Legislature(1999 - 2000)
02/18/2000 09:03 AM Senate FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
February 18, 2000
9:03 AM
TAPES
SFC-00 # 32, Side A
CALL TO ORDER
Co-Chair Sean Parnell convened the meeting at approximately
9:03 AM.
PRESENT Co-Chair John Torgerson, Co-Chair Sean Parnell,
Senator Al Adams, Senator Loren Leman, Senator Randy
Phillips, Senator Gary Wilken, Senator Green and Senator P.
Kelly.
Also Attending: DAVID TEAL, Director, Division of
Legislative Finance
SUMMARY INFORMATION
SB 217-APPROPRIATIONS: OPERATING BUDGET
The Committee heard on overview of the "language section"
by the Division of Legislative Finance. The bill was held
in Committee.
SENATE BILL NO. 217
"An Act making and amending appropriations for the
operating and loan program expenses of state
government, for certain programs, and to capitalize
funds; making appropriations under art. IX, sec.
17(c), Constitution of the State of Alaska, from the
constitutional budget reserve fund; and providing for
an effective date."
Co-Chair Parnell noted that only the "Language Section"
would be addressed at this meeting. This is the part of the
budget bill formally known as the "Front Section." The
previous "Back Section" will now be referred to as the
"Numbers Section." In SB 217, the language section begins
on page 39 with Section 3.
DAVID TEAL, Director, Division of Legislative Finance gave
a section by section overview of the language section as
follows. He noted that SB 190, the legislation containing
the governor's proposed budget, contains several sections
that are not included in this bill.
Section 3 Alaska Housing Finance Corporation
This section contains the same language as in the
previous year.
Mr. Teal stated that the Division of Legislative Finance
recommends the language be replaced with the Governor's
proposed language, which is clearer. The Governor's
language specifies that:
(a) $103 million is available as a dividend to the
State,
(b) describes how the dividend is to be appropriated,
(c) sends any remaining money to the debt retirement
fund (replacing sections (a) and (d)),
(d) appropriates corporate receipts for AHFC
operations (same as (b)), and
(e) appropriates money for loan programs.
Mr. Teal qualified that housing assistance payments are $25
million in the Governor's bill rather than the $16 million
approved last year. He suggested this matter could be
addressed in the budget subcommittee.
Section 4 Permanent Fund Corporation
This is standard language describing disposition of
Permanent Fund earnings and settlements. No amounts
are listed in this language, only specification of
where the money is going.
Section 5 Science and Technology Foundation
This is standard language allowing carry forward of
earnings on the endowment.
Section 6 Alaska Seafood Marketing Institute
This is standard language allowing ASMI to carry
forward receipts collected in FY00 from the salmon
marketing tax and seafood marketing assessment.
Section 7 Child Support Enforcement
This section makes sure that the Child Support
Enforcement Division (DCED) has sufficient state match
to obtain all available federal money.
Mr. Teal pointed out that the language differs slightly
from the Governor's, but appears to have the same effect.
Section 8 Constitutional Budget Reserve
Subsection (a) contains standard language that
reverses the sweep from the general fund into the
Constitutional Budget Reserve.
Mr. Teal noted the Governor added a section in SB 190 that
states that the draw from the Constitutional Budget Reserve
is equal to whatever is needed to fill the fiscal gap. As
written, section 8 of SB 217 allows no draw at all, he
stressed. He explained that the fixed limit provision was
removed from the draft.
Section 9 Disaster Relief
This is standard language appropriating federal
receipts for disasters.
Section 10 Federal and Other Program Receipts
This contains standard language allowing the
Legislative Budget and Audit Committee to address
certain additional receipts.
Mr. Teal stressed that this is restrictive language that
allows only a limited type of program receipts. He noted
that the governor's proposed language would allow RPLs to
address all funds, including general funds.
Mr. Teal told the Committee about Section 9 in the
governor's proposed budget dealing with federal subsistence
funds. The section is divided into two subsections
described as follows:
Subsection (a) is not an appropriation, it merely
states that $11 million of federal money is being used
for subsistence management.
