Legislature(2025 - 2026)SENATE FINANCE 532
02/12/2025 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB56 || SB58 | |
| Letters of Agreement | |
| Alaska Gasline Development Corporation | |
| Letters of Agreement | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 56 | TELECONFERENCED | |
| *+ | SB 58 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
SENATE FINANCE COMMITTEE
February 12, 2025
9:01 a.m.
9:01:36 AM
CALL TO ORDER
Co-Chair Hoffman called the Senate Finance Committee
meeting to order at 9:01 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Mike Cronk
Senator James Kaufman
Senator Jesse Kiehl
Senator Kelly Merrick
MEMBERS ABSENT
Senator Donny Olson, Co-Chair
ALSO PRESENT
Pete Ecklund, Staff, Senator Lyman Hoffman; Alexei Painter,
Director, Legislative Finance Division; Lacey Sanders,
Director, Office of Management and Budget; Frank Richards,
President, Alaska Gasline Development Corporation; Senator
Cathy Giessel.
SUMMARY
SB 56 APPROP: OPERATING BUDGET; CAP; SUPP
SB 56 was HEARD and HELD in committee for further
consideration.
SB 58 APPROP: MENTAL HEALTH BUDGET
SB 58 was HEARD and HELD in committee for further
consideration.
PRESENTATION: LETTERS OF AGREEMENT
PRESENTATION: Alaska Gasline Development Corporation
SENATE BILL NO. 56
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs; capitalizing funds; amending
appropriations; making supplemental appropriations;
making reappropriations; 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."
SENATE BILL NO. 58
"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."
9:03:07 AM
Co-Chair Stedman MOVED to ADOPT the committee substitute
for SB 56, Work Draft 34-GS1462\N (Marx, 1/31/25).
Co-Chair Hoffman OBJECTED for discussion.
9:03:13 AM
PETE ECKLUND, STAFF, SENATOR LYMAN HOFFMAN, explained the
committee substitute.
Co-Chair Hoffman WITHDREW his objection. There being NO
OBJECTION, it was so ordered.
Co-Chair Stedman MOVED to ADOPT the committee substitute
for SB 58, Work Draft 34-GS1459\N (Marx, 1/31/25).
Co-Chair Hoffman OBJECTED for discussion.
Mr. Ecklund explained the CS.
Co-Chair Hoffman WITHDREW his objection. There being NO
OBJECTION, it was so ordered.
SB 56 was HEARD and HELD in committee for further
consideration.
SB 58 was HEARD and HELD in committee for further
consideration.
^LETTERS OF AGREEMENT
9:05:28 AM
ALEXEI PAINTER, DIRECTOR, LEGISLATIVE FINANCE DIVISION,
(LFD) discussed the background and concept of Letters of
Agreement. He shared that LOAs were amendments to signed
contracts that altered the original contracts. The changes
could include adjusting scheduling or could constitute
monetary terms. He relayed that, for example, in 2022 the
administration signed an LOA with the Department of
Corrections that would offering hiring bonuses. He said
that the LOA had not bee brought before the legislature
because the agency had existing funding because of several
vacant positions. However, a legislative legal finding had
found that legislative approval was needed because it was a
monetary change in the bargaining contract. He shared that
the Department of Law disagreed with that opinion. He felt
that it was important that the committee be aware of the
issue when discussing salary studies or compensation of
state employees because LOAs influenced the expenditures of
the state when they were used to recruit and retain
employees. He added that if the LOAs were financed using
money from vacant positions how would they be financed when
those positions were filled. He stated that the language
had been added to the operating budget to show that the
legislature approved of the LOAs provided the Office of
Management and Budget send the legislature the LOAS along
with cost estimates prepared for them. He noted that at
first the Department of Administration had been asked for
the LOA information, which had been changed to OMB in FY25.
Co-Chair Stedman asked for the total annual request for
LOAs from year to year.
Mr. Painter replied that Ms. Sanders would address the
questions. He shared that the largest he could think of was
the signing bonus for correctional officers. He added that
DOC had once added a 2 percent wage increase as an LOA.
9:11:07 AM
Co-Chair Stedman requested an explanation of the state
employee salary schedule.
9:11:44 AM
Mr. Painter replied that in the state payroll system, job
classifications were generally put at a range, somewhere
between 8 and 30. The range set the base salary by job
class. Merit steps could increase within a range,
approximately 3.5 percent, per step, within the range. Some
employees started at advanced ranges. The first few steps
were given annually and after that every other year. The
number of steps would depend on the bargaining unit
agreement. He said employees were paid in this system of
ranges that was set by the position title, with merit
increases increasing with longevity.
