Legislature(2017 - 2018)SENATE FINANCE 532
01/23/2017 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Presentation: Intent Language Report | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
SENATE FINANCE COMMITTEE
January 23, 2017
9:03 a.m.
9:03:32 AM
CALL TO ORDER
Co-Chair MacKinnon called the Senate Finance Committee
meeting to order at 9:03 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Anna MacKinnon, Co-Chair
Senator Click Bishop, Vice-Chair
Senator Mike Dunleavy
Senator Peter Micciche
Senator Donny Olson
Senator Natasha von Imhof
MEMBERS ABSENT
None
ALSO PRESENT
Megan Wallace, Attorney, Legislative Legal Services; David
Teal, Director, Legislative Finance Division.
SUMMARY
^PRESENTATION: INTENT LANGUAGE REPORT
9:04:43 AM
MEGAN WALLACE, ATTORNEY, LEGISLATIVE LEGAL SERVICES,
presented a legal background to the intent language. She
explained that most intent language was not enforceable.
Co-Chair MacKinnon asked for a restatement.
Ms. Wallace replied that legislative intent needed to be
the minimum necessary to explain the legislature's intent
regarding how money was to be spent. The intent could not
administer the program of expenditures. The intent must not
enact law or amend existing law. The intent may not extend
beyond the life of the appropriation. The language must be
germane.
9:09:02 AM
Senator Dunleavy wondered what would occur with a bill
separate from the appropriation that had its own intent
language voted on by the legislature.
Ms. Wallace responded that a request to put intent language
into substantive form, it would likely be the
recommendation that it be drafted in order to be put into
law in the department. Therefore, it could be enacted in a
way that mandated an agency or department.
Senator Micciche surmised that the intent language could
not be on an omnibus bill.
Ms. Wallace replied that appropriation bills were exempt
from the single subject rule. She stated that a substantive
bill would be bound by the single subject rule.
Co-Chair MacKinnon noted that there were attempts at
responses to requests from the agencies and industries
affected.
9:12:17 AM
DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION, shared
that he had a complied the FY17 Legislative Intent Language
into a summary (copy on file). He furthered that the
Legislative Finance Division (LFD) had compiled a memo
(copy on file). He outlined the color coding of the
spreadsheet. He felt that there was probably too much
intent language. He stressed that intent language was not
enforceable.
Co-Chair MacKinnon commented that there would be a bill
that directed where the reports would be delivered.
Mr. Teal felt that the intent should be a clear as
possible. He stressed that much of the intent could be
interpreted in various ways. He remarked that determining
compliance was not an easy decision. He remarked that there
could be differing opinions.
9:17:15 AM
Mr. Teal looked at item 2 of the spreadsheet. He stated
that the intent language was not followed. A viable
replacement was not found.
Mr. Teal noted that item 3 complied with the language,
although a viable replacement was not found.
Mr. Teal looked at item 4, and remarked that it did not
follow the language in the intent. He stressed, however,
that there was progress.
Mr. Teal addressed item 5 related to tourism marketing. He
remarked that in FY 17 funding for tourism marketing was
$1.5 million of UGF. The request in FY 18 was out of the
operating budget and put in the capital budget at $1.35
million of UGF, plus vehicle rental taxes of $1.65 million.
The UGF was reduced, but total GF was increased. The intent
did not outline whether there was an intended reduction of
state funds or UGF. He stressed that the industry plan
called for an $8 million assessment on industry, and using
$10.5 million of vehicle rental tax. He stressed that the
tax was used by other agencies for other purposes mostly
related to tourism development.
Mr. Teal addressed item 6, which was related to the
Marijuana Control Board. He stressed that the board did not
set fees to recover unrestricted general funds, because the
fees were set before the intent language was adopted.
Mr. Teal looked at item 15. He stated that the intent was
to find other sources of money to fund the Mount Edgecumbe
High School Aquatics Facility. He shared that the
Department of Education and Early Development (DEED) had
identified some non-GF sources, but still requested an FY18
increment of $100.0 UGF to open/operate the facility.
