
Mr. Guttenberg replied in the affirmative.                                                                                      
10:28:13 AM                                                                                                                   
Co-Chair Bishop CLOSED public testimony.                                                                                        
Senator   Hoffman  asked   whether  the   benefits  of   the                                                                    
legislation would  be applied  retroactively. He  thought it                                                                    
was known that the Social  Security fund was underfunded and                                                                    
wondered whether Congress would  address the solvency of the                                                                    
Senator  Wielechowski   responded  that   retroactivity  and                                                                    
enforcement would  be determined by Congress.  He hoped that                                                                    
the benefits  would be  retroactive. He  did not  think back                                                                    
payment.  He agreed  that Social  Security  solvency was  an                                                                    
issue he hoped would be addressed by Congress.                                                                                  
10:30:14 AM                                                                                                                   
Co-Chair Stedman  thought it would  be important to  have 30                                                                    
or  more  years  in  Social Security.  He  believed  it  was                                                                    
reasonable for people  to expect to be paid out  by the fund                                                                    
they had paid into during their working lives.                                                                                  
Co-Chair Bishop  set an amendment deadline  for 1pm, Monday,                                                                    
February 28, 2022.                                                                                                              
SJR  12  was  HEARD  and   HELD  in  committee  for  further                                                                    
Co-Chair Bishop discussed housekeeping.                                                                                         
10:31:18 AM                                                                                                                   
AT EASE                                                                                                                         
10:31:30 AM                                                                                                                   
10:31:42 AM                                                                                                                   
The meeting was adjourned at 10:31 a.m.                                                                                         

Document Name Date/Time Subjects
SJR 12 Sponsor Statement.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SSTA 5/4/2021 3:30:00 PM
SJR 12
SJR 12 GPO Explainer 2.8.21.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SJR 12
SJR 12 Letter of Support 2.9.22.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SJR 12
SJR 12 Letter of Support 5.5.21.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SJR 12
SJR 12 Presentation.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SJR 12
SJR 12 WEP GPO Key Points 2.9.22.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SJR 12
SJR 12 WEP Explainer 11.16.21.pdf HL&C 3/21/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SJR 12
SB 151 Sponsor Statement.pdf HL&C 4/13/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 151
SB 151 Supporting Document - 2021 Audit Summary.pdf HL&C 4/13/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 151
SB 151 Supporting Document - 2021 Complete Audit.pdf HL&C 4/13/2022 3:15:00 PM
SFIN 2/24/2022 9:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 151
SB 173 Sponsor Statement.pdf SFIN 2/24/2022 9:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 173
SB 173 Sectional Analaysis version I.pdf SFIN 2/24/2022 9:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 173
SB 173 Written Testimony Received as of 1.31.22.pdf SFIN 2/24/2022 9:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 173
SJR 12 Responses to SFIN Committee Questions.pdf SFIN 2/24/2022 9:00:00 AM
SJR 12