9:13:30 AM
Co-Chair Stedman clarified that the merit and step
increases increased with longevity and were not performance
bases.
9:13:54 AM
Mr. Painter replied that the merit steps required
acceptable performance evaluation. He said that some
agencies had the ability to give an extra merit step for
outstanding performance but was a rare occurrence.
9:14:17 AM
Co-Chair Hoffman recalled that in the past the legislature
had passed legislation that increased some of the ranges.
9:14:40 AM
Mr. Painter explained that in FY 24 the Capital Budget, the
governor requested, and the legislature approved, a $1
million project to prepare a statewide salary survey that
was expected to be released in June 2024. The
administration had indicated that the study would be
available in March 2025. The study was meant to examine
whether the states compensation system was adequately
competitive to attract and retain employees. He said that
the last similar study had been done in 2009, the results
of which had not been implemented by the legislature at the
time.
9:16:25 AM
LACEY SANDERS, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
(OMB) explained that she had prepared some remarks
concerning LOAs. She reiterated the definition of an LOA.
She said that the letter should indicate a timeframe
identified for the temporary agreement. She stated that the
intent of the letters was to have something in place until
a solution could be found or future bargaining negotiations
occurred. She proved several examples.
9:19:12 AM
Ms. Sanders explained that, over the last three years the
administration had experienced and influx in the number of
signed LOAs as the state had been experiencing difficulties
in hiring and retention. She shared that the LOAs were
paper documents with a tracking number but no electronic
tracking mechanism with no way to tie the states
accounting system to the LOAs. Additionally, the state had
an increased level of difficulty with the calculations
associated with those LOAs. The Division of Finances
payroll section had worked through a manual calculation
process and other solutions to address each LOA as it come
before them, which increased the difficulty in processing
payroll calculations. She said that in August of 2023, a
temporary pause had been issued on new LOAs as the division
worked to identify all existing LOAs to ensure they were
properly paid. She stated that the ability to address
specific the life, health, or safety situation of each LOA
had been done on an ad hoc basis as the items presented
themselves. She relayed that the pause was intended to
allow the division to prioritize the payroll being process
and to ensure the 100 percent of the payroll was processed
timely and accurately. She related that an increase of
notice of pay problems had been identified at this time.
She said that the implementation of so many LOAs had
increased the difficulty of processing payroll, which
compounding the hiring and retention difficulties. She
noted that language in the appropriation bills from the
previous year that required OMB to ensure that a copy of
the signed LOA was transmitted to the LFD, along with a
cost estimate. She said that a standardized const estimate
template had been introduced that departments used to
estimate the impact and how the cost associated with the
LOAs would be addressed. She added that the language also
st
requested two reports, one of February 1, and another in
September. She stressed that OMB was working diligently to
meet the requirements of the budget language. She noted
that the initial report transmitted had been very simple
and did not include much of the details that LFD would used
to analyze the data. She said that the Division of Finance
had pulled together a more detailed report for the LFD,
dated February 10, 2025, which would provide more detailed
information. She stated that the nature of IRIS did not
allow for a full capture of the financial impacts of LOAs.
She said that individual departments could examine how the
LOAs were impacting them financially. She expounded on the
difficulty of establishing what was due because of an LOA
and what was standard pay. She said that approximately $3.5
million had been captured in the current accounting system.
She believed that there were more costs associated with the
LOAS that had yet to be identified. She stressed that all
st
parties were working to set up a clean slate by July 1
that would establish an individual tracking code tied to
each LOAS to provide detailed costs of each agreement.
9:26:33 AM
Co-Chair Stedman wondered whether the implementation of
changes triggered by the forthcoming salary study would
alleviate the need for LOAs.
9:26:57 AM
Ms. Sanders replied that there would always be a need to
have LOAs. She said that LOAs were intended to be temporary
and were not meant to be used in perpetuity.
9:27:30 AM
Co-Chair Hoffman asked how long the state had been issuing
LOAs.
9:27:37 AM
Ms. Sanders replied that she did not know and would get
back to the committee with the information.
9:27:55 AM
Senator Kiehl understood LOAs were a temporary tool. He
noted some LOAs from years ago for supervisory units and
asked whether those LOAs were still in effect.
9:28:35 AM
Ms. Sanders replied a coordinated effort needed to be made
to determine whether those LOAs should be negotiated into
contracts. She also noted the need for termination dates in
LOAs to ensure they did not cross over into the next
negotiated contract.
9:29:26 AM
Senator Kiehl contended the LOAs he was speaking of did
have end dates.
