Legislature(2025 - 2026)SENATE FINANCE 532

03/03/2025 09:00 AM Senate FINANCE

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Audio Topic
09:00:57 AM Start
09:02:10 AM EO136
09:58:06 AM SSCR1
10:22:09 AM Presentation: Fy 45 Medicaid Enrollment and Spending in Alaska Report (mesa) – Department of Health
10:28:59 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ EO 136 Establish Depart. of Agriculture TELECONFERENCED
Heard & Held-
-- Testimony <Invitation Only> --
+ SSCR 1 DISAPPROVE EO 136 TELECONFERENCED
Moved SSCR 1 Out of Committee
-- Invited & Public Testimony --
Presentation: FY25 - FY45 Medicaid Enrollment
and Spending in Alaska Report (MESA)
Department of Health
Bills Previously Heard/Scheduled
**Streamed live on AKL.tv**
                 SENATE FINANCE COMMITTEE                                                                                       
                       March 3, 2025                                                                                            
                         9:00 a.m.                                                                                              
                                                                                                                                
9:00:57 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair  Hoffman   called  the  Senate   Finance  Committee                                                                    
meeting to order at 9:00 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                                                                                                                  
                                                                                                                                
John Boyle,  Commissioner, Department of  Natural Resources;                                                                    
Brent  Goodrum, Deputy  Commissioner, Department  of Natural                                                                    
Resources;  Liz Harpold,  Staff,  Senator  Donny Olson;  Ted                                                                    
Helvoight, President, Evergreen Economics.                                                                                      
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Dylan  Blankenship,  Self,  Point  Mackenzie;  Bernie  Karl,                                                                    
Farmer, Chena Hot Springs;  Scott Mugrage, President, Alaska                                                                    
Farm  Bureau,  Delta  Junction;  Rachel  Lord,  Alaska  Food                                                                    
Policy  Council,  Homer;  Amy  Seitz,  Alaska  Farm  Bureau,                                                                    
Soldotna; Marshall Trent, Self, Wasilla.                                                                                        
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SSCR 1    DISAPPROVE EO 136                                                                                                     
                                                                                                                                
          SSCR 1 was REPORTED out of committee with one                                                                         
          previously published zero fiscal note: FN                                                                             
          1(SRES).                                                                                                              
                                                                                                                                
EO 136    ESTABLISH DEPARTMENT OF AGRICULTURE                                                                                   
                                                                                                                                
          EO 136 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
PRESENTATION:  FY 45  MEDICAID  ENROLLMENT  and SPENDING  IN                                                                    
ALASKA REPORT (MESA)  DEPARTMENT OF HEALTH                                                                                      
                                                                                                                                
Co-Chair Hoffman discussed the agenda.                                                                                          
                                                                                                                                
EXECUTIVE ORDER 136 - ESTABLISH DEPARTMENT OF AGRICULTURE                                                                       
                                                                                                                                
9:02:10 AM                                                                                                                    
                                                                                                                                
JOHN BOYLE,  COMMISSIONER, DEPARTMENT OF  NATURAL RESOURCES,                                                                    
introduced himself. He relayed that  he would discuss EO 136                                                                    
and  its rationale.  He explained  that the  executive order                                                                    
would splice  the existing Division of  Agriculture from the                                                                    
Department of Natural Resources  (DNR). The division was led                                                                    
by  Director  Bryan Scoresby,  with  a  team of  roughly  37                                                                    
people, nearly  all of  whom were based  out of  Palmer. The                                                                    
division would  form the  nucleus of what  would be  the new                                                                    
Department  of  Agriculture.  A  commissioner  position  and                                                                    
other items  would be added for  functionality. He explained                                                                    
that the  division's current budget would  be transferred to                                                                    
the  department,  on  top  of  which  there  would  be  some                                                                    
incremental costs to get set up.                                                                                                
                                                                                                                                
Commissioner Boyle addressed the  question of why the change                                                                    
was proposed. He described that  when Governor Dunleavy came                                                                    
into  office,  there was  a  period  of  time when  the  new                                                                    
administration was coming  to terms with the  size and scope                                                                    
of the agencies. The period  transitioned into the beginning                                                                    
of  the Covid-19  pandemic. He  conveyed  that the  Covid-19                                                                    
pandemic  had underscored  the importance  of food  security                                                                    
for the state.  He mentioned phone calls  with the governors                                                                    
of Washington and  Oregon to discuss potential  shut down of                                                                    
ports. He  mentioned discussion  of sealed  Canadian borders                                                                    
with no opportunity  for trucking. He described  that as the                                                                    
governor  had contemplated  the consequences  of a  possible                                                                    
supply chain  disruption, he  had understood  the importance                                                                    
of making investments in food security.                                                                                         
                                                                                                                                
Commissioner   Boyle  recounted   that   the  governor   had                                                                    
considered the  best approach and  had created an  Office of                                                                    
Food Security,  which was tasked with  assessing the state's                                                                    
food  systems.   He  noted  that   when  the   governor  had                                                                    
interviewed  him as  commissioner, he  had communicated  the                                                                    
intent to  take agriculture  out of  DNR to  give it  a more                                                                    
prominent  voice in  the  cabinet. The  change  would be  an                                                                    
important  step  to ensure  the  state  maintained its  food                                                                    
security and  increase agricultural  opportunities as  a top                                                                    
priority.                                                                                                                       
                                                                                                                                
