HOUSE BILL NO. 284 An Act relating to participation in certain student fellowships as an allowable absence from the state for purposes of eligibility for permanent fund dividends; and providing for an effective date. REPRESENTATIVE MIKE HAWKER, SPONSOR, explained that HB 284 would correct an inequity in the statutes regarding allowable absences for Permanent Fund Dividends (PFD). Current law provides for an allowable absence for students who are "receiving vocational, professional, or other specific education on a full-time basis for which, as determined by the Alaska Commission on Postsecondary Education, a comparable program is not reasonably available in the State." He pointed out that for some reason, the above statutory language has been interpreted by regulation to exclude students who are participating in an international educational exchange under a U.S. Fulbright Scholarship. Representative Hawker continued, the Fulbright Scholar Program, which was signed into law by President Truman in 1946, is sponsored by the United States Department of State, Bureau of Educational and Cultural Affairs. Each year, the program sends 800 scholars and professionals, chosen for their academic merit and leadership potential to more than 150 countries, where they lecture or conduct research in a wide variety of fields. Those chosen for the Fulbright program represent Alaska and the United States in foreign countries all over the world. Grants are typically for three months to one year. Representative Hawker urged the Committee's support of the bill to correct the inequity in current law. 1:46:20 PM DEMAIN SCHANE, SELF, JUNEAU, testified in support of the bill. He indicated he currently works for the National Oceanic & Atmospheric Administration in Juneau. He pointed out that the proposed amendment adds one more excusable absence, which he thought worthy. Mr. Schane noted he had spent 10 months in Iceland on a U.S. Fulbright grant, studying the European Union's mechanism for regulating escapes from farm fishing operations. Mr. Schane continued, the Fulbright Program is funded through the U.S. Department of State and promotes a cultural and educational exchange program in numerous foreign countries. The program offers U.S. citizens an opportunity to further their understanding of issues and policies of international significance and experience and how other cultures endeavor to resolve the issues. He urged that the Legislature recognize and support Alaskans' efforts to pursue those opportunities by allowing them to do so without losing their residential status and eligibility for a PFD dividend disbursement. 1:48:26 PM EMILY FERRY, SELF, JUNEAU, echoed sentiments of the previous testifier, voicing support for adoption of the legislation & the amendment. She stated that she and her husband had the intent to return to the State and indeed did return to start their family. She reiterated her support that Amendment 1 be passed as it makes the dividend retroactive. 1:49:58 PM ROBB KULIN, (TESTIFIED VIA TELECONFERENCE), STUDENT, UNIVERSITY OF SAN DIEGO, testified in support of the proposed legislation and the attached amendment. He pointed out he currently is in a doctorate program at the University of California and prior to that, he had participated in 2004 in the Fulbright scholar program. He reiterated his support 1:54:41 PM PUBLIC TESTIMONY CLOSED. 1:55:21 PM Co-Chair Meyer asked the number of students that would be eligible recipients. Representative Hawker understood that for Alaskans, it would be less than ten per year and that only three were affected in the last two years. Vice-Chair Stoltze recalled that one of his constituents had been a recipient of the Fulbright scholarship. 1:56:26 PM Representative Gara noted support for the legislation, however, pointed out other exceptions of concern to the receipt of the PFD, including the Peace Corp and Ameri-Corp [National Peace Corp] volunteers. Representative Hawker observed that volunteers in the Peace Corp are included, indicated in language on Page 2, Line 27. Representative Gara reiterated that Ameri-Corp participants should also be included. Representative Hawker responded that issue had not yet been addressed. 1:57:47 PM Representative Hawker MOVED to ADOPT Amendment 1, #25- LS1142\A.1, Cook, 1/24/08. (Copy on File). Co-Chair Meyer OBJECTED for discussion purposes. Representative Hawker explained the amendment. When the bill was originally drafted, an effective date of January 1, 2009, was included for the prospective application. He had spoken with Legislative Legal regarding persons in the past two years and their efforts to get the regulation changed. Legislative Legal proposed the language of the amendment to address the concern. He believed that the proposed language "rights a wrong". Representative Gara revisited the retroactive issue. He explained that the Courts normally interpret retroactive language such that, they have concerns retroactively removing rights. No one can change criminal law retroactively and that important legal rights can not be taken away. Co-Chair Meyer asked how an amount could be determined if the number of students is not known; he questioned where the dollars would come from. Representative Hawker admitted that the State does not have an accurate account of the number of students that would be involved. He believed the diluting effect would be insignificant to the PFD. He was certain it would be a small number of students affected. 2:01:19 PM The funds would be taken from the earning reserve of the Permanent Fund. Representative Thomas commented on the retroactive provision and the relationship to other applicants. Representative Hawker understood that there are statutory requirements clarifying application dates. If the student anticipates a dividend, they must submit an application indicating intent to return and remain in Alaska. Otherwise, they would not qualify. 