Legislature(2015 - 2016)SENATE FINANCE 532
04/01/2015 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB72 || HB73 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 72 | TELECONFERENCED | |
| += | HB 73 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
April 1, 2015
9:40 a.m.
9:40:12 AM
CALL TO ORDER
Co-Chair Kelly called the Senate Finance Committee meeting
to order at 9:40 a.m.
MEMBERS PRESENT
Senator Anna MacKinnon, Co-Chair
Senator Pete Kelly, Co-Chair
Senator Peter Micciche, Vice-Chair
Senator Click Bishop
Senator Mike Dunleavy
Senator Lyman Hoffman
Senator Donny Olson
MEMBERS ABSENT
None
ALSO PRESENT
James Armstrong, Staff, Senator Pete Kelly; David Teal,
Director, Legislative Finance Division.
SUMMARY
CSHB 72(FIN)
APPROP: OPERATING BUDGET/LOANS/FUNDS
CSHB 72(FIN) was HEARD and HELD in committee for
further consideration.
CSHB 73(FIN)
APPROP: MENTAL HEALTH BUDGET
CSHB 73(FIN) was HEARD and HELD in committee for
further consideration.
CS FOR HOUSE BILL NO. 72(FIN)
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs and capitalizing funds; and providing
for an effective date."
CS FOR HOUSE BILL NO. 73(FIN)
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
9:40:27 AM
Co-Chair Kelly stated that the committee would be going
through six amendments.
Co-Chair MacKinnon MOVED to ADOPT Amendment 1 (copy on
file):
DEPARTMENT: Education and Early Development
APPROPRIATION: Teaching and Learning Support
ALLOCATION: Unallocated Appropriation
DELETE: $320,000 UGF (1004)
DEPARTMENT: Education and Early Development
APPROPRIATION: Teaching and Learning Support
ALLOCATION: Early Learning Coordination
DELETE: $320,000 UGF (1004)
EXPLANATION: This net zero amendment removes an
unallocated appropriation of $320.0 UGF and restores
$32.0 UGF to the Best Beginnings program.
Co-Chair Kelly OBJECTED for discussion.
9:41:23 AM
JAMES ARMSTRONG, STAFF, SENATOR PETE KELLY, explained
Amendment 1, stating that it was a net-zero Unrestricted
General Fund (UGF) amendment which deleted an unallocated
appropriation within the Department of Education and Early
Development (DEED) Division of Teaching and Learning
Support and placed the $320,000 into the Best Beginnings
program within the same division.
Senator Dunleavy added that the funds were moved to the
Best Beginnings program with the idea that the money would
be used for books for those communities that would have
difficulty accessing books for young children.
Co-Chair Kelly WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment 1 was ADOPTED.
9:42:11 AM
Co-Chair MacKinnon MOVED to ADOPT Amendment 2, (copy on
file):
DEPARTMENT: Legislature
APPROPRIATION: Legislative Council
ALLOCATION: Council and Subcommittees
ADD: $64,800 Unrestricted General Funds (1004)
EXPLANATION: This amendment adds $64,800 Unrestricted
General Funds to be split evenly between the House
Special Committee on Economic Development, Tourism,
and Arctic Policy and the Senate Special Committee on
the Arctic.
Co-Chair Kelly OBJECTED for discussion.
Mr. Armstrong discussed Amendment 2, explaining that in the
previous fiscal year there had been funds appropriated for
Arctic policy work - $65,000 of which was going to lapse.
There had been a request to reappropriate the funds, but it
was thought to be cleaner to let the funds lapse and
reappropriate the same amount to be split evenly between
the House and Senate committees that worked on Arctic
policy for FY 16.
9:42:56 AM
Co-Chair MacKinnon disclosed that her husband served on the
board for Arctic Power. The funds being discussed were not
related to the company, but she wanted to avoid any
confusion.
9:43:32 AM
AT EASE
9:45:02 AM
RECONVENED
Co-Chair Kelly WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment 2 was ADOPTED.
9:45:17 AM
Senator Hoffman MOVED to ADOPT Amendment 3 (copy on file):
DEPARTMENT: Commerce, Community, and Economic
Development
APPROPRIATION: Tourism Marketing & Development
ALLOCATION: Tourism Marketing
ADD: $1,500,000 Statutory Designated Program Receipt
(1108)
ADD: Language Section: An amount not to exceed
$1,500,000 is appropriated from the general fund to
the Department of Commerce, Community and Economic
Development, Tourism Marketing and Development to
match each dollar in excess of the $2,700,000
appropriated in section 1 of this act as contributions
from the tourism industry.