Subsection (b) appropriates $3 million in federal
receipts to the Department of Fish and Game for
contracts with the federal government and to support
coordination.
Mr. Teal stated that the Division of Legislative Finance
recommends that the $3 million in federal receipts be
placed in the numbers section of the bill. However, he
noted to do that, specific components and line items
directing the use of the funds, should be identified. He
suggested the Fish and Game Budget Subcommittee address the
matter.
Section 11 Fish and Game Enforcement
This is standard language allowing the Department of
Public Safety to spend the criminal fines and
penalties portion of the Fish and Game Fund.
Mr. Teal pointed out that the governor has added a section
in his bill that puts crew license fees, shooting range
fees and boating access fees into the Fish and Game Fund.
Mr. Teal suggested the subcommittee could also address this
issue. However, he noted that the Division of Legislative
Finance saw no reason why this should not be done.
Section 12 Four Dam Pool
This is standard language that describes the split of
funds from the Four Dam Pool Transfer Fund. It
continues the 60/40 split to the Power Cost
Equalization program and the Southeast Energy Fund.
Section 13 Information Services Fund
This is standard language allowing the Information
Technology Group to retain designated program
receipts.
Mr. Teal shared the Division of Legislative Finance
recommendation that this appropriation be moved to the
numbers section of the bill.
Section 14 Insurance and Bond Claims
This is standard language allowing the Department of
Administration to use the insurance catastrophic
reserve account to cover bond claims.
Section 15 Insurance Fees
This section allows DCED to carry forward insurance
fees and other program receipts.
Mr. Teal pointed out that this section contains "not to
exceed" language that was first used last year, but that
the amount appears wrong as it is far less than the amount
appropriated in the numbers section of the bill. He shared
the Division of Legislative Finance suggestion of using
language similar to that in Section 33 of this bill.
Section 33 states that the receipts are included in the
amount appropriated in section 1. He surmised this would be
less confusing and the amounts won't need to be listed in
the language section at all.
Senator Adams wanted to know if by stating a dollar amount,
the language stipulates that the department can spend "up
to" that amount. Mr. Teal clarified that, "the amount that
is allowed to be carried forward is included in the number
listed in Section 1." He said this language makes it clear
that the stated amount is all the department is allowed to
spend.
Section 16 Marine Highway System Fund
This is standard language that puts approximately $27
million from the general fund into the Alaska Marine
Highway Operating Fund.
Mr. Teal noted that the Division of Legislative Finance
recommends that this appropriation be moved to the numbers
section of the bill.
Section 17 Medicaid School Based Claim
This is standard language stating that shortfalls in
federal funding will be replaced with general funds.
Mr. Teal noted that there is no limit on the amount of
shortfalls that would be made up.
Section 18 Motor Fuel Tax
This is standard language splitting fuel taxes into
highway and aviation accounts.
Mr. Teal qualified that the governor's language lists the
amounts as $25,338,300 to highways and $5,600,000 to
aviation, rather than the $23,924,500 and $5,400,000
respectively listed in SB 217. He suggested this is another
item that subcommittees may wish to address.
Co-Chair Parnell asked if the difference is due to increase
collection or if it is based on a higher tax. Mr. Teal
answered increased collection.
Section 19 Occupational Licensing
This section allows DCED to carry forward fees and
other program receipts.
Mr. Teal cautioned that the section contains "not to
exceed" language first used last year, but that the amount
appears wrong as it is far less than the amount
appropriated in the numbers section of the bill. He said
the Division of Legislative Finance suggests that language
similar to that in section 33 would be less confusing. That
language says the receipts are included in the amount
appropriated in section 1 of the bill.
Mr. Teal also noted that DCED is requesting $450.0 in the
supplemental bill, presumably because the limit was too
restrictive. Again, he told the Committee that the Division
of Legislative Finance suggests subcommittee review.
Section 20 011 and Hazardous Substance Release
Prevention Account
This is standard language capitalizing the account.