9:06:44 AM                                                                                                                    
                                                                                                                                
Commissioner Boyle  continued to address the  genesis of the                                                                    
executive order.  He thought that  agriculture was  an issue                                                                    
that did  not rise to  the table. He thought  the discussion                                                                    
was  timely.  He  mentioned meeting  with  members  in  both                                                                    
bodies and  being struck by  hearing the different  foci and                                                                    
priorities. He mentioned education as  a large piece of work                                                                    
for the current  session. He thought the  committee was well                                                                    
aware that there was a  fiscally constrained environment and                                                                    
thought there was a tendency  to focus on the most pertinent                                                                    
issues  while  setting  topics like  agriculture  aside.  He                                                                    
thought the topics of food  security and increasing economic                                                                    
opportunities  in the  state were  worthy  of attention  and                                                                    
consideration. He  pondered what could  be done to  grow the                                                                    
state's  economic  condition,  create new  jobs,  make  more                                                                    
productive use  of the state's  land and water,  and enhance                                                                    
food security. He encouraged members to keep an open mind.                                                                      
                                                                                                                                
Commissioner Boyle discussed  opportunities for agriculture.                                                                    
He characterized  the state  as "relatively  food insecure."                                                                    
He  cited that  when  Alaska was  a  territory, it  produced                                                                    
almost 50 percent of the  amount of food consumed. The self-                                                                    
reliance  had  decreased, and  he  estimated  that around  5                                                                    
percent of the state's dietary  needs were provided by local                                                                    
sources. He thought there was  a passionate group of farmers                                                                    
and mariculturists  that were utilizing  the land,  sea, and                                                                    
technology  to  grow  food  and  sundries.  He  thought  the                                                                    
products  were  very  good. He  mentioned  locally  produced                                                                    
carrots  in Palmer.  He mentioned  milk  produced by  Alaska                                                                    
Range Dairy. He mentioned  the Juneau business Juneau Greens                                                                    
that produced greens and had a superior product.                                                                                
                                                                                                                                
9:11:02 AM                                                                                                                    
                                                                                                                                
Commissioner  Boyle thought  people  were  committed to  the                                                                    
cause of agriculture. He thought  with strategic vision from                                                                    
the  state,   there  was  an  opportunity   to  advance  the                                                                    
endeavor.  He  mentioned   working  with  federal  partners,                                                                    
universities,  the Farm  Bureau,  and local  soil and  water                                                                    
conservation  districts. He  mused  that  there were  macro-                                                                    
factors  that   made  the   state  uniquely   positioned  to                                                                    
capitalize  on   the  opportunities  with   agriculture.  He                                                                    
mentioned  a lengthened  growing season  and described  warm                                                                    
temperatures  in  Anchorage  and more  frost-free  days.  He                                                                    
thought growing  seasons were lengthening across  the state.                                                                    
He considered that  adding four days a week  onto either end                                                                    
of the  growing season could make  a considerable difference                                                                    
in what was  feasible to be grown. He mentioned  a farmer in                                                                    
Nenana that was  growing sweet corn, which  he considered to                                                                    
be a large change.                                                                                                              
                                                                                                                                
Commissioner Boyle  mentioned the  state's large  land base,                                                                    
compared  to  other  states  with  agricultural  land  being                                                                    
repurposed. He cited  that Alaska was the only  state in the                                                                    
country  that  had  the  opportunity  to  create  additional                                                                    
agricultural land.                                                                                                              
                                                                                                                                
9:14:03 AM                                                                                                                    
                                                                                                                                
Commissioner  Boyle mentioned  agri-tourism and  exports. He                                                                    
mentioned peony farms  in the state. He  reiterated that the                                                                    
state   had   incredible   opportunities   and   competitive                                                                    
advantages in certain areas. He  relayed that the department                                                                    
had worked with  the governor's office to  create a proposal                                                                    
that  was   fiscally  responsible  that  utilized   as  many                                                                    
existing resources  as possible. He believed  that by taking                                                                    
advantage of  the opportunity while  there was  a supportive                                                                    
governor and commissioner, the state  would see great things                                                                    
happening in the state's agricultural sector in the future.                                                                     
                                                                                                                                
Co-Chair  Hoffman relayed  that  he represented  an area  in                                                                    
Western Alaska  that was close to  the size of the  state of                                                                    
Washington, which  had about 30,000 residents.  He described                                                                    
that the  district was roadless,  with communities  that may                                                                    
not have  plane service for a  week at a time.  He mentioned                                                                    
Adak.  He thought  if there  was any  district in  the state                                                                    
that was  aware of  food security, his  district was  a good                                                                    
example.  He  thought  the  cost  of  living  was  a  higher                                                                    
priority  for  his  constituents. He  pondered  spending  60                                                                    
percent  of a  person's income  on heating.  He agreed  that                                                                    
food security was  an issue. He mentioned  other issues such                                                                    
as  education.  He  emphasized  that  a  continued  balanced                                                                    
budget  was the  issue at  hand. He  thought the  public and                                                                    
members  realized  that the  state  was  in a  situation  of                                                                    
needing to address the budget.                                                                                                  
                                                                                                                                
9:18:41 AM                                                                                                                    
                                                                                                                                
BRENT  GOODRUM, DEPUTY  COMMISSIONER, DEPARTMENT  OF NATURAL                                                                    
RESOURCES,  discussed  a  presentation  entitled  "Executive                                                                    
Order  136 -  Establishing  the  Department of  Agriculture"                                                                    
(copy on file).                                                                                                                 
                                                                                                                                
Mr. Goodrum  looked at slide 2,  "Alaska Agriculture: Status                                                                    
Report                                                                                                                          
                                                                                                                                