EXPLANATION: The Tourism Marketing budget currently
includes $2.7 million of Statutory Designated Program
Receipt (SDPR) authority for receipts collected from
the tourism industry. This amendment adds $1.5 million
SDPR authority for a total of $4.2 million. The
language portion of this amendment will match up to
$1.5 million of the newly authorized SDPR with UGF.
Co-Chair Kelly OBJECTED for discussion.
Mr. Armstrong explained Amendment 3, stating that in the
Senate Finance Subcommittee on Department of Commerce,
Community and Economic Development (DCCED) $3 million had
been removed from the numbers section. He recounted that
the subcommittee budget narrative requested the full
committee to amend the language section to appropriate
statutorily designated program receipt (SDPR) authority of
up to $1.5 million for the Alaska Tourism Marketing Board,
which would be matched with UGF. He added that if the board
was able to gather more SDPR, there was a one-to-one match
of UGF, with a ceiling of $1.5 million.
Co-Chair Kelly WITHDREW his OBJECTION.
Senator Hoffman explained that the amendment would
primarily increase the board's SDPR from $2.7 million to
$4.2 million, and would give the board the incentive to
raise the funds to promote tourism in the state.
There being NO further OBJECTION, Amendment 3 was ADOPTED.
9:46:40 AM
Co-Chair Kelly MOVED to ADOPT Amendment 4, 29-GH1780\S.4,
Wallace, 3/30/15 (copy on file):
Page 79, line 15:
Delete all material.
Page 79, following line 24:
Insert a new subsection to read:
"(c) The amount necessary, estimated to be $200,000,
to refund to local governments their share of an
aviation fuel tax or surcharge under AS 43 .40 for the
fiscal year ending June 30, 2016, is appropriated from
the proceeds of the aviation fuel tax or surcharge
levied under AS 43 .40 to the Department of Revenue
for that purpose."
Explanation
As a condition of various federal grants, the FAA
requires aviation fuel tax proceeds to be spent for
capital or operating costs of airports. That makes
aviation tax proceeds a dedicated revenue source. The
shared taxes section (section 28) formerly
appropriated aviation fuel tax refunds from the
general fund. Section c clarifies that the proceeds
shared with local governments are not unrestricted
general funds; they come from the dedicated aviation
taxes levied in AS 43.40. The statutory reference is
broad in order to include any surcharges that may be
levied under AS 43.40. Shared taxes are excluded from
budget reports prepared by the Legislative Finance
Division, so this amendment will have no visible
impact on spending.
Co-Chair MacKinnon OBJECTED for discussion.
Mr. Armstrong discussed Amendment 4, stating that it was a
technical amendment initiated from concerns brought to the
state by the Federal Aviation Administration (FAA). The FAA
had communicated that the state was not specifying clearly
enough in the operating budget where certain aviation taxes
were being distributed. Federal guidelines were considered
by Legislative Finance Division (LFD) Director David Teal
and the Division of Legal and Research Services in order to
construct the amendment.
Senator Olson mentioned airport budgets and asked about the
specific areas of non-compliance being addressed in the
amendment.
9:47:52 AM
AT EASE
9:48:43 AM
RECONVENED
Senator Olson thought that the amendment addressed capital
and operating budgets of airports in the state. He
discussed airport maintenance and personnel and wondered
what considerations were being addressed in the amendment.
DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION,
explained that the amendment was not specific to airport
operations, and the federal government simply wanted to
ensure that the proceeds from aviation fuel taxes were
spent on airports. He referred to the three classifications
the FAA used for airports and tracking funding:
international, state, and municipal. He continued that the
state had traditionally spent far more general funds (GF)
on airport facilities and operations than was collected
from the aviation tax, and the federal government needed an
accounting of how the funds were spent. Federal
requirements only specified that the funds were spent on
airports, and the state needed to change the manner in
which it appropriated in order to demonstrate how the money
was spent.
Co-Chair Kelly WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment 4 was ADOPTED.
9:51:14 AM
Co-Chair Kelly MOVED to ADOPT Amendment 5 (copy on file):
DEPARTMENT: Natural Resources
APPROPRIATION: Administration & Support Services
ALLOCATION: North Slope Gas Commercialization
DELETE: $11,311.1 Unrestricted General Fund (1004)
ADD: $8,986.7 Unrestricted General Fund (1004) as One-
Time Item
EXPLANATION:
This amendment removes additional funding for North
Slope Gas Commercialization requested by the governor
and reduces the total to match the fiscal note to SB
138. It converts the remaining $8,986.7 to a one-time
item.