9:29:54 AM
Ms. Sanders replied that each individual LOA had to be
evaluated to determine whether it had been addressed. She
reiterated that LOAs had been issued broadly over the last
few years and needed to be reevaluated and reconciled. She
said that the hope was that by July 1 there would be a
reset and evaluation of each LOA.
Senator Kiehl asked what reset meant.
9:30:57 AM
Ms. Sanders replied that reset meant working through to
identify all the existing LOAs, in all departments, and
ensuring they were still necessary. She thought that there
were LOAs existing that were being rolled forward on an
annual basis. She said that the reset would be a restart at
the start of the fiscal year. She reiterated that the
process would take work.
9:31:59 AM
Senator Kiehl understood that there was no default if the
work took longer than expected and thing would not drop.
9:32:12 AM
Ms. Sanders replied that the intention was to ensure that
the state had the workforce necessary and the tool in place
to meet the workforce needs.
9:32:32 AM
Co-Chair Hoffman announced that in the past there had been
language in the budget bills to approve the LOAs. He
wondered if approval could be contingent to the passage of
a supplemental budget or was it a timing issue.
9:33:03 AM
Ms. Sanders replied that she did not know. She said she
would get back to the committee with the information.
9:33:31 AM
Co-Chair Hoffman stated that Mr. Painter would return to
the table to respond to questions from the January 29,
2025, meeting.
9:33:47 AM
Mr. Painter addressed questions from the January 28, 2025,
Senate Finance Meeting (copy on file):
Senator Stedman asked for a table showing past
Permanent Fund Statutory Net Income.
Senator Merrick asked how long it would take to retire
current school debt if the moratorium is extended.
The current debt schedule shows that debt will
remain outstanding through FY40, although the
total per year falls under $1 million beginning
in FY37.
Mr. Painter noted that the new table showed that statutory
net income had been more volatile. He said that part of the
reasoning for the POMV draw being based on the value of the
fund versus the value of the earning was that the previous
number was more stable.
9:36:14 AM
Co-Chair Stedman asked about debts on hard assets like
dams. He wondered about school building refinancing and
whether the amortization could be stretched out when
refinancing. He was curious about school building financing
and the stretching of amortization. He wondered if the
practice would make it harder to pay off debt.
Mr. Painter replied that debt managers often looked at
whether refinancing would save money in net present value
terms. He shared that GO bonds had been refinanced in 2024-
25, which had lowered total payments for the state, but did
stretch out the amortizations, resulting in a longer period
before the bonds were paid off.
9:38:45 AM
Co-Chair Stedman thought that the discussion should
continue. He provided an example of a dam that had been
financed in Sitka in the mid-80s, which had been refinanced
twice. He said that upon wanting to build another dam, the
first dam had yet to be paid off, which hindered financing
the new project. He said that the net present value was a
variable but was only one variable. He lamented that the
state had many aging schools and hoped that the matter
could be discussed further.
9:40:34 AM
Senator Kiehl understood that to get bond reimbursement the
school project had to be approved by DEED and the state
bond Reimbursement Grant Review Committee. He asked whether
the committee also had to approve refinancing.
Mr. Painter responded that he did not know but would get
back to the committee with the information.
9:41:11 AM
Co-Chair Stedman clarified the new manager of the municipal
bond bank had been counseled to get things paid off in a
timely manner so that funds could be available for other
projects.
9:41:48 AM
AT EASE
9:42:08 AM
RECONVENED
Co-Chair Hoffman noted that Alaska Gasline Development
Corporation had a limited amount of time for their
presentation.
^ALASKA GASLINE DEVELOPMENT CORPORATION
FRANK RICHARDS, PRESIDENT, ALASKA GASLINE DEVELOPMENT
CORPORATION, (AGDC) stated that he would provide responses.
He discussed the FY 2026 budget request (copy on file).
9:44:35 AM
Mr. Richards discussed the capital budget request:
$4,200.0 General Fund Request Provides funding for:
• Technical and Legal expertise needed for development
of agreements/ contracts with investor(s), utilities,
base industrial customers, gas purchase and gas sale
agreements
• Expertise to work with Department of Energy on the
establishment of loan guarantees
• Maintain compliance and secure data management
systems, geographic information systems capabilities,
and stakeholder databases
• Keep permits current and interface with State of
Alaska and federal regulators ranging from water
quality, culture resources, material sites, and
highway use agreements
• Payment of permit fees and lease costs
• Support AGDC's role as minority owner representing
the State's interests during FEED with technical,
regulatory, and project management expertise
9:47:11 AM
Co-Chair Stedman asked for a breakdown of the $4.2 million
request into bullet points that would illuminate the costs
of each component. He thought perhaps some of the items
could be funded in the operating budget.