Mr. Teal shared that the Governor's request was for
$9,800,000 rather than the $10,900,000 stated in the bill.
Section 21 Oil and Hazardous Substance Release
Response Account
This is standard language capitalizing the account.
Section 22 Regulatory Commission of Alaska (RCA)
This is standard language allowing the RCA (formerly
Alaska Public Utilities Commission) to carry forward
receipts.
Section 23 Retained Fees
This is standard language allowing the collector of
fees, licenses and taxes to retain a portion of the
receipts.
Section 24 Safety Advisory Council
This is standard language allowing carry forward of
receipts from the prior year.
Mr. Teal pointed out an incorrect statutory reference in
this section that should be to sec. 23, ch.84, SLA 1999
rather to the 1998 operating bill.
Mr. Teal conveyed Division of Legislative Finance's
suggestion that language similar to that in Section 33 of
the bill would clarify that the carry forward does not
increase the amount appropriated in Section 1 of the bill.
Section 25 Salary and Benefit Adjustments
This section specifies that funding for salary
increases at the University are included in the amount
appropriated in Section 1.
Mr. Teal said that the language differs slightly from that
proposed by the Governor, but the effect appears to be
identical. He then noted that "University of" should be
added to the description of "Alaska Classified Employees
Association."
Section 26 Salmon Enhancement Tax
This is standard language allowing a pass-through of
salmon taxes to regional associations.
Section 27 Shared Taxes and Fees
This is standard language allowing local governments
to obtain their share of listed taxes and fees.
Mr. Teal told the Committee that the Governor's bill
included a section that treats block grants in the same
manner as Medicaid School Based Claims. Mr. Teal explained
that a shortfall in federal receipts would be replaced with
general funds. He added that the section places a cap of
$4,474,500 on general funds for this purpose. Division of
Legislative Finance recommends subcommittee review of this
issue, according to Mr. Teal.
Section 28 State Debt and other Obligations
This language was taken from the Governor's bill and
updates last year's amounts.
Mr. Teal noted that the language contains no reference to
General Obligation Bonds because the last of that debt was
paid off in FY00. A new subsection should be added if new
General Obligation Bonds are issued, he advised.
Senator Adams asked if the witness would suggest "boiler
plate" language since the legislature is considering
issuing new General Obligation Bonds. Mr. Teal responded
that, because bonds are issued almost every year, "it can't
hurt and it may help."
Subsection (i) fixes a technical error in last year's
bill.
Section 29 State Training and Employment Program
This is standard language allowing carry forward of
the STEP account balance.
Governor's Section 31 Primary and General Election
Mr. Teal pointed out in the governor's legislation, a
section included that identifies election costs as one-time
items. Mr. Teal said the Division of Legislative Finance
recommends that this and similar one-time items be placed
in the language section as a matter of policy. Doing so
would highlight the one-time items, thus ensuring that they
are backed out when appropriate instead of becoming lost in
the numbers section of the bill, according to Mr. Teal.
Section 30 Statutory Budget Reserve Fund
This is standard language allowing budget shortfalls
to be covered by withdrawals from the reserve account
Mr. Teal noted that the account has no balance.
Section 31 Storage Tank Assistance Fund
This is standard language capitalizing the fund.
Mr. Teal qualified that the governor's bill requested
$1,090,612 rather than the $5,239,700 specified in SB 217.
Section 32 Student Loan Program
This is standard language allowing origination fees to
be used to offset losses due to death, disability,
default or bankruptcy.
Section 33 Teacher Certification
This is standard language allowing carry forward of
receipts.
Section 34 Test Fishery Receipts
This is standard language allowing carry forward of
receipts.
Mr. Teal pointed out that there is no limit on the amount
of carry forward.
Section 35 and
Section 36
These sections are standard non-lapse and effective
date provisions.
Senator Adams asked if there was any other language the
Committee should consider that is not present in this bill.
Mr. Teal responded there was not.
ADJOURNED
Senator Parnell adjourned the meeting at approximately 9:20
AM.
SFC-00 (1) 02/18/00
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