Vice-Chair Micciche OBJECTED.
Mr. Armstrong explained Amendment 5, and referred to SB 138
[oil and gas legislation passed the previous session]; in
which there was a one-time funding item of $8,986,700 for
Department of Natural Resources' (DNR) efforts towards the
commercialization of North Slope gas. He continued that the
administration had added an additional budget increment of
$4.2 million for the efforts, and the finance subcommittee
on DNR had subsequently reduced the amount by $1.9 million.
The amendment further reduced the increment and provided FY
15 funding and re-designated the commercialization efforts
as a one-time item.
Co-Chair Kelly continued that the issue had come to the
committee's attention after the funds had changed from one-
time funding to a base allocation that was then increased.
The amendment would take the amount back to the original
$8.9 million of GF as specified in SB 138. He added that
the item would be additionally discussed in conference
committee before the end of session.
Vice-Chair Micciche WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment 5 was ADOPTED.
9:53:05 AM
Co-Chair Kelly MOVED to ADOPT Amendment 6 (copy on file):
Department: Environmental Conservation
Appropriation: Spill Prevention and Response
Allocation: Spill Prevention and Response
Delete: $100.0 Oil/Haz Fd (1052)
Explanation: The ongoing reorganization in SPAR will
result in additional efficiencies in FY2016 and reduce
personal services expenditures.
Department: Environmental Conservation
Appropriation: Administration
Allocation: Administrative Services
Delete: $50.0 Oil/Haz Fd (1052)
Explanation: The Division of Administrative Services
provides centralized administrative support services
to the department programs and is intentionally funded
in direct proportion to the funding source breakdown
of the Personal Services costs in the Department. This
method complies with an approved federal indirect cost
allocation plan. The division will take a coordinating
reduction to personal services expenditures.
Vice-Chair Micciche OBJECTED.
Mr. Armstrong explained Amendment 6, stating that the
Department of Environmental Conservation's Spill Prevention
and Response Fund (SPAR) had a shortage of its normal oil
and hazardous gas funding and needed an additional $800,000
in the supplemental request. The department was holding a
22 percent vacancy factor in anticipation of not receiving
the funds. He furthered that there was pending legislation
dealing with the SPAR issuein both bodies. The amendment
would remove $150,000 of excess authority for the following
year, in case SPAR did not fill all of its vacant
positions; the legislation could fix the problem if passed
or this issue would be addressed the following year.
Vice-Chair Micciche WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment 6 was ADOPTED.
9:54:03 AM
AT EASE
9:55:32 AM
RECONVENED
Co-Chair Kelly MOVED to ADOPT Amendment 7A, 29-GH1780\S.1,
Wallace, 3/30/15 (copy on file).
Co-Chair MacKinnon OBJECTED.
Mr. Armstrong discussed Amendment 7A and 7B, and referred
to Amendment 7A, Page 1, lines 4 through 7:
The monetary terms for the fiscal year ending June 30,
2016, of each of the collective 5 bargaining
agreements listed in this section are rejected under
AS 23.40.215 unless separate legislation is enacted
that contains explicit language approving the monetary
terms of that agreement. Money appropriated in sec. 1
of this Act may not be used to implement the
Mr. Armstrong explained that Amendment 7A rejected the
monetary terms of the contracts solicited by the bargaining
organizations listed in HB 72 and HB 73 for the fiscal year
starting July 1, 2015.
Mr. Teal noted that there was backup available that might
be helpful for the committee, including a summary that
listed agency impacts sorted by fund code. He shared that
after the action was taken, the materials would be posted
online.
Co-Chair Kelly asserted that the legislature must ratify
and approve state contracts, and if there was specific
language in the budget not to fund the contracts, the
agencies would be required not to fund the raises in the
contracts. He continued that the amendment would not help
toward the budget cutting goal; however it would allow the
state to not spend the $30 million in GF required to accept
and fund the 2.5 percent negotiated salary increase. He
concluded that the total funds that would be saved were
approximately $50 million.
9:57:56 AM
Mr. Armstrong related that the committee had worked with
LFD to run reports with up to date information. He
specified that if Amendment 7A was adopted, total funding
reduction would equal $54,705,100.