9:22:11 AM
Mr. Teal addressed item 17. He shared that the legislature
asked DEED to turn to Alaska Housing Finance Corporation
(AHFC) for energy efficiency loans. He stated that DEED
felt that the loan option would not meet the needs of many
applicants.
Senator von Imhof wondered whether the Mount Edgecumbe pool
was currently not in operation.
Mr. Teal responded that he believed the pool was complete,
but not in operation. They would maintain the empty pool,
because they had no funds to operate it.
Senator von Imhof wondered whether there was another pool
in Sitka that could be used.
Mr. Teal replied in the affirmative.
Senator von Imhof wondered whether that pool was in use.
Mr. Teal responded in the affirmative.
Senator Micciche wondered how the intent language was
communicated to the departments. He asked how the
departments prioritized the legislative intent.
Mr. Teal responded that the intent language was in one of
the appropriation bills, and was communicated in that
matter to the departments. He stated that they were
addressed in the fall regarding compliance. He shared that
intent language was unenforceable, but the departments
still intended to follow the intent language. He stressed
that intent language was particularly important during a
legislature, rather than an election year when a
subcommittee chair may be different. He stressed that there
are many reasons for not complying with intent language,
such as lack of funding.
9:25:39 AM
Senator Dunleavy wondered how to enact change.
Co-Chair MacKinnon understand that the solution would be
made together because of conversations. She stressed that
the legislature could not halt the building of the swimming
pool. She explained that there was a difference between
operating expenditures and capital expenditures.
Senator Micciche understood that the source of the intent
language was approved by the legislature and the governor.
9:33:10 AM
Senator Dunleavy felt that the report indicated some lack
of execution of the intent of the legislature. He stressed
that there had to be a determination of the best use of
time.
Co-Chair MacKinnon shared an example of the reappropriation
process.
Senator von Imhof hoped to examine the individual projects
within programs.
9:40:11 AM
Co-Chair MacKinnon shared that conversations had taken
place regarding the Mt. Edgecumbe pool.
Senator Olson remarked that the intent of the pool in Sitka
was to address the large number of drownings in rural
Alaska.
Mr. Teal responded that the language should be the minimum
necessary to explain the intent of the appropriation. The
intent should not administer the program.
Senator Olson wondered whether it was a waste of time to
discuss intent language.
Mr. Teal felt that less intent may be more effective than
more intent.
9:45:26 AM
Vice-Chair Bishop remarked that 44 of 88 of the topics had
followed the intent of the legislature. He asserted that
the administration must approve of those topics.
Mr. Teal replied that most of the agencies complied with
most of the intent, because they followed what was already
common practice. He stated that there were very good
reasons why there was not compliance with intent language.
Senator Micciche suggested that there may be a guidance
document from LFD and Legislative Legal for the
subcommittee chairs, when drafting their requests.
Co-Chair MacKinnon shared that the reason for the
discussion was in order for the Senate to prioritize their
budget.
9:50:10 AM
Mr. Teal looked at item 22, which showed that due to FY17
budget reductions, two projects addressing Upper Cook Inlet
stocks of concern (the Judd Lake Weir and Yentna River Fish
Wheel) were deleted.
Mr. Teal addressed item 25. He remarked that there was an
attempt to get the information to the public.
Mr. Teal highlighted items 30 and 31. The intent asked
Department of Fish and Game (DFG) to examine how they
survey fishermen. He stated that DFG responded that
altering their survey techniques would be too costly, and
the quality and quantity of data may suffer with those
changes. He stated that it was white on the spreadsheet,
because they were only required to evaluate, but chose not
to adjust their practice.
Co-Chair MacKinnon queried the item numbers.
Mr. Teal replied that he was discussing items 30 and 31.
Mr. Teal looked at item 33, which showed that the intent of
the legislature that the duties performed by the deleted
Information Officers are absorbed within the Office of the
Governor, in which the office did not comply.
