HOUSE BILL NO. 48 "An Act relating to appropriations to the civil legal services fund." 1:34:30 PM Co-Chair Foster reminded the committee that the bill had two prior hearings, the fiscal notes had been reviewed, and no amendments were submitted. Representative Hannan reviewed the bill briefly. She characterized the bill as straightforward. She summarized that the billed statutorily changed the percentage from the Alaska Civil Legal Services Fund (ALSF) that was appropriated to the Alaska Legal Services Corporation (ALSC). Representative Johnson asked why more money was being added to the fund subsequent to higher funding being appropriated in the "last couple years." Representative Hannan responded that the ALSC had been funded up to $1.2 million in prior appropriations. The current appropriation using the Alaska Civil Legal Services Fund was to provide more stability and funding. She asserted that the importance of the ALSC was helping keep the Court System from extraordinary costs" and kept Alaskans housed, employed, and helped victims of sexual violence, etc. She emphasized in funding the corporations to the level that provided the services Alaskans needed. 1:37:29 PM Representative Allard voiced that there were almost 56,000 nonprofits and felt that they needed to raise funds on their own. She reported that the state was in a deficit. She encouraged nonprofits to raise their own funds. She knew of many non-profit individuals making $100 thousand to $250 thousand and were depleting the non-profit. She did not think taxpayers should be forced to pay for non-profits that were not favored by all. She believed non-profits should be forced to pay their own way. Representative Bynum related that the fiscal note showed it decrementing Undesignated General Fund (UGF) and incrementing Designated General Funds (DGF). He noted that aside from the base in the current budget, the bill did not take away the authority of the legislature to appropriate any amount for this item. He asked if the bill would be adding money to the fund or merely identifying the fund source. Representative Hannan asked for clarification on the question. Representative Bynum restated his question. He asked if the bill was adopted would it create an increment in the overall budget. Representative Hannan was unable to answer the question. Co-Chair Foster pointed out that the bill was reducing UGF but adding to DGF. He thought that the question was whether the bill was growing government. 1:42:06 PM Representative Stapp responded that the bill would take out funds that would normally go to GF and designating them to legal services for court fees. Co-Chair Foster deduced that the question was when funds were taken out of UGF would GF funds need to be backfilled for something else. Representative Johnson read from the sponsor statement, " court system filing fees can be appropriated by the Legislature to the existing Alaska Civil Legal Services Fund each year to provide access to civil legal aid for low-income Alaskans. She determined that the money was decreasing GF because the fees paid for services, and they almost never covered the entire expense. Representative Bynum was trying to get a better understanding if they would be incrementing or growing the budget by passing the bill or whether it supplanted UGF money and designated it for the specific purpose of the bill. Co-Chair Foster commented that he was pointing out there were multiple possible answers and was not directing comments at anyone. Co-Chair Josephson relayed a comment by Representative Allard. He countered that he favored the bill because he wanted to involve government in the business of people like those that committed domestic violence. He cited the ALSC website that listed their services. He cited elder advocacy and listed the specific service provided: income maintenance for social security and supplemental security income, adult public assistance, and food stamps, etc. He ascertained that the assistance kept the elderly in their homes. He furthered that ALSC also dealt with housing issues, healthcare issues, advanced directives, and consumer issues. He commented that ALSCs legal assistance in these matters theoretically, could reduce state expenses. He provided an example of elderly people that were scammed by criminals in a credit card fraud scheme. He referenced the statement about nonprofits Chief Executive Officer (CEO) salaries. He relayed that a first year ALSC attorney made $64 thousand per year. He shared that his sister who was a managing partner of a major law firm in Anchorage paid $115,000 per year for lawyers who had just passed the BAR [Uniform Bar Exam (UBE). He noted that ALSCs next pay increase was $74 thousand and in year's 11 to 15 of work the pay increases to $84 thousand. He emphasized that the ALSC attorneys do the work because they care about the population ALSC served. He supported the bill. 1:48:32 PM Representative Galvin shared why she would support the bill. She had heard from the Governor's Council on Disabilities and Special Education (GCDSE), which was very supportive of the bill because of ALSC's ability to address basic human rights and needs of the population. She commented that veterans and military families relied on legal assistance for evictions, foreclosures, and child support and were the highest unmet needs for homeless veterans. Finally, she had heard moving testimony about the importance of protective orders for survivors of domestic violence and sexual assault, which was provided by ALSC. Representative Jimmie asked how many cases were turned away because ALSC was underfunded. She supported the bill because it offered a lifeline to the most vulnerable people in her district. 1:51:20 PM MAGGIE HUMM, EXECUTIVE DIRECTOR, ALASKA LEGAL SERVICES CORPORATION (via teleconference), answered that on average they turned away one applicant for every applicant the corporation served. Representative Jimmie asked how many cases were handled in one year. Ms. Humm responded that in 2024 it handled 6,200 cases and roughly 40 to 50 percent of the people seeking assistance were turned away. Representative Allard had a series of questions. She reported that ALSC collected money from federal, state, and private funds. She asked what the total budget was. Ms. Humm responded that it totaled $10.3 million with federal funds amounting to between 40 to 50 percent. Representative Allard asked for the amount of private funds ALSC received. Ms. Humm needed time to find the answer. Representative Allard asked for a breakdown of federal, state, and private funds and the source of the private funds. She clarified that she favored the program, but she was concerned that the taxpayers were paying for it. She was concerned that those turned away made just enough money that they could not access the program but had to pay tax dollars to support the program. 