Co-Chair Kelly asked if there was a total funding reduction
amount in GF. Mr. Armstrong stated that the total reduction
was broken down as follows: $28,807,000 in UGF; $12,793,000
in designated general funds (DGF); $8,327,000 in other
state funds; and $4,776,000 in federal receipts.
Co-Chair Kelly anticipated that the amendment would save
the state from about 300 layoffs in the future. He
qualified that there were no guarantees, as state managers
would make the ultimate choices, but the amendment would
allow state agencies to pay their current employees rather
than fund raises. He proposed that the amendment was an
action to save jobs, and would also save money.
9:59:22 AM
Vice-Chair Micciche surmised that Amendment 7A was
essentially denying the final year of the contract
increase. He was concerned that the action could be
misconstrued as more extreme than he felt it was.
Co-Chair Kelly clarified that state employee contracts were
staggered over time and the amendment would deny 2016
contracts.
9:59:51 AM
AT EASE
10:36:48 AM
RECONVENED
Co-Chair Kelly asked Mr. Teal to discuss Amendments 7A and
7B [corresponding amendment to HB 73].
Mr. Teal discussed Amendment 7A, which removed the monetary
terms approval from both the operating budget and the
mental health budget. He stated that if the terms were
rejected, it would (in theory) send the bargaining units
back to the table to renegotiate.
Mr. Teal continued that Amendment 7B was the mechanism that
actually removed the money from the budget, and reversed
all the salary adjustments associated with the contracts as
well as all the money associated with raises for non-
covered employees. He referred to the back-up documents
attached to Amendment 7B, which indicated the amounts of
money affected by fund code as well as a summary sheet that
indicated the amount of money by agency. He reiterated that
information on individual transactions would be posted on
the web. He suggested that the only question might be why
only the bargaining units were addressed in Amendment 7A,
when Amendment 7B removed money for both the covered units
and non-covered employees.
Co-Chair Kelly stated that he anticipated forthcoming
legislation to address the concern.
Senator Olson asked how the amendments would affect
salaries of non-covered employees, such as executive branch
and legislative branch employees.
Mr. Armstrong confirmed that Amendment 7B addressed non-
covered employees, and noted that separate legislation to
repeal the 2016 increases would need to be introduced and
passed during the current legislative session.
Co-Chair Kelly explained that such legislation would have a
zero fiscal note if the amendments passed.
10:39:49 AM
Mr. Teal concurred that there would be a zero fiscal note
on the bill. He clarified that because of some of the
recently passed amendments that removed money from the
budget (such as Amendment 5 dealing with gas
commercialization), the salary adjustments being considered
would apply to the budget as it came in. He summarized that
it was possible that the committee was removing money
(through the salary adjustment transactions) where no money
existed. He stated that the situation could not be fixed
until the legislature was near the end of the budget
process, and it should be covered by the typical motion of
conforming and technical adjustments that LFD and
legislative legal could make.
Co-Chair Kelly asked for edification as to whether
technical clarifications needed to be made on Amendment 7B.
Mr. Teal stated that the adjustments would be made as the
bill was drafted. He furthered that if an allocation or
fund code went negative in an allocation, LFD (with the
legislature's approval) had the ability to not reduce a
salary where there was no money or position filled. He
suggested that if changes to the aforementioned amendment
backup were needed, they would be relatively small.
Vice-Chair Micciche asked if Amendment 7A allowed the
administration and state workers to open the discussion
about funding salary contracts, whereas Amendment 7B was
not focused on collective bargaining employees alone. He
asked if the amendments mechanically provided a wage freeze
for FY 16.
Co-Chair Kelly stated that the allocations represented a
wage freeze, and the language portion of the amendments was
specifically for the contracts.
10:42:37 AM
Mr. Teal clarified that the amendment language only
referred to collective bargaining agreements, as that was
all that could be done in the operating bill. He continued
that the fund reductions were for both covered and non-
covered employees. He specified that the salary schedule
could not be changed in the operating bill, and there was
no agreement for the non-covered employees, which would
require separate legislation.
Co-Chair Kelly surmised that the language section denied
the contracts, and the allocations made the reduction for
both employee groups.
Mr. Teal responded in the affirmative. He furthered that
the amendments would leave all salaries (covered and non-
covered) at the FY 15 levels.
Co-Chair MacKinnon WITHDREW her OBJECTION to Amendment 7A.
There being NO further OBJECTION, Amendment 7A was ADOPTED.
Co-Chair MacKinnon MOVED to ADOPT Amendment 7B, 29-
GH1782\N.1, Wallace, 3/30/15 (copy on file).
