HB 75 "An Act making appropriations for the operating and loan program expenses of state government, for certain programs, and to capitalize funds; and providing for an effective date." HB 76 "An Act making appropriations for the operating expenses of the state's integrated comprehensive mental health program; and providing for an effective date." AMENDMENTS UNIVERSITY OF ALASKA DEPARTMENT OF PUBLIC SAFETY DEPARTMENT OF HEALTH AND SOCIAL SERVICES UNIVERSITY OF ALASKA Representative Davies MOVED to adopt Amendment UA-1 (copy on file). Representative Kelly OBJECTED. Amendment UA-1 would add $2.5 million dollars t the University of Alaska. Representative Davies explained that the amendment would restore the University's appropriation to last year's level. He maintain that the University has been cut too far in the past few years. He pointed out that Alaska spends 5 percent of the state's total revenues on the university system. He noted that Alaska spends less than all but six other states. He stressed that funding is being reallocated into deferred maintenance. He noted that computer and laboratory equipment is out dated. He stated that tuition is higher than the national average. He emphasized that campus morale is low. Co-Chair Hanley clarified that there is a two percent increase in overall spending from the previous year. DISCLOSURES Co-Chair Hanley disclosed that he has a brother who works for the Alaska Court System, a brother that works for the Department of Transportation and Public Facilities and his mother works for the Alaska Public Utilities Commission (APUC). He added that he is a commercial fisherman. Representative Davies disclosed that he maintains a university adjutant positio that allows him to sit on graduate advisory committees. He noted that he has n financial relationship with the University. He added that his wife is a school teacher in Fairbanks. UNIVERSITY OF ALASKA Co-Chair Therriault pointed out that some of the increase to the University of Alaska is in the form of federal research grants that cannot be used for educational support. He expressed concern with the funding source. Representative Davies stressed that despite tuition increases the University of Fairbanks is facing a $5 million dollar internal reallocation in order to meet budgetary goals. A roll call vote was taken on the MOTION to adopt Amendment UA-1. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Martin, Therriault, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (3-7). Representative Davies MOVED to adopt Amendment UA-2 (copy on file). Co-Chair Hanley OBJECTED for purposes of discussion. Representative Davies explained th the amendment would decrease the unallocated reduction amount by $530 thousand dollars. He noted that this represents the amount that the Governor proposed b reduced from the Alaska Science and Technology Foundation. He observed that th total reduction to the University of Alaska is slightly over $3 million dollars He maintained that the reduction should be back-filled with general fund dollars. A roll call vote was taken on the MOTION to adopt Amendment UA-2. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Martin, Therriault, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (3-7). Representative Davies MOVED to adopt Amendment UA-3 (copy on file). Co-Chair Hanley OBJECTED. Representative Davies explained that the amendment would reverse the Governor's proposal to back-out $530 thousand dollars of Alaska Science and Technology funds. The reduction to the University of Alaska would be maintained at $2.5 million dollars. Co-Chair Hanley summarized that there would be no general fund affect. In response to a question by Representative Kelly, Co-Chair Hanley explained th the Governor's approach would phaseout the University of Alaska's portion of Alaska Science and Technology funding over five years. A roll call vote was taken on the MOTION to adopt Amendment UA-3. IN FAVOR: Davies, Grussendorf, Moses, Kelly, Therriault OPPOSED: Davis, Foster, Kohring, Martin, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (5-5). DEPARTMENT OF PUBLIC SAFETY DISCLOSURES Co-Chair Hanley noted that his father has worked with the Deputy Commissioner a is friends with the Commissioner to the Department of Public Safety. Co-Chair Therriault noted that his brother-in-law is employed as a trooper. DEPARTMENT OF PUBLIC SAFETY Representative Davis MOVED to adopt Amendment PS-1 (copy on file). He explaine that the Bristol Bay area needs additional enforcement officers in the Division of Fish and Wildlife Protection. He stated that the amendment would fund two part-time seasonal enforcement officers at $36 thousand dollars. Alaska Police Standards Council designated receipts would fund the appropriation. He questioned if fines in the Fish and Game Fund could be used. Co-Chair Hanley noted that the fines collected in the present year would be appropriated in the following year's budget. He cautioned against funding on- going expenses from the fines. KENNETH E. BISCHOFF, DIRECTOR, DIVISION OF PUBLIC SAFETY agreed that revenues from fines fluctuate. He could not determine if there would be enough funds fr fines to fund the amendment. In response to a question by Representative Davies, Mr. Bischoff noted that the Alaska Police Standards Council's total designated receipt authority, proposed by the Governor, is $619 thousand dollars. The Subcommittee recommended a $12 thousand dollar reduction. The amendment would further reduce the designated grant authority by $36 thousand dollars. He observed that the amendment would not present a problem. There being NO