9:47:48 AM
Mr. Richards agreed to provide that information.
9:47:59 AM
Senator Kiehl noted that the request was to get to FEED
over the next two fiscal years. He asked whether the $4.2
million request would cover the project to FEED even if
it took longer than projected.
Mr. Richards replied that the request was looking out to
FY26. He said that once FEED began, the expertise would be
needed. He said that if FEED did not start until FY26, the
corporation would return to the committee to aske for more
funds. He said that the schedule was based on starting FEED
in calendar year 2025, and the request was geared toward
that.
9:49:17 AM
Senator Kiehl //
9:49:27 AM
Mr. Richards replied that it was twelve months of funding.
9:49:39 AM
Senator Kiehl asked whether the funding was for 16 months
or funding through FEED.
Mr. Richards said that the funding request was for 12
months of funding.
Senator Kiehl retorted that 12 months of funding sounded
more like an Operating Budget request.
9:49:44 AM
Mr. Richards concluded his remarks.
9:49:54 AM
Co-Chair Stedman requested an explanation of the project
and whether there was any new foreign interested or special
interest by the federal government.
Mr. Richards replied that the interest in the project had
grown under the current administration. He noted a meeting
with the president and the Prime Minister of Japan. He said
that good conversations were happening, and that Japan saw
a keen value in LNG from Alaska. He offered a brief
overview for the public of the status of the project. He
said that Phase One of the project was the major impetus.
9:53:53 AM
Co-Chair Stedman noted that the budget request included
money for travel. He asked for the travel schedule and who
Mr. Richards planned on meeting in Washington D.C.
9:54:17 AM
Mr. Richards replied that he had no plans to travel to
Washington, only to Juneau to present to committees. He
added that he might go to a large gather of oil and gas
people in Huston, Texas to talk about the project.
9:54:54 AM
Co-Chair Stedman suggested that AGDC consider asking the
federal government for an equity infusion to complete Phase
One.
9:56:04 AM
Mr. Richards replied that everything was on the table.
9:57:17 AM
Co-Chair Hoffman felt that things were still unfolding in
Washinton D.C. as it related to the gasline project.
^LETTERS OF AGREEMENT
9:58:01 AM
Ms. Sanders addressed questions from the January 27, 2025
Senate Finance Meeting (copy on file):
1. How much of the amount requested for State
Retirement Payments goes towards the unfunded
liability?
In regard to the State Retirement Payments
appropriation, 100 percent of the $218,718.0 goes
towards the unfunded pension liability.
2. What is the cost of the top five employees at the
Alaska Gasline Development Corporation (AGDC) and
Alaska Industrial Development and Export Authority
(AIDEA) (salaries and benefits)?
The below table provides the salaries and
benefits for the top five positions within AGDC
and AIDEA. Note, the AGDC component has only four
permanent full-time positions.
9:58:57 AM
Co-Chair Stedman asked whether it was safe to assume that
all the state employees on the tables were under the
standard retirement tier related to their date of hire.
9:59:09 AM
Ms. Sanders replied that the graph included the totality of
the salary and benefits, including retirement and health
insurance.
9:59:17 AM
Co-Chair Stedman asked whether the salaries were scheduled
like other state employees.
9:59:40 AM
Ms. Sanders replied that each agency fell into exempt
status and did not follow the classified positions status
on a state salary schedule. The salaries were set by the
corporations.
10:00:10 AM
Co-Chair Stedman asked what the employees retirement tier
would be based on.
10:00:14 AM
Ms. Sanders replied that the retirement tier was based on
the individual date of hire.
10:01:05 AM
Co-Chair Stedman expressed concern over the exorbitant
salaries. He said that the defined benefit plan was geared
to be funded over years of service at a salary range. He
said that jumping up to huge salary ranges at the end of a
career could result in unfunded liability to the state.
10:01:47 AM
Ms. Sanders replied that she understood Senator Stedmans
point. She would need to look deeper to provide a
comprehensive answer.
Co-Chair Hoffman asked her to look deeper and provide
recommendations on how the matter could be controlled.
Co-Chair Stedman acknowledged that the question was broad.
He noted that the salaries were significant and held people
nearing the end of their careers, which would result in a
significant expense to the state.
10:02:54 AM
Ms. Sanders agreed to investigate the question and get back
to the committee.
10:02:59 AM
Co-Chair Hoffman understood that the problem could not be
fixed retroactively but could be controlled in the future.
Co-Chair Stedman believed that awareness was key. He felt
that some agencies had salaries that were significantly
larger than others.