There being NO OBJECTION, it was so ordered.
Co-Chair Kelly indicated that the meeting would be recessed
until 1:30 p.m.
10:45:38 AM
RECESSED
3:32:29 PM
RECONVENED
Co-Chair MacKinnon MOVED to ADOPT Amendment 8 (copy on
file):
DEPARTMENT: University of Alaska
APPROPRIATION: University of Alaska
ALLOCATION: Budget Reductions/ Additions - System wide
DELETE: $1,800.0 Unrestricted General Fund (1004)
EXPLANATION: This amendment reduces the Senate
Subcommittee addition of $5 million UGF to the
University of Alaska by ($1.8 million UGF).
DEPARTMENT: Education and Early Development
APPROPRIATION: Alaska Library and Museums
ALLOCATION: Library Operations
ADD: $1,800,000 Higher Education Investment Fund
(1226)
$1,800,000 Unrestricted General Funds (1004)
EXPLANATION: Currently there are 122 rural schools
funded through the broadband program, bringing these
schools up to the minimum of 1 OMB. This is a
tremendous opportunity for the State to leverage its
investment at a 5:1 ratio on a statewide basis,
meaning this $3.6 million can leverage an additional
$14.4 million in federal funding.
Broadband access is critical to the delivery of
distance courses for students and teachers in rural
areas to improve the quality of education and increase
graduation rates.
This amendment uses money from the Alaska Higher
Investment Fund as this purpose is consistent with the
goals of the fund.
Co-Chair Kelly explained that the amendment moved $1.8
million from the University of Alaska system wide, and
placed the funds in the Alaska Library and Museums to fund
the broadband program.
3:33:33 PM
Mr. Armstrong discussed Amendment 8, noting that it was a
reduction of $1.8 million in GF and also captured $1.8
million from the Alaska Higher Education Investment Fund
for a total of $3.6 million.
There being NO OBJECTION, Amendment 8 was ADOPTED.
3:34:09 PM
Vice-Chair Micciche MOVED to ADOPT Amendment 9, 29-
GHI780\S.7, Wallace, 4/1/15 (copy on file).
Page 5, lines 4 - 5:
Delete all material and insert:
APPROPRIATION GENERAL OTHER
ALLOCATIONS ITEMS FUND FUNDS
Public Communications Services
2,596,100 2,496,100 100,000
Public Broadcasting Commission
46,700
Public Broadcasting - Radio
1,336,600
Public Broadcasting - T.V.
333,300
Satellite Infrastructure 879,500
Adjust fund sources and totals accordingly.
Explanation: This amendment will restore $1,336,000 to
Public Broadcasting Radio and $333,300 to Public
Broadcasting TV and $879,500 to Satellite
Infrastructure. In discussions with the Department of
Administration, this is the recommended level where
urban areas would absorb the full reductions while
there would be no further reductions to the rural
stations which would remain at their full funding
level submitted by the Governor.
The restoration of the full $879,500 for Satellite
Infrastructure will enable those services such as
ARCS, emergency broadcasting and transponder
availability for the University to continue without a
funding reduction.
Co-Chair Kelly OBJECTED for discussion.
Mr. Armstrong discussed the funding being restored to
public broadcasting in Amendment 9.
Co-Chair Kelly asked Mr. Armstrong to read the explanation
at the bottom of Amendment 9.
Senator Bishop noted that his name was inadvertently
omitted and he was also a sponsor of Amendment 9.
Co-Chair Kelly WITHDREW his OBJECTION.
There being NO OBJECTION, Amendment 9 was ADOPTED.
3:36:35 PM
AT EASE
3:37:06 PM
RECONVENED
Senator Olson WITHDREW Amendment 10.
Senator Olson MOVED to ADOPT Amendment 11 (copy on file):
DEPARTMENT: Administration
APPROPRIATION: Legal and Advocacy Services
ALLOCATION: Public Defender Agency
ADD: $1,220,300 general funds (1004)
EXPLANATION: Restore the Public Defender's Agency so
it reflects the House version.
Co-Chair Kelly OBJECTED.