     • Robust Alaska agriculture is a long-held vision                                                                          
     • Hardy Alaskans are farming                                                                                               
          • 2022 national census: 1,173 Alaska farms and                                                                        
          ranches produced about $39.7 million in crop                                                                          
          value and $51.2 million in animal production                                                                          
     • So much more potential  with dedicated, focused,                                                                         
     expert support                                                                                                             
     • Why grow agriculture?                                                                                                    
          • Greater food security and independence for                                                                          
          Alaskans                                                                                                              
          • Further develop an important economic sector                                                                        
          (jobs, value chain benefits)                                                                                          
                                                                                                                                
Mr. Goodrum commented that  the governor's overarching goals                                                                    
for  the  executive  order  were to  continue  to  grow  the                                                                    
state's   agricultural  base,   improve  the   state's  food                                                                    
security,  and  further  develop  the  state's  agricultural                                                                    
economic  sector.  He  pointed   out  that  agriculture  was                                                                    
featured  on   the  state  seal.   He  recounted   that  the                                                                    
territorial  government  had  established  a  Department  of                                                                    
Agriculture in  1945, before being  wrapped into  DNR around                                                                    
the time  of statehood.  He referenced tenuous  supply lines                                                                    
and thought the state's economy needed to be diversified.                                                                       
                                                                                                                                
9:21:05 AM                                                                                                                    
                                                                                                                                
Mr. Goodrum spoke to slide 3, "Executive Order 136                                                                              
                                                                                                                                
    • Establishes the Alaska Department of Agriculture                                                                          
     • Transitions in full the Division of Agriculture from                                                                     
     the Department of Natural Resources (DNR) to the new                                                                       
     department                                                                                                                 
          • Statutory responsibilities, functions, do not                                                                       
          change                                                                                                                
     • Provides transitionary measures for seamless                                                                             
     reorganization                                                                                                             
     • Effective July 1, 2025                                                                                                   
                                                                                                                                
Mr. Goodrum relayed  that no new programs  or measures would                                                                    
be added to the new proposed department.                                                                                        
                                                                                                                                
Mr. Goodrum referenced slide 4, "Vision                                                                                         
                                                                                                                                
    • Establishes the Alaska Department of Agriculture                                                                          
     • Transitions in full the  Division of Agriculture from                                                                    
     the Department  of Natural Resources  (DNR) to  the new                                                                    
     department                                                                                                                 
          • Statutory responsibilities, functions, do not                                                                       
          change                                                                                                                
     •   Provides   transitionary  measures   for   seamless                                                                    
     reorganization                                                                                                             
     • Effective July 1, 2025                                                                                                   
                                                                                                                                
Mr.  Goodrum  turned  to  slide  5,  "Improved  results  for                                                                    
Alaskans":                                                                                                                      
                                                                                                                                
     •  Governor's  overarching   goal:  increase  focus  on                                                                    
     agriculture   and  food   security  with   a  dedicated                                                                    
     department and leadership                                                                                                  
     •  Focus  will help  develop  a  robust, durable  state                                                                    
     agricultural  policy, including  a strategic  plan with                                                                    
     an implementation roadmap                                                                                                  
     •   Continuation   of   the   Governor's   budget   and                                                                    
     legislative  policy  actions   following  the  COVID-19                                                                    
     pandemic to enhance food security in Alaska                                                                                
     • Aligns  with top  recommendations of task  forces and                                                                    
     stakeholders                                                                                                               
     •  New  department  is  first  step  to  provide  solid                                                                    
     foundation for future growth                                                                                               
                                                                                                                                
Mr. Goodrum mentioned the governor's  2002 Food Security and                                                                    
Independence Task  Force; and the legislature's  Alaska Food                                                                    
Strategy Task Force [created by HB 298 in 2022].                                                                                
                                                                                                                                
Mr. Goodrum  mentioned the  opportunity for  more consistent                                                                    
and  proactive interaction  with  federal  partners and  the                                                                    
state's  Congressional delegation,  which  he thought  would                                                                    
lead to  better resources for  the state. He noted  that the                                                                    
U.S. Department  of Agriculture was  a major  contributor to                                                                    
the   agricultural   sector.   He  thought   many   in   the                                                                    
agricultural  sector had  wanted  a seat  at  the table.  He                                                                    
contended  that  the  new Department  of  Agriculture  would                                                                    
afford  greater  legislative  focus  and  attention  on  the                                                                    
department's resources  and metrics, as well  as its mission                                                                    
and progress.                                                                                                                   
                                                                                                                                
9:24:56 AM                                                                                                                    
                                                                                                                                
Mr.  Goodrum  considered  slide 6,  "Today's  Department  of                                                                    
Natural Resources                                                                                                               
                                                                                                                                
     • 1,054 employees (767 PFT, 215 PPT, 72 NP) across                                                                         
     seven divisions, two offices                                                                                               
     • Led by commissioner supported by two deputies                                                                            
     • Statewide offices, programs and sites                                                                                    
     • FY2025 Management Plan budget (all funds):                                                                               
     $173,399.3                                                                                                                 
     • DNR returns $21 to the state treasury for every UGF                                                                      
     dollar appropriated                                                                                                        
                                                                                                                                
Mr.  Goodrum   displayed  slide  7,  "Today's   Division  of                                                                    
Agriculture":                                                                                                                   
                                                                                                                                
     • Division director                                                                                                        
     • Programs separated into Agriculture Development                                                                          
     and Plant Materials Center sections                                                                                        
     • Employees: 37 total (32 PFT and 5 PPT)                                                                                   
     • FY2025 Management Plan: $7,176.2 all funds                                                                               
     • Headquarters in Palmer                                                                                                   
                                                                                                                                