Mr. Teal looked at item 38, which referred to attempts to
privatize certain services. He stated that each agency had
its own report and ability to discuss their progress.
Mr. Teal addressed item 39, which related to collocation of
several state corporations including Alaska Aerospace
Corporation (AAC), Alaska Energy Authority (AEA), Alaska
Housing Finance Corporation (AHFC), and Alaska Industrial
Development and Export Authority (AIDEA) to reduce
administrative costs and duplication of services within
those agencies. He stated that Department of Administration
(DOA) was coordinating a plan to collocate the AEA, AIDEA
and AHFC. The review did not include AAC.
Mr. Teal looked at item 40 discussed the transferring of
investment responsibility of the CBR out of the Treasury to
the Permanent Fund, and that intent was not followed.
Mr. Teal looked at item 44, which related to construction
of roundabouts at Chena Hot Springs. The intent language
asked that there not be any general fund money used. He
stressed that most transportation was funded with match
funding, so it was unknown whether the intent language was
followed. He shared that the plan would use 100 percent
federal money.
9:55:12 AM
Mr. Teal looked at items 47 and 48, and both discussed
repurposing the youth facilities. He stated that each
facility was closed, instead of repurposed.
Mr. Teal addressed items 50 and 51, which stated that the
investment would be too great. The department reported that
it would require an investment in other resources.
Mr. Teal highlighted item 62, which related to holding down
the indirect costs for Village Public Safety Officers
(VPSO). He stated that it may appear that there was an
intent to hold the indirect cost rate at under 30 percent.
The language was intended to work the opposite way, by
allowing some contractors to have indirect rates much
higher than 30 percent.
Mr. Teal looked at items 67, which required savings at
rural airports. The intent was considered, however the
proposed FY18 budget does not include any reductions.
Mr. Teal highlighted item 68, which directed Department of
Transportation and Public Facilities (DOTPF) to open and
staff three maintenance stations, but the funding was
vetoed, so they did not comply.
Mr. Teal addressed item 69, which addressed cost of living
differentials for maritime union employees. It was found
that the intent could not be met without a statutory
change.
Mr. Teal looked at items 74 through 81, which required the
university to examine their own organization.
Mr. Teal addressed item 82, which he felt was a clear
noncompliance by the university. The personal services were
supposed to be reduced, but they were unable to reduce
personal services because of bargaining agreements.
9:58:49 AM
Co-Chair Hoffman felt that the focus should not be strictly
on the operating budget. He did not want to focus too hard
on the legislative intent. He hoped to give direction to
subcommittees to minimize any legislative intent, and to
complete the budgetary process. He remarked that the senate
had proposed to reduce the budget by $300 million, and some
felt that the reduction was too drastic. He reiterated that
there was a $3 billion budget deficit. He stressed that the
time should be spent on addressing the fiscal dilemma,
which the governor classified as a "crisis."
Co-Chair MacKinnon queried the percentage of the budget in
formula programs.
Mr. Teal replied that 50 percent of the budget was formula
programs.
10:04:00 AM
Co-Chair MacKinnon wondered if there would be $3 billion
for the budget, with 50 percent removed.
Mr. Teal replied in the affirmative.
Co-Chair MacKinnon shared that the programs needed to be
reformed, because there was a $3 billion shortfall.
Co-Chair Hoffman stressed that the timeframe was limited.
Co-Chair MacKinnon was grateful for the administration's
attendance to the committee meetings.
10:07:02 AM
AT EASE
10:07:10 AM
RECONVENED
Co-Chair MacKinnon discussed the following day's agenda.
ADJOURNMENT
10:07:49 AM
The meeting was adjourned at 10:07 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 012317 LFD FY17 Final Intent Memo 1 21 17.pdf |
SFIN 1/23/2017 9:00:00 AM |
Operating Budget FY18 |
| 012317 LFD FY17 Final Intent Summary Table (2).pdf |
SFIN 1/23/2017 9:00:00 AM |
Operating Budget FY18 |