3:37:36 PM
Senator Olson explained that Amendment 11 would restore
$1.22 million into the Public Defender Agency. He commented
that many individuals in his district were dependent upon
the Public Defender Agency. He furthered that the agency
was increasingly functioning with less resources. He
commented that a cut of $1.22 million would signify
attorney caseloads which exceeded many recommendations as
well as guidelines of the American Bar Association. Senator
Olson suggested that as caseloads increased, attorneys
would not be able to serve clients as effectively and it
would result in increased risk of innocent people being
convicted at trial. He thought that a cut would increase
overall case costs through pre-trial delay, periods of pre-
trial incarceration, inmate transport costs, and conflicts
of interest. Additionally, he thought that it would
increase costs for the Department of Labor and Workforce
Development, the Department of Public Safety, and the
Department of Corrections.
Senator Olson asserted that any changes that the Department
of Law implemented to reduce workloads across the state
would not be realized by the agency in FY 16. He thought
there would be a delay in realizing benefits due to the
time necessary to process new and existing cases under
reforms. He opined that any projected impact on agency
workloads was speculative, and reminded the committee that
it was constitutionally mandated that individuals have
access to a lawyer in criminal cases and appeals.
3:39:45 PM
A roll call vote was taken on the motion.
OPPOSED: MacKinnon, Bishop, Dunleavy, Hoffman, Micciche,
Kelly
IN FAVOR: Olson
The MOTION to adopt Amendment 11 FAILED (6/1).
3:41:00 PM [messed up]
Senator Olson moved to MOVED to ADOPT Amendment 12 (copy on
file):
DEPARTMENT: Administration
APPROPRIATION: Legal and Advocacy Services
ALLOCATION: Office of Public Advocacy
ADD: $425,100 general funds (1004)
EXPLANATION: Restore the Office of Public Advocacy so
it reflects the House version.
Co-Chair Kelly OBJECTED.
Senator Olson explained that most of the work in the Office
of Public Advocacy (OPA) was mandated by the Alaska State
Constitution. He continued that OPA was a downstream agency
that dealt primarily with civil lawsuits and had no control
over the cases which were assigned to it. He recounted that
the OPA public guardians had the highest caseloads in the
country, and were tasked with making major life decisions
for adult wards of the state. He continued that current
public guardian caseloads were 2 to 3 times the nationally
recommended maximum, equating to each ward receiving
approximately 1.5 hours per month of public guardian time.
He considered the current caseload to pose a threat to the
health and safety of some of the state's most vulnerable
citizens.
Senator Olson discussed OPA's guardians ad litum, who
represented abused and neglected children across the state
and had individual staff caseloads exceeding 100 children.
He compared the caseload to that of Colorado, which had a
maximum of 30 children per guardian. Caseloads had
increased by approximately 40 percent for FY 15, and the
attorney general's office predicted a continuation by
filings through the Office of Children's Services.
Senator Olson discussed OPA's programs for elder fraud and
court advocates for victims of abuse, and noted that they
would possibly be eliminated if they did not receive
funding as they were not required by law.
Co-Chair Kelly MAINTAINED his OBJECTION.
3:42:53 PM
AT EASE
3:43:46 PM
RECONVENED
A roll call vote was taken on the motion.
OPPOSED: Kelly, Bishop, Dunleavy, Hoffman, Micciche,
MacKinnon
IN FAVOR: Olson
The MOTION to adopt Amendment 12 FAILED (6/1).
3:44:47 PM
Senator Olson WITHDREW Amendment 13.
Senator Olson MOVED to ADOPT Amendment 14 (copy on file):
DEPARTMENT: Education and Early Development
APPROPRIATION: Teaching and Learning Support
ALLOCATION: Pre-Kindergarten Grants
ADD: $1,900,000 general funds (1004)
EXPLANATION: This restores Pre-Kindergarten grants to
the level proposed by the Governor's Amended budget
request.
Co-Chair MacKinnon OBJECTED for discussion.
Senator Olson explained Amendment 14, which would add $1.9
million in GF into DEED with the intent of restoring the
pre-K grants to the level proposed by the governor's
amended budget request. He alleged that early childhood
education would help children keep up and necessitate less
remediation in future schooling, as well as help create
future leaders who would help advance the success of the
state.
Co-Chair Kelly MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
OPPOSED: Micciche, MacKinnon, Bishop, Dunleavy, Hoffman,
Kelly
IN FAVOR: Olson
The MOTION to adopt Amendment 14 FAILED (6/1).
3:46:33 PM
Senator Olson moved to adopt Amendment 15 (copy on file):
DEPARTMENT: Education and Early Development
APPROPRIATION: Teaching and Learning Support
ALLOCATION: Early Learning Coordination
ADD: $557,500 general funds (1004) Best Beginnings
$287,500 general funds (1004) Parents as Teachers
EXPLANATION: This restores Best Beginnings and Parents
as Teachers to the level proposed in the Governor's
Amended budget request.