Mr. Goodrum noted that the  Divion of Agriculture's Director                                                                    
was  Bryan Scoresby.  He  cited  that agriculture's  returns                                                                    
would  not necessarily  come to  the  state's treasury;  but                                                                    
would  diversify the  state's  economy,  bring more  healthy                                                                    
food, and enhance food security.                                                                                                
                                                                                                                                
Mr.  Goodrum  highlighted  slide  8,  "Today's  Division  of                                                                    
Agriculture":                                                                                                                   
                                                                                                                                
     • Inspections, certifications                                                                                              
     • Farm, production loans through Agricultural                                                                              
     Revolving Loan Fund                                                                                                        
     • Alaska Grown and other promotion (state, national,                                                                       
     international)                                                                                                             
     • Agricultural land sales / leases support                                                                                 
     • Administers federal grants to Alaskans                                                                                   
     • Future Farmers of America                                                                                                
     • Seed storage and production, varietal trials                                                                             
     • Seed cleaning services rendered                                                                                          
     • Revegetation and erosion control consulting                                                                              
     • Industrial hemp regulation                                                                                               
     • Invasive plant, pest management                                                                                          
                                                                                                                                
Mr.   Goodrum  highlighted   that   the  division   annually                                                                    
inspected about  $100 million in agricultural  products. The                                                                    
Board of  Agriculture and Conservation issued  loans and had                                                                    
about a $21.5  million equity with greater than  60 loans in                                                                    
play.  The  division  administered   about  $10  million  in                                                                    
grants.  There  were  about 450  students  participating  in                                                                    
Future Farmers of America.                                                                                                      
                                                                                                                                
Mr.  Goodrum looked  at slide  9, "Tomorrow's  Department of                                                                    
Agriculture":                                                                                                                   
                                                                                                                                
     • Responsible but simple leadership, organizational                                                                        
     structure                                                                                                                  
     • Primed for build-out over time with increased                                                                            
     programming, responsibilities                                                                                              
     • Employees: 50 total (45 permanent full-time and five                                                                     
     permanent part-time)                                                                                                       
     • FY2026 increment: $2,734.4 unrestricted general fund                                                                     
     • Headquarters in Palmer or Anchorage                                                                                      
                                                                                                                                
Mr.  Goodrum  spoke  to  the  flow  chart  on  slide  9.  He                                                                    
considered that  with added responsibilities over  time, the                                                                    
structure could adapt to accommodate.                                                                                           
                                                                                                                                
9:29:07 AM                                                                                                                    
                                                                                                                                
Mr.  Goodrum  addressed  slide 10,  "Department  Structure,"                                                                    
which showed  a table  that depicted  the new  department as                                                                    
presented to  the House and  Senate Resource  Committees and                                                                    
supported  by  a request  of  $2.7  million in  Unrestricted                                                                    
General  Funds  (UGF)  in   the  governor's  amended  budget                                                                    
submitted to the legislature two  weeks previously. He noted                                                                    
that  based on  many conversations  with legislators  and in                                                                    
respect to the state's  fiscal situation, the administration                                                                    
had  revisited  all options  to  resource  the new  proposed                                                                    
department and would be submitting  an amendment to the $2.7                                                                    
million  request.  The  amendment  would  reflect  what  was                                                                    
developed as a "cost neutral" department.                                                                                       
                                                                                                                                
Mr.  Goodrum  continued  that instead  of  creating  13  new                                                                    
positions,  the  amendment   proposed  to  reclassify  three                                                                    
positions  within  the  current division  and  transfer  two                                                                    
positions  and funding  from within  DNR. Additionally,  the                                                                    
new  department  would  absorb  any  costs  related  to  the                                                                    
reclassifications.                                                                                                              
                                                                                                                                
Co-Chair  Hoffman  asked  if  there was  a  time  frame  for                                                                    
submission of the amendment.                                                                                                    
                                                                                                                                
Mr.  Goodrum  relayed  that the  Office  of  Management  and                                                                    
Budget (OMB)  was working on  the amendment and it  would be                                                                    
forthcoming.  He relayed  that the  administration was  very                                                                    
mindful of the legislature's timeline.                                                                                          
                                                                                                                                
Mr. Goodrum  advanced to slide 11,  "Reclassifications," and                                                                    
noted  that the  specific  reclassifications  listed on  the                                                                    
slide would also not occur.                                                                                                     
                                                                                                                                
Mr. Goodrum  looked at slide  12, "Costs  Comparison," which                                                                    
showed a  table with  a cost comparison  of the  Division of                                                                    
Agriculture's current FY  25 management plan with  the FY 26                                                                    
governor's  budget. He  reiterated  that there  would be  no                                                                    
additional UGF  request or 13  new positions to  support the                                                                    
executive order,  which was a  significant change  from what                                                                    
was presented  in the resources  committees. The  slide also                                                                    
showed was also  a FY 26 request of $2.2  million in federal                                                                    
receipt  authority for  microgrants  for  food security.  He                                                                    
noted   that  there   would  be   two  full-time   positions                                                                    
transferred from DNR.                                                                                                           
                                                                                                                                
Mr.  Goodrum showed  slide 13,  "Timeline,"  which showed  a                                                                    
graphical flow  chart associated  with the  executive order.                                                                    
On January 1,  2025, the EO was  introduced. The legislature                                                                    
had 60 days to disapprove  the order, and if not disapproved                                                                    
by March  22, the implementation  of the EO would  begin and                                                                    
on  July  1, 2025,  a  Department  of Agriculture  would  be                                                                    
established.                                                                                                                    
                                                                                                                                
