SENATE BILL NO. 104 "An Act relating to appropriations to the civil legal services fund." 2:24:17 PM Co-Chair Olson invited Senator Dunbar to the table. 2:24:36 PM SENATOR FORREST DUNBAR, SPONSOR, explained that the bill would increase funding for the Alaska Civil Legal Services Fund. He shared that legislation allowing the legislature to appropriate filing fees for ALSC was passed in 2018 and was originally set at 25 percent but lowered to 10 percent with the intention to reassess the need for a higher appropriation later; those contributions were now necessary to fully support their clients in need. He spoke of his internship at Alaska Legal Servies and his passion for providing free legal services to residents in the state. 2:26:45 PM ARIELLE WIGGIN, STAFF, SENATOR FORREST DUNBAR, discussed a Sectional Analysis (copy on file): SECTIONAL ANALYSIS SB 104: CIVIL LEGAL SERVICES FUND Section 1: amends AS 37.05.590 Civil Legal Services Fund so that up to twenty-five percent, instead of ten percent, of Court System filing fees can be appropriated by the Legislature to the existing Civil Legal Services Fund each year. 2:27:14 PM Senator Wilson referred to the statute and asked where the remainder of the court filing fees would go. 2:28:03 PM NIKOLE NELSON, EXECUTIVE DIRECTOR, ALASKA LEGAL SERVICES CORPORATION, asked whether Senator Wilson was referring to the 50 percent of punitive damages that were part of the fund. Senator Wilson replied in the affirmative. Ms. Nelson explained that the fund had two components: the first allowed for 50 percent of punitive damages awarded to the state to go into the fund, which had not generated much revenue. She said that the statute that governed the fund had been amended in 2018 to include 10 percent of court system filing fees, on top of the punitive damages award. She said that when the bill was amended in 2018, it had originally been 25 percent, which was negotiated down to 10 percent, with the caveat that it would be increased if the fund did not meet community need. 2:30:05 PM Senator Wilson asked whether the increase would increase court fees, and if those fees were needed by the Court System. He wondered whether putting them in the general fund would leave the Court System in financial need. Ms. Nelson understood that the funds did not go to the Court System, but rather into the general fund. 2:31:10 PM Senator Wilson reiterated his question about court filing fees. 2:31:47 PM NANCY MEADE, GENERAL COUNSEL, ALASKA COURT SYSTEM, relayed that the bill did not impact the finances of the Alaska Court System. She said that every dollar that the system collected for filing fees went directly to the general fund. She stated that the systems budget was not based on filing fees. Senator Wilson asked when the last time the Court System had considered increasing filing fees. Ms. Meade believed fees had been increased in 2018. She thought that the increase had been written into intent language in the Operating Budget. She said that the basic filing fee for a civil case was $250. 2:33:41 PM Ms. Nelson continued her testimony. She thanked the committee for hearing the bill. She stressed that both the state and federal constitutions guaranteed due process and equal protection under the law, but a right to council was not guaranteed in the civil justice system. She said that there was a gap between those who needed civil legal aid and those who received it. She said that legal aid had not kept pace with community need. She provided a background and the mission of Alaska Legal Services (ALS). MS. Nelson shared that the mission of ALS was to ensure fairness to all in the justice system, regardless of economic status or geographical location. The work was done through providing individual advice and representation, providing selfhelp materials, and providing guidance for those going through the system on their own. The work was done through twelve regional offices, and the organization maintained a statewide footprint. Ms. Nelson continued that the work was done by employees and volunteers. She listed typical consumers who sought the help of ALS from day to day, which included some of the state's most vulnerable residents. 2:37:11 PM Ms. Nelson emphasized that access to justice in the civil system was paramount. She cited that ALS received contributions from communities where their offices were located. She shared that ALS had provided representation to thousands of Alaskans, 86 percent of which had resulted in positive outcomes. Ms. Nelson noted that there was a $5 to $1 return on funds invested into the program. She said that ALS had saved the state $2.6 million in avoided medical and counselling costs. Ms. Nelson cited the problem of turning away hundreds of families per year due to lack of resources. She noted that the target population continued to grow, while funding had not kept pace. She said that in 1984, ALS had been appropriated $1.2 million to serve a target population of 40,000. She stated that in the current state fiscal year the state appropriation, coming from 2 sources, was equal to $681,600 to serve a target population of 128,000. She said that in 1984 the state was spending $28 per person, which when inflation adjusted for 2023 would be $81 per person. She lamented that the funds had not increased, or been adjusted for inflation, and that the state currently spent $5 per person. 2:40:36 PM Ms. Nelson stressed that when the fund was amended in 2018 to include the 10 percent filing fees, the promise was to revisit the matter should it be found that funding was not sufficient. She stressed that funding had not kept pace, and the issue needed to be addressed. 2:41:08 PM Ms. Nelson mentioned that ALS was incredibly cost-efficient and did the best it could with the available resources. 2:41:47 PM Senator Bishop understood that ALS turned away 200 cases per year. Ms. Nelson clarified that half of the cases brought before them were turned away due to lack of resources. Senator Bishop asked whether Ms. Nelson could put a monetary figure to the number of people that ALS had to turn away. Ms. Nelson said that she would provide the information. She cited that for every additional $100,000 added to the ALS budget, 180 more clients could be served. 2:43:04 PM Ms. Nelson mentioned that ALS was leveraging resources with donated office space and other support from local communities where offices were located. She said that the pro bono program had leveraged nearly 4,000 hours of donated time in the last year. She emphasized that the state needed to address the civil justice crisis and assure that access to justice was a reality for everyone. 2:44:24 PM SANDRA MOLLER, DIRECTOR, DIVISION OF COMMUNITY AND REGIONAL AFFAIRS, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT (via teleconference), addressed the zero FN 1 from DCCED. 2:45:23 PM AT EASE 2:45:52 PM RECONVENED Senator Wilson considered FN 1, which showed fiscal impact on the 'Grants and Benefits' line and the 'Legal Services' line through FY24. He asked why there were no reflected outgoing costs, FY25 through FY29. He thought the note should be indeterminate rather than zero. Ms. Moller affirmed that the numbers on the note were correct. She admitted that the numbers in the outgoing years were indeterminate. Senator Wilson argued that the note reflected a zero cost rather than an indeterminate cost. Ms. Moller relayed that the fiscal note should be indeterminate and not zero. 2:48:37 PM Senator Bishop addressed FN 1 from DCCED, OMB Component 2879. 2:49:11 PM Co-Chair Olson OPENED public testimony. 2:49:48 PM AT EASE 2:50:05 PM RECONVENED Co-Chair Olson CLOSED public testimony. SB 104 was HEARD and HELD in committee for further consideration.