Co-Chair Kelly OBJECTED for discussion.
Senator Olson spoke to Amendment 15, explaining that the
amendment would restore funds in the Division of Teaching
and Learning Support. He discussed past effectiveness of
the programs and mentioned the provision of books to young
children in rural Alaska.
Senator Dunleavy commented that there had been an earlier
amendment that restored partial funding to the Best
Beginnings program. He considered that the focus of the
funding should be on rural communities where there were
young children without access to libraries.
Co-Chair Kelly MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
OPPOSED: Hoffman, Micciche, Kelly, Bishop, Dunleavy,
MacKinnon
IN FAVOR: Olson
The MOTION to adopt Amendment 15 FAILED (6/1).
3:48:20 PM
Senator Olson MOVED to ADOPT Amendment 16 (copy on file):
DEPARTMENT: Transportation & Public Facilities
APPROPRIATION: Alaska Marine Highway System
ALLOCATION: Marine Vessel Operations
ADD: $1.75 million Unrestricted General Funds (1004)
Explanation: This amendment restores $1.75 million GF
to the Alaska Marine Highway System, whose users pay
almost 1/3 the cost of operations.
Far from the governor's request level, this restores
only the AMHS service levels to those in the House
cut. Without these funds, the system will need to
rebook or cancel 8000 passengers and 2000 vehicles
whose fares are already in hand.
Co-Chair MacKinnon OBJECTED for discussion.
Senator Olson read Amendment 16 and asked for the support
of the committee.
Co-Chair MacKinnon MAINTAINED her OBJECTION.
A roll call vote was taken on the motion.
OPPOSED: Dunleavy, Hoffman, Micciche, MacKinnon, Bishop,
Kelly
IN FAVOR: Olson
The MOTION to adopt Amendment 16 FAILED (6/1).
Senator Hoffman WITHDREW Amendment 19.
3:50:24 PM
Co-Chair MacKinnon MOVED to ADOPT Amendment 20 (copy on
file):
Page 79, following line 19
DELETE: Sec. 28 (b) The amount necessary to pay the
first seven ports of call their share of the tax
collected under AS 43.52.220 in calendar year 2015
according to AS 43.52.230(b), estimated to be
$15,500,000, is appropriated from the commercial
vessel passenger tax account (AS 43.52.230(a)) to the
Department of Revenue for payment to the ports of call
for the fiscal year ending June 30, 2016.
EXPLANATION: Because this appropriation has been
overspent in recent years based on projected numbers,
it is the intent of the legislature that this program
be put on hold for one year to allow for proper due
diligence and accurate accounting so that when the
legislature appropriates these funds it will reflect
the revenue collected under this tax rather than its
projections.
Co-Chair Kelly OBJECTED for discussion.
Co-Chair MacKinnon discussed Amendment 20, explaining that
there had been a deficit after appropriating a projected
amount that was greater than the actual proceeds from the
commercial vessel passenger tax. She specified that any
funds collected while the program was on hold would be
available the following year.
Co-Chair Kelly WITHDREW his OBJECTION.
There being NO OBJECTION, Amendment 20 was ADOPTED.
3:51:37 PM
AT EASE
3:52:04 PM
RECONVENED
Co-Chair Kelly MOVED to ADOPT Amendment 21 (copy on file):
DEPARTMENT: Department of Administration
APPROPRIATION: Centralized Administrative Services
ALLOCATION: Commissioner's Office
EXPLANATION:
ADD CONDITIONAL LANGUAGE:
At the discretion of the Commissioner of
Administration and to accomplish the mission (intent)
of the Statewide 5 year Information Technology plan, a
new cost-neutral appropriation will be created within
the Department of Administration for the purpose of
consolidating information technology procurement,
information technology support and information
technology contractual services that are currently
being performed by executive branch agencies. The
Director of the Office of Management and Budget shall
authorize the transfer of funding associated with
these services.
Co-Chair MacKinnon OBJECTED for discussion.
Mr. Armstrong discussed Amendment 21, explaining that it
was brought to the committee for consideration by the
Office of Management and Budget.
3:53:13 PM
Co-Chair MacKinnon WITHDREW her OBJECTION.
There being NO OBJECTION, Amendment 21 was ADOPTED.