10:04:00 AM
Senator Kiehl hoped that the data from the Alaska
Experience studies, that quantified how often people jumped
up in salary during their final few years of work, would be
built into the systems funding ratios. He understood that
for the most recent defined benefit tiers the employee had
to have a geographic differential for 50 percent of their
time working in the system before a geographic pay
differential could be applied to a salary.
Ms. Sanders replied that the question was beyond her area
of expertise. She agreed to follow up with the committee.
10:05:06 AM
Senator Cronk asked for details about the employee
benefits.
Ms. Sanders replied that the rates were applied for
benefits when a salary was set. She shared that benefits
would grow as the salary grew.
Co-Chair Hoffman interjected that medical benefits also
grew and could be substantial.
Ms. Sanders agreed.
10:05:41 AM
Ms. Sanders continued to address the responses:
3. How much is invested in subsistence? Provide a
detailed breakdown of the subsistence budget. How do
the investments in other areas of the Department of
Fish and Game (DFG) impact subsistence?
Subsistence investments are in the Subsistence
Division, Divisions of Commercial Fisheries,
Sport Fisheries, and Wildlife Conservation. A
detailed breakdown of the Division of
Subsistence's budget would not accurately reflect
the State's investment but is attached (Enclosure
A Subsistence Budget Breakdown - final.pdf).
Below are what each division contributes directly
to subsistence; this does not include the
indirect costs associated with management of the
awards, processing payroll, etc.
Subsistence:
The Division of Subsistence has an annual budget
of roughly $7.5 million, of which less than half
is unrestricted general funds. The division
fulfills its mission, mandated by Alaska Statute
16.05.094, to conduct studies to gather
information from residents of communities
throughout Alaska on all aspects of the role of
subsistence hunting and fishing in the lives of
residents by conducting research in collaboration
with community entities, regional non-profits,
agencies, various local and tribal governments,
as well as in partnership with our sister
divisions within DFG. Most of the projects
throughout the state are partnerships. Some of
the current partners include the National Oceanic
and Atmospheric Association, Bureau of Ocean and
Management, U.S. Forest Service, University of
Alaska Fairbanks, Tanana Chiefs Conference,
Bristol Bay Native Association, Chugach Regional
Resources Commission, Sitka Tribe of Alaska,
Alaska Migratory Bird Co-Management Council,
Center for Alaska Native Health Research, the
cities of Tenakee Springs, Pelican, and Gustavus,
as well as a variety of communities and tribes
throughout the state.
Commercial Fisheries:
Managing Alaska's fishery resources for sustained
yield is the Division of Commercial Fisheries'
(DCF) highest priority. For fish stocks where a
harvestable surplus exists, the division's
highest priority is ensuring subsistence needs
are met. The DCF uses data obtained from research
and stock assessment projects to ensure they are
meeting the sustained yield mandate and
subsistence priority. Projects that contribute to
management of subsistence fisheries include fish
counts, stock assessments, estimates of fish
abundance, harvest surveys, catch summaries, and
research related to biology of various fish
stocks. These projects also ensure that
commercial and personal use fisheries are managed
in accordance with sustained yield principles.
Projects that touch on management of subsistence
fisheries comprise roughly half of the division's
$88 million budget and uses multiple funding
sources.
Sport Fish:
The Division of Sport Fish (DSF) directly manages
subsistence fisheries in the Glennallen
Subdistrict salmon fishery (unrestricted general
funds) and several other small fisheries across
the state. The DSF funding sources, such as Fish
and Game and Dingell Johnson funds, cannot be
used to directly manage a subsistence-only
fishery. However, many of the division's stock
assessment and research projects for salmon and
resident fish species provide critical data for
managing sport, personal use, and subsistence
fisheries. This supports the subsistence priority
and helps sustain fish populations, indirectly
benefiting subsistence fisheries statewide,
particularly in the Arctic Yukon Kuskokwim (AYK)
Region.
Without these assessment projects, fisheries,
including subsistence fisheries, would likely
face restrictions or closures. Depending on the
stock assessment projects conducted each year,
the DSF allocates an estimated $2 to $4 million
of its annual budget (approximately five to 10
percent of the overall budget) to initiatives
that benefit subsistence and sustain yield
priority.