OBJECTION, Amendment PS-1 was adopted. Representative Grussendorf MOVED to adopt Amendment PS-2 (copy on file). Representative Davis OBJECTED. Amendment PS-2 would add $250 thousand dollars to the Village Public Safety Officers Program. Representative Grussendorf note that the amendment, with the addition of lapsed funding appropriated in the supplemental budget, would fund 10 positions. He spoke in support of the amendment. He stressed that there are presently 33 vacancies. Representative Davies acknowledged that additional village public safety office are needed. He emphasized that lapsed funding was appropriated in the supplemental budget. He summarized that $300 thousand dollars was funded for additional village public safety officers. He stressed that the lapsed funding is the result of vacancies. He noted that there is a high turn over rate in th program. He anticipates that there will be funding lapsed in FY 98. Representative Kohring spoke in support of the amendment. He emphasized that public safety is an essential item. Representative Foster pointed out that village public safety officers have replaced troopers in rural areas at a considerable reduction of cost. DEL SMITH, DEPUTY COMMISSIONER, DEPARTMENT OF PUBLIC SAFETY clarified that the Department anticipates adding 6 - 7 village public safety officers. A roll call vote was taken on the MOTION to adopt Amendment PS-2. IN FAVOR: Davies, Grussendorf, Moses, Kohring, Foster OPPOSED: Davis, Kelly, Martin, Therriault, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (5-5). Representative Grussendorf MOVED to adopt Amendment PS-3 (copy on file). Representative Davis OBJECTED. Amendment PS-3 would add 60 thousand dollars fo the Training Academy. Representative Grussendorf noted that reductions to the Training Academy would require that a trooper be brought in as an instructor. He explained that the amendment would allow the state trooper to remain in the field. Representative Foster noted that several troopers are retiring. Mr. Smith observed that 15 Alaska state troopers graduated from the academy in 1996. He agreed that there are a substantial number of troopers retiring. He stated that two academies are run a year. Troopers are included in classes as funding is available. Representative Davis questioned if Alaska Police Standard Council receipts coul be used. Mr. Bischoff noted that the Alaska Police Standards Council Program i in the start-up phase. He stated that at full performance the program anticipates $700 thousand dollars in yearly revenues. He stated that the progr receipt authority could be reduced in the next year. Representative Davis MOVED to AMEND Amendment PS-3 by changing $50 thousand dollars of the revenue source to the Alaska Police Standards Council. (Tape Change, HFC 97-76, Side 2) Representative Davies noted that the Department of Public Safety's budget would be $8,000 thousand dollars beyond the cap. Co-Chair Hanley summarized that the amendment would reduce the amount the Counc would receive. The general funds would go to the Training Academy. He observe that the Council would not utilize their full receipt authority in FY 98. There being NO OBJECTION, the amendment to Amendment PS-3 was adopted. There being NO OBJECTION, Amendment PS-3 as amended was adopted. Co-Chair Therriault MOVED to adopt Amendment PS-4 (copy on file). He explained that 470 Fund revenues are received by the Department of Environmental Conservation for administration. The Department of Environmental Conservation transfers funds to other agencies for certain functions. He noted that these funds should be shown under the funding category 1055, Interagency Receipts/Oil and Hazardous Response. The amendment would correct the funding source by changing interagency receipts to category 1055. There being NO OBJECTION, it w so ordered. In response to a question by Representative Martin, Co-Chair Therriault stated that 470 funds are used for a dispatcher that answers the hazardous spill hot- line. There being NO OBJECTION, Amendment PS-4 was adopted. DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS Representative Kohring MOVED to Delete the following intent language: It is th intent of the legislature that the Administrative Offices in Anchorage and June be combined into one location, that being Anchorage, for efficiency purposes. (copy on file). He noted that the issue needs further consideration. There being NO OBJECTION, it was so ordered. DEPARTMENT OF HEALTH AND SOCIAL SERVICES Representative Davies MOVED to adopt Amendment HSS-1 on behalf of Representativ Brice (copy on file). REPRESENTATIVE TOM BRICE explained that Amendment HSS-1 would restore a $2 million dollar general fund match to the Alaska Work Programs. He observed tha welfare reform is attempting to put more people to work. The passage of SB 98 made available an additional $2 million dollars for reinvestment. These reinvestment dollars were reduced by the Subcommittee. He spoke in support of the amendment. He maintained that the proposed cuts to the work program will make it impossible to achieve federal work participation rates resulting in penalties to the state. He asserted that the Work First Program is the best wa to help people to obtain long-term self sufficiency. Co-Chair Hanley clarified that work programs are receiving the same dollar amou in FY 98 as in FY 97. The Department proposed to transfer $1.5 million additional funds into eligibility determination or "field services". The inten is to spend more time with clients as they come into the program so that they d not have to go through an intensive training process. Co-Chair