Mr.   Goodrum   referenced   slide  14,   "Transition   work                                                                    
includes,"  which showed  a  list  of activities  associated                                                                    
with transition  planning. He  noted that  the list  was not                                                                    
exhaustive.                                                                                                                     
                                                                                                                                
Mr. Goodrum offered to provide a Sectional Analysis.                                                                            
                                                                                                                                
Co-Chair Hoffman answered "no."                                                                                                 
                                                                                                                                
9:33:03 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:33:56 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Hoffman asked if the  members had any questions for                                                                    
the commissioner.                                                                                                               
                                                                                                                                
Senator  Cronk noted  that  he had  not  seen anything  that                                                                    
pertained  to  forestry.  He  asked  Commissioner  Boyle  to                                                                    
comment.                                                                                                                        
                                                                                                                                
Commissioner  Boyle relayed  that  it  was not  contemplated                                                                    
that  the Division  of Forestry  and  Fire Protection  would                                                                    
move over to  the proposed department. He  reasoned that the                                                                    
state  continued  to  focus on  building  out  its  forestry                                                                    
division and  ensuring it  was responsible  to the  needs of                                                                    
the  industry.  He   mentioned  that  wildland  firefighting                                                                    
management,  forestry decisions,  and other  land management                                                                    
decisions associated  with forestry would remain  in DNR and                                                                    
be well-attended.                                                                                                               
                                                                                                                                
9:35:34 AM                                                                                                                    
                                                                                                                                
Senator Kiehl asked the commissioner  to address how aquatic                                                                    
farming would be rolled into  the new department. He relayed                                                                    
that he had not noticed a mention of mariculture.                                                                               
                                                                                                                                
Commissioner Boyle  conveyed that mariculture  was regulated                                                                    
by  myriad agencies,  and  DNR was  involved  in leasing  of                                                                    
state  tidelands   or  near-shore   areas.  He   noted  that                                                                    
Department of  Environmental Conservation played a  role, as                                                                    
did the Department  of Fish and Game.  The current structure                                                                    
of the proposed department  would not include the functions.                                                                    
He noted that  it had been repeatedly discussed  in the food                                                                    
task forces  that mariculture was important.  He thought the                                                                    
intent  was  to   get  the  framework  built   for  the  new                                                                    
department before  considering other functions  that existed                                                                    
across  different   departments.  He  mentioned   the  state                                                                    
veterinarian as an example.                                                                                                     
                                                                                                                                
Commissioner Boyle continued that  there may be functions of                                                                    
other  departments  that  could  be  spliced  into  the  new                                                                    
department, if  there was  consensus that  centralizing some                                                                    
of the  functions made sense. He  mentioned herbicides, herd                                                                    
health,  and mariculture.  He  thought  it was  contemplated                                                                    
that  the new  commissioner  would have  the opportunity  to                                                                    
strategically   look  at   the   work   and  consider   what                                                                    
functionality  could  be  usefully transferred  to  the  new                                                                    
department.  He summarized  that mariculture  would stay  in                                                                    
DNR, but he  could envision it moving to  the new department                                                                    
at some point in the future.                                                                                                    
                                                                                                                                
9:39:01 AM                                                                                                                    
                                                                                                                                
Senator  Kiehl  appreciated  hearing   the  vision  for  the                                                                    
executive order.  He thought  it sounded  like the  plan was                                                                    
still  forming. He  asked the  commissioner  to discuss  the                                                                    
anticipated   spending   for   the   mechanical   parts   of                                                                    
potentially separating  into two departments. He  noted that                                                                    
the Department  of Family and  Community Services  was still                                                                    
several years from finishing its  split. He noted that there                                                                    
had been up  front costs and currently  there were full-time                                                                    
positions   that  continued   to  work   on  splitting   the                                                                    
departments.                                                                                                                    
                                                                                                                                
Commissioner  Boyle   believed  that  the  costs   would  be                                                                    
extremely  minimal. The  plan was  to completely  splice out                                                                    
the Division of Agriculture. He  noted that the division was                                                                    
currently physically  housed in two locations  in Palmer. He                                                                    
relayed  that  there  would not  be  costs  associated  with                                                                    
moving  people or  setting up  new  offices. He  generalized                                                                    
that there  would be no costs  associated with a lot  of the                                                                    
logistical challenges  of setting  up a new  department. The                                                                    
equipment and  existing internet technology (IT)  would stay                                                                    
the same. Some  of the new positions  that were contemplated                                                                    
would involve  cost. He  considered that  the administration                                                                    
would be shifting  PCNs around to make the  change as budget                                                                    
neutral as possible.  He thought there would be  a period of                                                                    
transition,   assuming   that   the  legislature   did   not                                                                    
disapprove the  EO. He did  not see the change  as something                                                                    
that would continue indefinitely.                                                                                               
                                                                                                                                
Commissioner  Boyle pondered  that once  a new  commissioner                                                                    
was hired, the individual would  need time and space to take                                                                    
a  strategic hard  look at  what  the state  was doing  with                                                                    
agriculture to  come up with a  fulsome plan to fit  in with                                                                    
the state  budget and be  able to  articulate a plan  to the                                                                    
legislature.                                                                                                                    
                                                                                                                                
9:43:27 AM                                                                                                                    
                                                                                                                                
Senator Kiehl appreciated  Commissioner Boyle's response. He                                                                    
thought that along  with many of his  colleagues, he thought                                                                    
the state needed  to grow and produce more of  its own food.                                                                    
He did  not know that the  state had a plan  yet and thought                                                                    
the difficulty of an executive  order versus a bill was that                                                                    
it required action rather than having time for planning.                                                                        
                                                                                                                                