Wildlife Conservation:
The Division of Wildlife Conservation (DWC)
manages hunting and trapping opportunities in the
state, which includes subsistence. The DWC
supports DFG's subsistence services through a
variety of federal grants. The following is a
list of subsistence-related projects federally
funded through the DWC: Emperor goose harvest and
management in Alaska; Socio-Economic
Characterization of bird harvests in rural
Alaska; and Investigating the human dimensions of
migratory and game bird harvests and ceremonial
harvest of game populations in Alaska. Within the
DWC Marine Mammals Program, research is conducted
to monitor the health and status of marine mammal
species important for sustainable subsistence
harvests. Research projects range from health and
disease assessments, abundance surveys, harvest
monitoring, and traditional knowledge
documentation. This work occurs in partnership
with coastal communities of Alaska from Kaktovik
to Dillingham. The program spends roughly $1.9
million annually on these projects. The DWC's
Threatened, Endangered, and Diversity Program
provides input to setting the regulatory
framework for subsistence uses of seabirds and
shorebirds through the Alaska Committee. The
majority of the DWC's core work and
responsibilities are associated with subsistence.
The division is charged with providing
opportunities to utilize wildlife resources, and
to ensure sustainability and a harvestable
surplus of wildlife resources. In fulfilling
these core services, the DWC is directly involved
with the majority of subsistence use of wildlife
in the State of Alaska. The division also
provides education services across the state to
encourage new generations of hunters and support
good hunting practices, as well as safety.
10:06:39 AM
Ms. Sanders continued with the responses:
4. Regarding the 988 call center that started in the
prior fiscal year, how that was funded and why is this
funding request coming now?
The call center has been in operation for over 20
years and has answered Suicide Prevention
Lifeline (now 988) calls since the Lifeline
began. The current call center contract started
in 2022 and ends June 30, 2025. The Department of
Health will issue a request for proposals for a
new contract. There has been an increase in
Alaskans utilizing the call center in recent
years as it is a number that is easier to
remember, along with statewide and national media
campaigns. In recent years, the contract has
partly been supported with American Rescue Plan
Act federal grants and other federal grants,
which are expiring. The $1,500.0 ($750.0 UGF;
$750.0 Other) for this request is needed to
maintain current services.
5. What is being done to make it easier for Alaskans,
especially rural Alaskans, to get a Commercial
Driver's License (CDL). What can or is being done to
provide assistance to Alaskans to get them to work on
the Slope as Operating Engineers, which includes
Mechanics and Operators?
The Division of Employment and Training Services
(DETS) and the Alaska Workforce Investment Board
(AWIB) provide financial assistance to Alaskans
for them to obtain the training and credentials
they need to meet their career goals. This
includes providing support to training providers;
covering the cost of the actual CDL and Mechanic
and Operator training; covering the cost to
travel to take the CDL test; and covering the
cost for an individual to relocate to take a job
on the Slope or elsewhere. In FY2024, the DETS
provided over $2.9 million in support to 377
Alaskans seeking a CDL and nearly $300.0 in
support to 28 Alaskans seeking to be Operating
Engineers. The AWIB has provided State Training
and Employment Program (STEP) and Technical
Vocational Education Program (TVEP) funded grants
to 13 training providers who are providing CDL
and/or mechanical training opportunities.
The main challenge with providing CDL training
and testing in rural Alaska is that most rural
areas do not meet the road requirements for a CDL
test. That said, training providers are actively
working to make the obtaining of a CDL easier for
Alaskans. For example, Mining and Petroleum
Training Services (MAPTS) is working with AKA
Hauling to offer a side-by-side CDL training with
their Heavy Equipment (HE) program where the
students will receive training for both and then
stay an additional two days after completing the
HE program to take the CDL test. AKA Hauling has
worked to make a CDL compliant road in King
Salmon so Alaskans in the area can be tested
locally. Additionally, Northern Industrial
Training (NIT) contracts with communities to
provide training in the home community and
testing in Anchorage.
The Alaska Vocational Technical Education Center
(AVTEC) provides mechanic training through our
Diesel/Heavy Equipment Technology program,
preparing students for careers as diesel
technicians, equipment mechanics, and related
fields. Currently, each class trains 10 students
per term, though historically, class sizes have
been as high as 15 students.
Expanding the Diesel/Heavy Equipment Technology
program to increase student capacity would
require:
• An additional instructor position to
support a larger student load.
• Additional training engines (an estimated
five more engines would allow for a more
effective expansion).
• Consideration of dorm space constraints,
especially with the planned increase in
Industrial Electricity (IE) and Plumbing and
Heating (PandH) students.
The AVTEC does not currently offer CDL training
due to the lack of immediate access to complex
road conditions necessary for comprehensive
training and testing. Integrating CDL training
within the AVTEC's existing Diesel/Heavy
Equipment Technology program is something that
has been discussed and is possible. Such an
expansion would require careful planning and
additional resources, including:
• A CDL-qualified instructor (currently,
only one staff member holds a CDL, but does
not teach in this area).