Hanley summarized that the intent of the original jobs program was to serve clients that were the least likely to obtain jobs. Therefore, a lot of intense training was needed. He observed that the dollars spent in the old job program were cost intensive. The program did not serve people on the edge. Testimony indicated that if child and health care were available, clients would be able to get off the welfare rolls. Estimates showed that approximately 25 percent of these clients would be able to get off welfare with the addition of child and health care. He observed that welfare reform allows clients to keep medicaid and provides childcare. In addition, disincentives have been reduced. He asserted that the Department's assumptions are too high. The Department assumes that $2,300 dollars a year will be spent per person. The Subcommittee budget allows $1,900 dollars a year per person. He observed that in FY 96 the Jobs program served 2,100 people. He noted that $1.2 million dollars were adde in FY 97. He stated that the Department is serving 100 less people despite the $1.2 million dollar increase. Representative Brice spoke in support of the amendment. JANET CLARK, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALT AND SOCIAL SERVICES clarified that the Aid to Families with Dependent Children (AFDC) caseload has an annual growth rate of approximately 2 percent. She explained that the low numbers in the old jobs program was the result of effort spent to implement the new jobs program. She noted that $2 million dollars wou fund grants and contracts to follow the work first model used in Oregon. Clien are given an intensive month long job preparation class. She observed that contractors would receive approximately $100 - $200 dollars a month per person for the classes. She noted that the state is required to have 3,189 people participating in a job activity per average month. The Department's plan would allow for 4,200 people in order to assure that 3,189 people meet the requirements. Representative Martin maintained that Alaska's programs are so generous that th entice clients to stay on welfare and attract individuals to the system. Ms. Clark stressed that surveys have not indicated that people move to Alaska i order to receive welfare. She maintained that the economy affects the number o recipients. In response to a question by Representative Davies, Ms. Clark explained that th Governor's budget would reduce the risk that the number of recipients served by the state falls below the federal mandate. A roll call vote was taken on the MOTION to adopt Amendment HSS-1. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Representative Mulder was absent from the vote. The MOTION FAILED (3-7). Representative Davies MOVED to adopt Amendment HSS-2 on behalf of Representativ Brice (copy on file). Representative Brice explained that the amendment would add $1 million dollars to the Department of Health & Social Services, Public Assistance Administration Child Care Benefits. He emphasized the importance of childcare in allowing single parents to go to work. Co-Chair Hanley stated that it is not his intent to short-fund childcare. He maintained that there is a duplication of dollars. He observed that some paren will already qualify for assistance under programs in the Department of Communi and Regional Affairs. He observed that Native groups have received $3.5 millio dollars more for job work programs in FY 98 than FY 99. He stated that Native groups have a total of $7 million dollars in their childcare component. (Tape Change, HFC 97-77, Side 1) Ms. Clark clarified that the Department included $500 thousand dollars in Nativ childcare funding in their calculations of need. She stated that the Departmen is researching means to better leverage this funding. The Governor's budget would serve a little over 1,400 families per month at $500 dollars a month. Ms. Clark observed that the federal government consolidated a number of program into one childcare block grant. She maintained that the Department considered duplication. Co-Chair Hanley maintained that the Governor's budget does not indicate that consideration was given to duplication of eligibility in the Department of Community and Regional Affairs. A roll call vote was taken on the MOTION to adopt Amendment HSS-2. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Martin, Hanley Co-Chair Therriault and Representative Mulder were absent from the vote. The MOTION FAILED (3-6). Representative Davies MOVED to adopt Amendment HSS-3 (copy on file). Representative Brice explained that the amendment would reinstate $3 million dollars in designated program receipts for the Department of Health & Social Services. The receipts are the result of an increased collection of child support payments. The amendment would allow the Department to put the funding back into the Alaska Temporary Assistance Program (ATAP). Co-Chair Hanley explained that there will be a reduction in payments due to legislation that allows recipients to retain 40 percent of their benefits with the addition of earned income. Recipients will be able to keep the first $300 hundred dollars and 40 percent of any additional earned income. He observed th recipients may not be eligible for medicaid with the additional income. He explained that if the earned income disregard was drop from $300 to $150 hundre dollars that there would be an additional $1.8 million dollars in revenues to t state. He noted that earners not included in the Governor's fiscal note along with additional earners anticipated by the Subcommittee make up the $3 million dollar reduction