1:55:02 PM Representative Allard asked if there was an accountability mechanism in place and how much funding went to their overhead. Representative Hannan wondered what she meant by accountability. She indicated that the bill changed nothing in statute apart from the percentage of funding from the dedicated revenue stream. Ms. Humm replied regarding the question of accountability. She offered that the corporation had rigorous audits every year to ensure good stewardship of the funds. She would need to report back about private funding. She shared that its Partners in Justice campaign for its private partners raised between $250 thousand and $300 thousand annually. In addition, it received private foundation funding and tribal funding. The corporation had dozens of funding sources and she was unsure how to define private funding. It was difficult to determine private versus public funding and she needed more time. Representative Allard asked what the income level was for services and whether there was an income criteria cutoff. Ms. Humm responded that the federal government dictated income eligibility guidelines and every applicant was screened for income and asset eligibility. She relayed that the criteria were 125 percent of the federal poverty guidelines or lower; for a household of one it was $24 thousand, for a house household of 8 it was $84 thousand as examples. There was some flexibility to increase the level up to 200 percent of the federal poverty level, but the exceptions were specific like for seniors most in need. At times, grant funding, private contracts, etc. were utilized to serve individuals over 200 percent of the level but were exceptions. 1:59:22 PM Representative Allard commented that some people were caught in the middle yet were paying taxes to help fund the program. She asserted that Nongovernmental Organizations (NGOs) needed to raise their own money. She felt bad for people who could not get help from ALSC but helped pay for it. Representative Johnson had previously been supportive of ALSC. She was concerned regarding the number and costs of the increases and believed that the bill represented a third ask" in consecutive years. She deemed that the bill was taking money away from the ability for the Court System to keep its courts open. She cautioned that the oil prices and stock market were alarming. She reiterated that the legislation took money away from GF. Representative Hannan asked for a representative from Judiciary to speak to the funding. Representative Johnson understood that the money did not go directly to the court system and knew that court fees were deposited into GF. She clarified that the ALSC funding was not taking money from the Court System. She clarified that GF was what funded the governmental system and just the basic services were necessary. She thought that the state would need to cut back services due to the budget situation and it was not the time to reduce GF funding. 2:02:42 PM Co-Chair Josephson believed that the funding did not directly hurt or hinder the Court System. He offered that there was no taxpayer burden in Alaska other than severance and corporate taxes. He supposed that certain state fee increases could subsidize the funding, but he emphasized that Alaskans did not pay taxes in the state for general government, and it was a "problem." Representative Bynum recounted that his initial question was if the passage of the bill increased spending. He discovered that if HB 48 was adopted, it would double the current increment. He determined it was an addition to the base by about $380 thousand. Representative Stapp indicated that he did not intend to hold the bill from moving forward but felt the funding was problematic and agreed with Representative Johnson's assessment that the bill was redirecting GF to ALSC reducing available GF revenue for other services. He would likely not support the bill but favored ALSC's work. 2:06:01 PM Representative Jimmie asked Ms. Humm who paid for public defenders that committed crimes against victims. Ms. Humm responded that the state paid for public defenders as required by state and federal constitutions. She added that the individuals the corporation served in civil court did not have a right to court appointed counsel, necessitating the need for legal aid organizations assistance. Some victims were entitled to some representation through the Office of victims Rights. The corporation represented crime victims in civil matters in situations like protective orders. Representative Jimmie understood the program allowed victims to have representation in court to face their perpetrator if they did not qualify. Ms. Humm responded in the affirmative and added that in a civil matter if one did not qualify for ALSC services they would have to find a private attorney. Representative Jimmie deduced that there was no guarantee that a victim would have representation. Ms. Humm replied in the affirmative and added that in a civil matter there was no guarantee a victim would have representation. Representative Tomaszewski wondered if there any thought to increasing the fees to increase the amount of money collected overall. 2:08:45 PM HUNTER MEACHUM, STAFF, REPRESENTATIVE SARA HANNAN, responded that the Alaska Supreme Court established the filing fee rate. She deferred the answer to Judiciary. NANCY MEADE, GENERAL COUNSEL, ALASKA COURT SYSTEM, JUDICIARY answered that the Supreme Court was the entity that set filing fees for the courts through an administrative rule. Representative Tomaszewski asked when the last time was the fees were increased. Ms. Meade responded that it was in approximately 2018 or 2019. Representative Tomaszewski asked if any of the money given to the fund was used for the filing fees. Ms. Meade responded that ALSC served the indigent population who were excluded from paying court filing fees. She did not see any connection. Representative Tomaszewski understood that the fees would be waived depending on income. Ms. Meade replied that those filing could seek a waiver that was granted when a person established that she/he was indigent. Representative Bynum asked about the ALSC and how the caseload was prioritized. 2:12:10 PM Ms. Humm answered that ALSC tried to help as many people as possible. She elaborated that one way to accomplish that was by providing different levels of service. She exemplified a person getting evicted that received assistance merely by dispensing some advice depending on the circumstances while Other situations needed more help. However, they did not keep a wait list because they did not want to disrupt the flow of applications. The amount of assistance depended on the capacity of the local office. The corporation had a wide range of resources to assist people. She summarized that there were a variety of ways to help people while being the most effective with the resources they had. The decisions were made on a daily basis. Co-Chair Foster asked if it was the will of the committee to report out the bill. 2:14:08 PM Co-Chair Schrage MOVED to REPORT HB 48 out of committee with individual recommendations and the accompanying fiscal notes. There being NO OBJECTION, it was so ordered. HB 48 was REPORTED out of committee with six "do pass" recommendations, two "do not pass" recommendations, two "no recommendation" recommendations and with one previously published fiscal impact note: FN2 (DCCED), and one previously published zero fiscal impact note: FN1 (JUD). [Representative Johnson was absent during the moving of the bill] 2:14:56 PM Co-Chair Foster relayed that HB 17 was heard twice in committee, the fiscal notes were reviewed, and no amendments were received.