Co-Chair Kelly MOVED to ADOPT Amendment 22 (copy on file):
DEPARTMENT: Commerce, Community and Economic
Development
APPROPRIATION: Insurance
ALLOCATION: Insurance Operations
ADD: $217,200 Receipt Supported Services (1156)
POSITIONS: 2 PFT - Insurance Specialist I (PCN 08-
4046), Insurance Financial Examiner II (PCN 08-4058)
EXPLANATION:
The Insurance Financial Examiner II and the Insurance
Specialist I positions perform critical rate and form
filings and accreditation reviews related to the
regulation of insurance within the state. In 2014 the
Division of Insurance contributed approximately $55
million to the general fund, as well as another $9.2
million of fees and receipts that were used to fund
division operations. Reductions in staff and funding
will have an impact on the division's collections and
contributions to the general fund, and will slow the
service provided to the fee-paying public.
The Insurance Financial Examiner II position performs
financial examinations related to insurance. During
the state's last insurance accreditation review, this
position was highlighted as a need within the
Division. The division has experienced multiple hiring
challenges when recruiting for this position, and as a
result has rewritten the position description to allow
for hiring at multiple experience levels. This
position is expected to be posted for recruitment in
April 2015.
The Insurance Specialist I is assigned to the Property
and Casualty unit (P&C), which is charged with the
approval of all admitted form and rate filings,
including title and bonds, for the state. In addition,
the P&C unit monitors non-admitted insurers for
compliance with the statutory requirements of the
state. This position has been vacant while the
division reevaluated work processes, workload, and
needs; that process is nearing completion, and the
position is expected to be posted for recruitment in
April 2015.
The need for the work performed by these positions is
so great, that while these positions were vacant, the
division found it necessary to contract out for
services to satisfy statutory deadlines and
accreditation requirements, which is not a long-term
solution.
Mr. Armstrong discussed Amendment 22, explaining that it
restored a previously made reduction.
Co-Chair MacKinnon WITHDREW her OBJECTION.
There being NO OBJECTION, Amendment 22 was ADOPTED.
3:54:10 PM
Co-Chair Kelly MOVED to ADOPT Amendment 23 (copy on file):
DEPARTMENT: Natural Resources
APPROPRIATION: Land and Water Resources
ALLOCATION: Geological and Geophysical Surveys (DGGS)
ADD: $185,500 General Fund (1004)
POSITIONS: Add 1 PFT Division Operation Manager
EXPLANATION:
Restore the Division Operations Manager in DGGS who is
responsible for a wide variety of tasks including:
personnel and operations oversight, budget creation
and management, operations safety and improvements,
and long-range planning.
Responsible for coordination of numerous on-going
projects in mission-critical areas including: energy
resources, mineral resources, volcano monitoring and
geologic hazards. This position coordinates field
activities during the field season.
Division Operations Managers provide stability,
institutional knowledge, expertise, and understanding
of the division's operations and functions at all
levels. As the senior classified position in the
division, their existence allows operations to proceed
and critical functions and services to continue
smoothly across the transition between Directors.
Losing the Operations Manager position will leave the
division without long-term, experienced management
expertise to bridge the gap with each new Director.
Loss of this position will reduce the effectiveness of
the director, who will need to assume many of this
position's responsibilities.
Loss of this position will reduce the division's
capability to obtain external funding.
Note: This position was to have an increased workload
due to administrative and technical staff reductions,
increasing the need to effectively manage and
coordinate activities.
Co-Chair MacKinnon OBJECTED for discussion.
Mr. Armstrong discussed Amendment 23, explaining that the
issue came forth immediately after the closeout of the
departmental budget subcommittee.
Co-Chair Kelly asked Senator Bishop if it was a correct
characterization to describe the amendment as a late
recommendation from the subcommittee.
Senator Bishop stated that it was accurate, and the
position in question was important and leveraged other
federal dollars. He described it as a vital position and
pointed out that DNR had been cut by 45 positions.
3:55:23 PM
Co-Chair MacKinnon WITHDREW her OBJECTION.
There being NO OBJECTION, Amendment 23 was ADOPTED.
3:55:32 PM
AT EASE
3:58:09 PM
RECONVENED
Co-Chair Kelly stated that Amendments 17 and 18 would be
taken up the following day.
3:58:41 PM
AT EASE
3:58:57 PM
RECONVENED
Co-Chair Kelly stated the budget would be amended further
the following day. He discussed the state's fiscal
challenges, and pointed out that making large cuts was not
easy.
SB 72 was HEARD and HELD in committee for further
consideration.
SB 73 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
4:00:10 PM
The meeting was adjourned at 4:00 p.m.