2:02:20 PM Co-Chair Meyer referenced testimony from Mr. Kulin, in San Diego. Representative Hawker responded that Mr. Kulin fully intends to return to Alaska to practice his profession. Representative Kelly asked if the student would be required to return to Alaska in order to receive the dividend. Representative Hawker deferred that response to the Department of Revenue. At present time, the language specifies only the intent to return. 2:03:44 PM DEBBIE RICHTER, DIRECTOR, PERMANENT FUND DIVIDEND DIVISION, DEPARTMENT OF REVENUE, explained that the funds from which the dividends would be paid, are funds held back each year. The money is there; the Division does not anticipate a large number of requests. 2:04:34 PM Representative Kelly reiterated his question, whether, the student would be required to return to Alaska in order to actually receive the PFD. Ms. Richter explained currently, the dividends are paid when the application is received; students who are out of State, fill out a form from the school, indicating enrollment. Those students certify with the application that they intent to return to Alaska. She acknowledged that "intent" is a difficult matter to determine. With regard to the amendment, the Division most likely has those applications on file, since they were originally denied. Representative Kelly worried about the growing number of applications. He suggested that students actually be required to return to the State before receiving the dividend. Ms. Richter was not aware of a requirement ever written into the language, stipulating that students actually return before receiving their dividend. Representative Hawker mentioned escrowing dividends until the student returns. He provided a brief history of such an occurrence. He believed that as a policy call, there would be merits to having that discussion. Representative Kelly addressed the idea of retroactive claims. Ms. Richter had no previous history with those circumstances. Representative Hawker explained his motive, stating if there was a new policy change, it should be prospectively applied. He believed that the exception in the statutory language, should not have applied to the Fulbright scholars since it does not apply to post secondary students. In the specific case at hand, the retroactively language provides dividends to that class of student. He believed that the amendment clarifies the original intent. 2:09:34 PM Representative Kelly questioned how the determination of the length of the retroactivity was made; he inquired the number of applicants expected. He agreed anyone having received the Fulbright scholarship should be eligible. Representative Hawker explained that his office had discussions with some of the students and then decided to prepare the legislation. He offered to entertain an amendment to Amendment 1. Representative Kelly thought that having the language on record, would clarify intent. 2:11:29 PM Representative Gara proposed inclusion of a memorandum from the Legislative Legal Services. He believed if Section 2 was retroactive, it would provide for every allowable absence. He did not think that was the intention of the bill's sponsor. He recommended making Section 1 retroactive rather than Section 2. Representative Hawker pointed out that Amendment 1 had been drafted by Tam Cook, Attorney and Director of Legislative Legal. He added that he would request a reply to the amendment by Ms. Cook for Representative Gara. 2:13:54 PM Co-Chair Chenault mentioned the numerous PFD issues that had come to his office, while indicating his appreciation to the Division for their willingness and work on the concerns. In response to issues suggested by Representative Gara, Representative Hawker stated it would be effective only if exceptions were indicated in items 1-16 and had been put into place after January 1, 2005. The two affected would be Peace Corp and the Olympic Teams. Representative Gara understood that it would also apply to Lines 1-14. He reiterated that everything in Section 2 would become retroactive. Representative Hawker agreed that was accurate but would have no consequence because items 1-14 have been in place since before 2005, when the retroactivity would apply. Co-Chair Meyer recommended a letter from Ms. Cook would satisfy Representative Gara's concerns. 2:15:59 PM Co-Chair Meyer WITHDREW his OBJECTION to Amendment 1. There being NO further OBJECTION, Amendment 1 was adopted. 2:16:22 PM Representative Thomas commented on members of the National Guard being sent to Iraq and denial of their PFD applications when submitted late. He asked the number of National Guard members who have received denials. Additionally, he worried about the elders, who suffer from Alzheimer's and forget to file. 2:18:13 PM Vice-Chair Stoltze MOVED to REPORT CS HB 284 (FIN) out of Committee with individual recommendations and with the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CS HB 284 (FIN) was reported out of Committee with a "do pass" recommendation and with zero note #1 by the Department of Revenue. 2:19:05 PM #HB296 HOUSE BILL NO. 296 An Act extending the termination date of the Board of Parole; and providing for an effective date. MIKE SICA, STAFF, REPRESENTATIVE BOB LYNN, explained that HB 296 would extend the termination date of the Board of Parole until June 30, 2016. The Board of parole serves as the parole authority for the State. As such, the Board fulfills the Alaska Constitution requirement that the State establish a parole system. The Board's primary responsibilities include determining a prisoner's suitability for discretionary parole and setting conditions for individuals receiving parole. Another major responsibility of the Board is offering parole revocation hearings. The Legislative Audit Division recently concluded, there is a demonstrated need for the Board of Parole and that the terminated date be extended until June 30, 2016. He urged support of the bill. 2:21:28 PM Representative Gara suggested that since there was no controversy on the bill, the Committee should pass it out. Co-Chair Meyer responded that the Committee would hear public testimony. 