Co-Chair  Stedman followed  up to  Senator Kiehl's  comments                                                                    
and asked  why the  proposed change was  not submitted  as a                                                                    
bill to  go through  the normal process  when the  state was                                                                    
struggling  with a  multi-million-dollar  deficit. He  asked                                                                    
how to rectify  the situation with a balanced  budget in the                                                                    
given time frame.                                                                                                               
                                                                                                                                
Commissioner  Boyle  noted   that  the  Alaska  Constitution                                                                    
empowered  the   governor  to  make  such   changes  in  the                                                                    
structure  of the  administration through  executive orders.                                                                    
He appreciated  that while the  legislature would  prefer to                                                                    
have a  bill, and that  bills coincided with the  process of                                                                    
formulating budgets  and ultimately receiving  consensus. He                                                                    
thought  the  governor  wanted  to  ensure  the  legislature                                                                    
understood  the  importance  of the  proposal,  rather  than                                                                    
having  it bandied  about  or  put on  a  backburner as  the                                                                    
legislature took up other  considerations. He reflected that                                                                    
it was  the waning two  years of the administration  and the                                                                    
governor wanted  to have the  discussion now  to potentially                                                                    
start to effectuate  the new department as early  as the end                                                                    
of the month.                                                                                                                   
                                                                                                                                
9:46:28 AM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman  reminded the  commissioner and  the public                                                                    
that the constitution also required  the legislature to pass                                                                    
a balanced budget.  He thought a piece  of legislation would                                                                    
have  been  a  better  way to  proceed  and  reflected  upon                                                                    
questions  that   Senator  Kiehl   had  posed.   He  thought                                                                    
governors  had  tremendous  power,  more so  than  in  other                                                                    
states, and for the legislature  to ignore the power and his                                                                    
priorities would be a mistake.                                                                                                  
                                                                                                                                
Commissioner  Boyle  thanked  the  committee  and  expressed                                                                    
appreciation for  the questions. He knew  that the questions                                                                    
came  from  a  position  of  thoughtfulness.  He  referenced                                                                    
Deputy   Commissioner   Goodrum's  comment   regarding   the                                                                    
administration  hearing the  legislature's concern  with the                                                                    
budget.  He  thought  when  OMB was  done  with  its  budget                                                                    
review,  the   administration  would  not  be   looking  for                                                                    
significant funds  to start the new  proposed department. He                                                                    
mentioned  the inevitable  expansion  of agencies'  budgets,                                                                    
thought that having a commissioner  to be accountable to the                                                                    
legislature  was an  important  element to  ensure that  the                                                                    
state's  agricultural  policies  were well  vetted  and  its                                                                    
financial resources were well stewarded.                                                                                        
                                                                                                                                
9:50:49 AM                                                                                                                    
                                                                                                                                
Commissioner Boyle  reflected on Co-Chair  Hoffman's comment                                                                    
regarding   the   cost  of   energy   as   related  to   the                                                                    
sustainability  of   Alaska's  communities.   He  referenced                                                                    
living in  rural Alaska and  spending considerable  funds on                                                                    
heating  and  produce. He  agreed  that  for agriculture  to                                                                    
succeed  in  the  state,  energy  costs  would  need  to  be                                                                    
addressed. He  expressed optimism and believed  there was an                                                                    
opportunity to make progress on  Alaska's Liquid Natural Gas                                                                    
(AK LNG) Project.  He mentioned coal, wind,  solar, and more                                                                    
conventional  energy sources;  and thought  the state  would                                                                    
resolve its energy challenges.                                                                                                  
                                                                                                                                
Commissioner mentioned  the example of Juneau  Greens, which                                                                    
was  enabled through  relatively  affordable energy  through                                                                    
hydropower. He  thought similar solutions in  other parts of                                                                    
the state  would enable more  produce to get to  other parts                                                                    
of the  state. He saw  the topics of energy  and agriculture                                                                    
to be related.  He thought the state would  make progress in                                                                    
lowering the cost of energy.                                                                                                    
                                                                                                                                
9:54:45 AM                                                                                                                    
                                                                                                                                
Commissioner Boyle  mentioned Senator  Cronk and  noted that                                                                    
Tok used biomass  and was able to produce  over 4,000 pounds                                                                    
of  fresh  produce  for  the school  using  waste  heat  and                                                                    
emissions. He considered  multiple Interior communities such                                                                    
as  Galena and  Nenana,  where there  were opportunities  to                                                                    
install biomass  and become more food  secure. He reiterated                                                                    
that  there  were interrelated  issues.  He  thought as  the                                                                    
state worked  towards energy solutions, there  would be more                                                                    
agriculture opportunities.                                                                                                      
                                                                                                                                
Co-Chair Hoffman  emphasized the  need to work  together. He                                                                    
thought  everyone was  aware that  the relationship  between                                                                    
the legislature  and the executive branch  had wavered since                                                                    
the   previous   year.   He  wanted   to   work   with   the                                                                    
administration on food security  and energy. He commented on                                                                    
the  two years  remaining  to accomplish  work. He  stressed                                                                    
that the  work could not  happen if the legislature  did not                                                                    
have a  working relationship with the  governor's office. He                                                                    
relayed that  the committee would  proceed with  the current                                                                    
resolution  and was  eager to  receive  the modified  fiscal                                                                    
note.  He  stated  that  most   importantly,  the  lines  of                                                                    
communication needed to be kept  open to try and establish a                                                                    
better working  relationship between  the committee  and the                                                                    
governor to work on common issues.                                                                                              
                                                                                                                                