• Appropriate training vehicles (potentially
two trucks) and a designated storage space,
which AVTEC currently lacks.
• A compliant training site with road access
suitable for CDL instruction.
• Approval and curriculum development, which
would take timelikely extending
implementation into FY2027.
The AVTEC is eager to provide vocational
training wherever there is a need. While
challenging to implement a new program, a
CDL training is an area that could be
explored if additional resources and
infrastructure became available.
6. How many Village Public Safety Officer (VPSO)
positions are filled? What is the turnover rate for
that?
As of January 29, 2025, there are 86 VPSOs
employed by the grantees, making the vacancy
zero. The turnover rate for FY2025 is 18.4
percent.
10:08:44 AM
Co-Chair Hoffman asked whether there was adequate funding
in the current budget to fund the VPSOs.
10:08:50 AM
Ms. Sanders replied that there was adequate funding to
support the grants that paid for the VPSOs.
10:09:07 AM
Ms. Sanders continued to address responses:
7. Is the service area for the new Talkeetna post in
an organized borough?
Yes, the service area for the new Talkeetna post
falls within the Matanuska-Susitna Borough. While
second-class boroughs in Alaska may adopt police
powers with voter enforcement agency.
10:09:29 AM
Senator Kiehl noted that there were not a borough wide
police powers without a change of the charter. He wondered
whether an amendment could be put forth to provide police
power borough wide in his district.
10:10:20 AM
Ms. Sanders said there could be a discussion with the
department about the needs of each community. She said her
understanding was that the increase of activity in the
specifically cited area warranted the reopening of the
post.
10:11:11 AM
Co-Chair Hoffman thought that Senator Kiehls question
should be brought up during Department of Public Safety
subcommittee meetings. He said that the question was
whether the state should come forward to address the needs
of the borough or if the need were better addressed by the
borough. He thought that the administration had come
forward with a proposal but that the power to fund was
maintained by the legislature.
10:11:57 AM
Ms. Sanders continued to address responses:
8. Provide a breakdown of the pay for the staff that
maintains the roads and highways?
The published salary schedules,
https://doa.alaska.gov/dof/payroll/sal_sched.html
, provides specific wage rates by union,
geographical differential, range, and step. The
maintenance stations throughout the state are
staffed with the job titles and ranges listed in
the table below. Another variation of wages can
include overtime increasing that wage per
employee.
9. Does the right of way clean-up increment include
the dilapidated structures and roads by Mt. Edgecumbe
High School (in Sitka)?
The Department of Transportation and Public
Facilities right-of-way does not operate the
street where Mt. Edgecumbe High School is
located.
The right-of-way one-time-item increment is not
necessarily for Central Region only. The change
record does specify, "The department will focus
on critical areas across the state where
encampments have posed ongoing challenges. A
contracted service approach ensures cost-
effective, specialized work in compliance with
safety and environmental standards. The
contractors will perform site assessments, secure
the necessary permits, and ensure the proper
disposal of waste and hazardous materials."
10:13:08 AM
Co-Chair Stedman said that the Department of Transportation
and Public Facilities did the maintenance at Mt. Edgecumbe.
He noted that the structures were dilapidated. He said that
his office requested that the department provide pictures
of the structures to be scrutinized. He stated that he did
not know of any other buildings in the state that were do
deplorable. He relayed that he would bring an update of the
structures and the clean-up.
10:14:35 AM
Co-Chair Hoffman believed that the students of Mt.
Edgecumbe deserved better than the current status of their
campus.
10:14:55 AM
Ms. Sanders continued to discuss the responses:
10. What is the cost of shutting down the Alaska
Gasline Development Corporation (AGDC), both operating
and capital?
The AGDC's total FY2026 Governor's operating
budget is $5,730.7, of which $2,487.5 is UGF and
$3,243.2 is Other (AGDC-LNG). There are a total
of four permeant full-time UGF for Phase 1 of the
Gasline Project Development.
The AGDC's total FY2026 operating and capital
budgets are $9,930.7, all funds.
In the event the Alaska Liquefied Natural Gas
Pipeline (AK-LNG) project was not continued, AGDC
would use the FY2026 operating budget to shut
down. This would include completing an evaluation
of all leases, permits, and licenses and
providing a report on which items could be
extended or expired, and the cost associated with
any maintenance fees.
11. For the Pilatus, what percentage of maintained
runways is that plane able to land at?
The Pilatus would be able to land at 96 percent
of the 215 maintained runways in Alaska,
including gravel runways.