2:22:22 PM MIKE STARK, VICE CHAIR, ALASKA BOARD OF PAROLE, introduced Dwayne Peeples, Deputy Commissioner, Department of Corrections. Mr. Stark pointed out that the Alaska Constitution calls for a parole system. Legislative implementation of that has been through the creation of a Parole Board. The Parole Board is the most active board or commission in the State. There are five members on the board, which works more than 180 days per year to address risk and release issues and provide protection of the public. He urged that the Board sunset be extended. 2:23:59 PM KATHY MATSUMOTO, (TESTIFIED VIA TELECONFERENCE), EXECUTIVE DIRECTOR, ALASKA BOARD OF PAROLE, ANCHORAGE, spoke in support of the legislation. She emphasized that the Parole Board provides a valuable service to the citizens of Alaska and work closely with the Department of Corrections. She highlighted the roll of the Board in performing basic information gathering to help prisoners as they move out of the system. She pointed out recommendations for treatment programs to help address recidivism. She indicated the Board's support of the requests made by the Department of Corrections to fund treatment programs for offenders. 2:26:01 PM ED RAIS, (TESTIFIED VIA TELECONFERENCE), CHAIR, ALASKA BOARD OF PAROLE, ANCHORAGE, testified in support for the extension of the Parole Board. He spoke to the key challenges of the Board based on the number of people coming out of prison. Discretionary hearings are driven by statute. Mr. Rais urged passage of the sunset audit, reiterating that the work of the Parole Board is extensive. Mr. Rais discussed the diligence of the Board to insure public safety. He hoped in the future, the Board would be able to evaluate & implement statistics for information to increase appropriations and be funded like other nationwide parole boards. He indicated that re-entry programs are important aspects for the future, especially in programs for substance abuse & sex offender treatment. Currently, there are 2.3 million people incarcerated throughout the U.S. 2:30:23 PM PUBLIC TESTIMONY CLOSED. 2:30:58 PM Vice-Chair Stoltze asked if parole had been addressed in the Alaska Constitution. He indicated his support for passage of the bill. 2:32:27 PM Representative Kelly expounded that the average member of the public does not see the accomplishments of the Board but rather the failures of the Board when something bad happens by a parolee. He inquired if there had been an audit determination to measure how well the Board is doing. PAT DAVIDSON, LEGISLATIVE AUDITOR, LEGISLATIVE AUDIT DIVISION, LEGISLATIVE AFFAIRS AGENCY, advised that during the course of the audit, the Division evaluated the effectiveness of the discretionary parole decisions made by the Board. The Board takes a risk-based approach. The number of potential parolees with the lowest risk is given the highest rate of paroles. That group will have the lowest rate of the parole revoked, compared to the other end of the spectrum, having the highest risk group of individuals with only a 24% granted parole. Revocation is at about 43%. During the course of the audit, parole revocation was used as the measure of effectiveness for the Board's decision making. She maintained that the risk assessment model is working. 2:35:31 PM Representative Kelly addressed audit recommendations for public meetings with the parolees. He worried that revocation of parole is different from someone being injured and he wanted to determine a way to keep track of the number of felons. Ms. Davidson replied that would not be possible. She suggested that by providing more opportunities for the general public by holding public meetings could help to develop missions and measures, putting the information and annual reports in place. The audit attempted to compare discretionary parole rates against offenders who did not get parole but were released from jail. There was not enough data to make the comparison. 2:38:02 PM Representative Kelly requested criteria measuring how well the job was being done. In the current system, victims are not protected; he thought that public meetings could help measure how well the Board is actually doing their work. 2:39:33 PM Vice-Chair Stoltze asked if the Office of Victim's Rights had been contacted before the audit was done to help determine certain aspects. Ms. Davidson said yes that office had been included as well as the victim notification process. Previously, the process included only the Board of Parole, however, a division within the Department of Corrections has taken up the issues. Legislative Audit has recommended that the Department provide a formal communication system between those organizations to insure that victim notification does occur. 2:40:57 PM Vice-Chair Stoltze recommended that the Ombudsman Office also be included. Co-Chair Meyer pointed out a new fiscal note dated 1/30/08, indicating the funding in the Governor's proposed FY09 budget. 2:41:55 PM Vice-Chair Stoltze MOVED to REPORT HB 296 out of Committee with individual recommendations and with the accompanying new fiscal note. There being NO OBJECTION, it was so ordered. HB 296 was reported out Committee with a "do pass" recommendation and a new fiscal note by the House Finance Committee.