EO  136  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
9:57:07 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:57:42 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE SPECIAL CONCURRENT RESOLUTION NO. 1                                                                                    
                                                                                                                                
     Disapproving Executive Order No. 136.                                                                                      
                                                                                                                                
9:58:06 AM                                                                                                                    
                                                                                                                                
LIZ HARPOLD,  STAFF, SENATOR DONNY OLSON,  addressed SSCR 1.                                                                    
She explained that SSCR 1  was a resolution to disapprove EO                                                                    
136,  the  governor's proposal  to  create  a Department  of                                                                    
Agriculture.  The  resolution  noted the  authority  of  the                                                                    
governor to create a department  through executive order and                                                                    
also outlined how the legislature  had 60 days to disapprove                                                                    
an executive order in resolution  taken up in joint session.                                                                    
She  made a  procedural  note that  hearing  and moving  the                                                                    
resolution in committee as not  a reflection of any member's                                                                    
intent  to  vote for  or  against  the resolution  in  joint                                                                    
session at a later time.                                                                                                        
                                                                                                                                
9:59:13 AM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman OPENED public testimony.                                                                                       
                                                                                                                                
9:59:48 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
10:00:16 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
DYLAN    BLANKENSHIP,    SELF,    POINT    MACKENZIE    (via                                                                    
teleconference), testified in opposition  to SSCR 1. He grew                                                                    
hay to feed  livestock in his region. He  mentioned the 2022                                                                    
United States  Census, which indicated that  Alaska was only                                                                    
one of five states that gained  farms as it was losing them.                                                                    
He mentioned many farms for sale  in his area. He cited that                                                                    
the average  age of an Alaskan  farmer was 58 years  old. He                                                                    
mentioned  the  Agricultural  Revolving Loan  Fund,  through                                                                    
which he had purchased his  farm. He was concerned about the                                                                    
viability of  funds and his future  financing opportunities.                                                                    
He  discussed food  security  and the  support  he had  been                                                                    
given  by  the Division  of  Agriculture.  He was  concerned                                                                    
about the  future of farming  in the  state and the  lack of                                                                    
support for farmers.                                                                                                            
                                                                                                                                
10:03:10 AM                                                                                                                   
                                                                                                                                
BERNIE    KARL,    FARMER,    CHENA   HOT    SPRINGS    (via                                                                    
teleconference), spoke in opposition  to SSCR 1. He believed                                                                    
that the only two ways  to create wealth was through growing                                                                    
or mining.  He thought  Alaska had the  ability to  grow and                                                                    
even  export  food.  He discussed  food  production  in  the                                                                    
Netherlands.  He  referenced   Co-Chair  Hoffman's  comments                                                                    
about rural  Alaska. He discussed  the need  for greenhouses                                                                    
in every community to take  advantage of power. He discussed                                                                    
the use  of power and  greenhouses in Chena Hot  Springs. He                                                                    
referenced  greenhouses  in  Bethel and  mentioned  Alaska's                                                                    
long growing season. He emphasized  that agriculture was the                                                                    
future.  He thought  the state's  founding fathers  knew the                                                                    
importance of agriculture.  He had been in the  state for 50                                                                    
years.                                                                                                                          
                                                                                                                                
10:06:48 AM                                                                                                                   
                                                                                                                                
SCOTT   MUGRAGE,  PRESIDENT,   ALASKA  FARM   BUREAU,  DELTA                                                                    
JUNCTION (via  teleconference), spoke  in opposition  to the                                                                    
resolution. He  was a farmer  and rancher and  was President                                                                    
of the Alaska  Farm Bureau. He relayed that  the Alaska Farm                                                                    
Bureau  strongly  supported  EO  136.  He  acknowledged  the                                                                    
concerns  related to  growth in  government. He  thought the                                                                    
industry had  huge potential. He  referenced recommendations                                                                    
from the task forces and  emphasized the need for consistent                                                                    
support for agriculture through different administrations.                                                                      
                                                                                                                                
10:08:52 AM                                                                                                                   
                                                                                                                                
RACHEL  LORD,   ALASKA  FOOD  POLICY  COUNCIL,   HOMER  (via                                                                    
teleconference),  testified in  opposition  to  SSCR 1.  She                                                                    
shared  that   the  Alaska  Food  Policy   Council  strongly                                                                    
supported   the   establishment   of   the   Department   of                                                                    
Agriculture.  She  expressed  support for  the  Division  of                                                                    
Agriculture and  Commissioner Boyle. She continued  that her                                                                    
organization  worked closely  with many  stakeholders across                                                                    
the state and  thought for the development  of stronger more                                                                    
sustained agricultural sector there  needed to be high-level                                                                    
focus  and  collaboration.   She  reiterated  Mr.  Mugrage's                                                                    
remarks regarding the task force recommendations.                                                                               
                                                                                                                                
10:10:48 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:10:57 AM                                                                                                                   
RECONVNEED                                                                                                                      
                                                                                                                                