12. What is the status of the IT class study? What is
the timeline for implementation? Aside from the salary
study, what other class/salary studies are being done?
The IT job class study was conducted by the
Division of Personnel and class specifications
for new and updated IT job classes have been
completed. Some of the updated IT job classes
were used as benchmark jobs in the statewide
salary study. Given the breadth of the IT job
class study and the active statewide salary
study, the administration will consider statewide
salary study findings prior to implementing
changes to the IT job classes.
Job class studies performed by the Division of
Personnel are a routine part of maintaining the
Classification and Pay Plan and may occur when
the job class specifications are outdated because
of extensive reorganization or redistribution of
work, substantial increases or decreases in the
workload, and/or changes in the nature or level
of assignments and responsibilities. Active job
class studies being performed by the Division of
Personnel include: IT study, Park Rangers,
Superintendents, and Specialists; Disability
Adjudicators; Human Rights Field Representatives,
ACFR Accountants; Executive Administrators of the
Board of Architects, Engineers, and Land
Surveyors and the Real Estate Commission;
Community Care Licensing Specialists; and
Vocational Rehabilitation Assistant.
Salary reviews are more limited in scope than a
job class study and may be requested when the
class specification accurately describes the
duties/responsibilities of the job class, but the
agency believes the salary range is not accurate.
Internal salary reviews conducted by the Division
of Personnel are currently on hold pending
completion of the statewide salary study, which
takes external market data into consideration.
10:16:52 AM
Senator Kiehl asked why the IT job study data was being
held until the finalization of the overall salary study.
10:16:54 AM
Ms. Sanders replied that there were specific IT job
classifications that were incorporated into the salary
study and the information was being held to alleviate
duplication of data.
10:17:27 AM
Senator Kiehl asked whether the job study indicated that
all employees were in their correct job class.
Ms. Sanders responded that the department had done a
rebalancing of positions and titles associated with the IT
classes. She said that the final study would individually
identify and analyze where each individual person was and
where they would be in the new classification system.
10:18:14 AM
Senator Kiehl thought that the statewide salary study was
looking at job classes and whether they were appropriately
paid compared to various factors. He understood that the
study was twofold: people who were doing work needed to be
put in the right job classes to be paid for their work, and
the job classes needed to be compared to other systems for
the purposes of hiring and retention. He questioned the
methodology of the current study.
10:19:04 AM
Ms. Sanders said that the approach would be to work through
the implementation of the entirety of both the
classification study and whatever was determined in the
salary study.
Senator Kiehl wondered why the work could not be done in
two phases. He felt that the mega project of combining
the classification and the salary study was questionable.
10:20:30 AM
Ms. Sanders continued to address the responses:
13. Is the AMHS bargaining unit in the salary study?
For the salary study as related to AMHS, the
State Personnel Act (AS 39.25.110 (16)) places
masters and members of the crews of the AMHS
vessels in the exempt service. Accordingly, these
job classes are exempt from the State's
classification and pay plan.
The statewide salary study focused on job classes
in the Executive Branch in the classified and
partially exempt services. The screenshot below
shows ferry system administrative positions in
the classified service that were included as
benchmark jobs for the statewide salary study.
10:21:12 AM
Co-Chair Stedman noted that the state was in competition
with the State of Washington for ferry employees and wanted
Alaska to be competitive when hiring.
10:22:05 AM
Ms. Sanders continued to address responses:
14. Why are there more filled versus budgeted
positions in the Department of Fish and Game (DFG) and
the Department of Natural Resources (DNR)?
In the table and graph on budgeted versus filled full-
time positions provided on slide 15 of the
presentation, the DFG and DNR each showed more filled
than budgeted positions. This was because of how the
data pulled from the IRIS system into the Alaska
Budget System and part-time positions inadvertently
being counted in the full-time total.
The below table and graph correct the filled full-time
information.
10:22:32 AM
Senator Cronk addressed question 3. He surmised that
subsistence was low on the list of priorities for the
administration. He stressed that it was one of his top
priorities. He felt that there was a trend in closures for
subsistence fishermen but not commercial fishing.
10:24:45 AM
Co-Chair Hoffman thought that Senator Cronks concerns were
valid. He thought that the issue could be discussed in
subcommittee and stressed the importance of prioritizing
subsistence fishing over commercial fishing.
10:25:12 AM
Co-Chair Stedman remarked that he was informed that the
entire community of Ketchikan was classified as
subsistence. He noted that he represented the two largest
subsistence communities in the state Ketchikan and Sitka.
Co-Chair Hoffman discussed housekeeping.
ADJOURNMENT
10:26:03 AM
The meeting was adjourned at 10:26 a.m.