AMY    SEITZ,   ALASKA    FARM    BUREAU,   SOLDOTNA    (via                                                                    
teleconference), spoke in opposition  to SSCR 1. She relayed                                                                    
she  was  a  third-generation   farmer  that  lived  on  the                                                                    
property  her grandparents  started  in  1948. She  conveyed                                                                    
that  the Alaska  Farm Bureau  was in  strong support  of EO                                                                    
136. She  wanted agriculture to  have stronger voice  in the                                                                    
state. She contended that agriculture  was not a priority of                                                                    
DNR, and that  having a cabinet level seat  would bring more                                                                    
focus to what was needed  and for building relationships for                                                                    
markets. She  considered timing and pondered  that the state                                                                    
currently  had momentum  and potential  in agriculture.  She                                                                    
cited  increased numbers  of farms  and local  products. She                                                                    
mentioned the  peony industry and the  rise of agri-tourism.                                                                    
She thought the new  department would increase food security                                                                    
and build a strong agriculture industry.                                                                                        
                                                                                                                                
10:14:56 AM                                                                                                                   
                                                                                                                                
MARSHALL   TRENT,   SELF,  WASILLA   (via   teleconference),                                                                    
testified  against   SSCR  1.  He  advocated   for  the  new                                                                    
department and  the strategic development of  agriculture in                                                                    
the  state.  He  considered   that  a  deliberate  state-led                                                                    
approach   was  needed,   with   coordinated  policies   and                                                                    
resources. He discussed the slim  margins in agriculture and                                                                    
discussed    agricultural   loans.    He   discussed    loan                                                                    
limitations.  He referenced  Mr.  Blankenship's remarks.  He                                                                    
emphasized the  need for a long-term  strategic approach. He                                                                    
mentioned  federal  loan  guarantees.  He  requested  urgent                                                                    
action and permanent investment capital.                                                                                        
                                                                                                                                
10:18:43 AM                                                                                                                   
                                                                                                                                
Co-Chair Hoffman CLOSED public testimony.                                                                                       
                                                                                                                                
Co-Chair Stedman  MOVED to  report SSCR  1 out  of Committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
note. He noted that the action  did not reflect an intent by                                                                    
any member  to vote  for or  against the  special concurrent                                                                    
resolution  disapproving   Executive  Order  136   in  joint                                                                    
session. There being NO OBJECTION, it was so ordered.                                                                           
                                                                                                                                
Co-Chair Hoffman reiterated  that there was work  to be done                                                                    
with the  current administration.  He thought  questions had                                                                    
arisen regarding  the implementation  of EO 136.  He relayed                                                                    
that  the committee  would go  forward  and continue  dialog                                                                    
with the administration.                                                                                                        
                                                                                                                                
SSCR 1  was REPORTED  out of  committee with  one previously                                                                    
published zero fiscal note: FN 1(SRES).                                                                                         
                                                                                                                                
10:20:20 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:21:32 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
^PRESENTATION:  FY 45  MEDICAID ENROLLMENT  and SPENDING  IN                                                                  
ALASKA REPORT (MESA)  DEPARTMENT OF HEALTH                                                                                    
                                                                                                                                
10:22:09 AM                                                                                                                   
                                                                                                                                
TED HELVOIGHT,  PRESIDENT, EVERGREEN ECONOMICS,  discussed a                                                                    
presentation  entitled  "MESA   FY2025     FY2045  Long-Term                                                                    
Forecast  of  Medicaid  Enrollment and  Spending  in  Alaska                                                                    
March 3, 2025" (copy on file).                                                                                                  
                                                                                                                                
Mr.  Helvoight  looked  at   slide  2,  "Long-Term  Medicaid                                                                    
Forecast ('MESA')                                                                                                               
                                                                                                                                
     • Requested by the Alaska Legislature in 2005                                                                              
     • First forecast completed in 2006                                                                                         
     • 20-year projection updated annually                                                                                      
     • Assumes current Medicaid structure remains in place                                                                      
       Provides a baseline for analysis of proposed                                                                             
     initiatives                                                                                                                
     • Provides insights into trends in AK population,                                                                          
     Medicaid enrollment, utilization, reimbursement rates,                                                                     
     and spending                                                                                                               
                                                                                                                                
Co-Chair Hoffman handed the gavel to Co-Chair Stedman.                                                                          
                                                                                                                                
10:24:14 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:27:50 AM                                                                                                                   
RECONENVED                                                                                                                      
                                                                                                                                
Co-Chair Stedman relayed that there had been an issue with                                                                      
the presentation, and the committee would consider the                                                                          
topic at Wednesday's meeting.                                                                                                   
                                                                                                                                
Co-Chair Stedman discussed the agenda for the upcoming                                                                          
meeting.                                                                                                                        
                                                                                                                                
ADJOURNMENT                                                                                                                   
10:28:59 AM                                                                                                                   
                                                                                                                                
The meeting was adjourned at 10:28 a.m.                                                                                         
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
EO 136 Dept of Ag Statement of Cost 02.11.25.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136 Garrett Testimony Input regarding State budget.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136 Dept of Agriculture DNR presentation 3.3.2025.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136 Kodiak Co-op Support for Dept of Ag 2-10-24.01d.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136 Wilson Testimony Department of AG.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136-Support-AK Farm Bureau 2.18.25.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136-Support-AK Food Policy Council 2-17-2025.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO136 Mott Testimony Alaskan Agriculture.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136 Hastings Please Support Executive Order 136_ Establishment of Department of Agriculture.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
EO 136 Testimony Van Den Berg Department of Agriculture.pdf SFIN 3/3/2025 9:00:00 AM
EO 136
SSCR Allmeroth Public Testimony in Support of SSCR 1.pdf SFIN 3/3/2025 9:00:00 AM
SSCR 1
SCCR1 Public Testimony Allmeroth.pdf SFIN 3/3/2025 9:00:00 AM
SSCR 1
AO 136 Department of AG Comments.pdf SFIN 3/3/2025 9:00:00 AM
EO 136