calculated in the program. He reiterated that the intent is n to short-fall the appropriation. Ms. Clark clarified that the Governor's budget included $1.2 million dollars in receipts from the Child Support Enforcement Division from absent parents to offset the cost of welfare. She explained that the intent is to keep the standards of medicaid and ATAP the same. She stated that the Department agrees that Co-Chair Hanley's calculation for the difference in earned income disregar is correct. She maintained that designated program receipts should be added ba into the budget. Co-Chair Hanley observed that there is a $3 million dollar increase in spending He estimated that additional earners would result in a loss of $600 thousand dollars. Ms. Clark agreed that the Subcommittee's approach to earned income makes sense. She stated that the Department wants to look at additional earners. She noted that this is the cash side of the program. She observed that there will be between 7 - 8 percent in cash going out to recipients. Co-Chair Hanley reiterated his belief that there are approximately 300 more earners. Representative Davies MOVED to AMEND Amendment HSS-3 to delete $3 million dolla and insert $1 million dollars. There being NO OBJECTION, it was so ordered. A roll call vote was taken on the MOTION to adopt Amendment HSS-3 as amended. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Martin, Therriault, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (3-7). Representative Davies WITHDREW Amendments HSS-4 and HSS-5. Representative Davies MOVED to adopt Amendment HSS-6 (copy on file). Representative Brice explained that Amendment HSS-6 would add $900 thousand dollars for the COMPASS program. He explained that the COMPASS program coordinates child well-being programs. Co-Chair Hanley explained that the state can receive approximately $2.2 million dollars in medicaid money through schools that have not been billed. He observ that $1 million dollars of this funding will be shared with school districts. The Department proposed that the remaining funds be used for the COMPASS program. The COMPASS program would coordinated activities and give out grants. He noted that the Subcommittee used the money to offset general fund dollars i the Maternal Childcare component. He expressed concern that a new program was started without legislative authorization. Ms. Clark noted that the school districts' portion helps to offset administrati costs. She discussed the COMPASS program. Representative Davies spoke in support of the COMPASS program. Representative Martin spoke against the amendment. He questioned the number of referral programs. Ms. Clark emphasized that the COMPASS program is not a referral program. She clarified that the program allows all the agencies in a community to come together with one proposal and one goal. The program also provides partnership between local communities, non-profit providers, school districts and state agencies. Representative Brice emphasized that the program helps to obtain greater efficiencies and resolve statutory and community issues that create barriers between providers. A roll call vote was taken on the MOTION to adopt Amendment HSS-6. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Martin, Therriault, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (3-7). Representative Davies MOVED to adopt Amendment HSS-7 (copy on file). Representative Brice explained that the amendment would add $300 thousand dolla to State Health Services for Healthy Families. This program was reduced by thi amount. The amendment would fund 92 high stress, at risk families. The Health Family program addresses prevention of child abuse and neglect. Co-Chair Hanley OBJECTED to Amendment HSS-7. He noted that the Healthy Familie program was authorized to start one pilot program in FY 95. In FY 96 funding w added for two sites. In FY 97 the program was authorized for three additional sites. The Governor asked for additional funding in FY 98 for two additional sites. The Subcommittee approved one additional site. He observed additional sites were added with federal funding in FY 97. He observed that sites begun with federal funding will have to be reduced. He expressed concern that additional sites were added without legislative authorization. The sites are i Juneau, Anchorage, Dillingham, Wasilla, Bethel, and Fairbanks. Ms. Clark noted that grants are competitively awarded. A roll call vote was taken on the MOTION to adopt Amendment HSS-7. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Davis, Foster, Kelly, Kohring, Martin, Therriault, Hanley Representative Mulder was absent from the vote. The MOTION FAILED (3-7). Amendments HSS 8-10 were WITHDRAWN. Representative Moses MOVED to adopt Amendment HSS-11 (copy on file). Co-Chair Hanley MOVED to AMEND Amendment HSS-11 by reducing the amendment from $333.3 thousand dollars to $170 thousand dollars. He observed that the amendment woul add back $170 thousand dollars to the McLaughlin Youth Center. He observed tha the Department of Health & Social Services' budget would remain within its cap. (Tape Change, HFC 97-77, Side 2) There being NO OBJECTION, Amendment HSS-11 was amended. There being NO OBJECTION, Amendment HSS-11 was adopted as amended. Amendments HSS 12-15 were WITHDRAWN. Representative Grussendorf MOVED to adopt Amendment HSS-16 (copy on file). Co- Chair Hanley noted that the amendment would fit within the Department's cap. T amendment would add $39.2 thousand dollars for the Fairbanks' health lab. Ther being NO OBJECTION, it was so ordered. Amendments HSS-17 & 18 were WITHDRAWN. Co-Chair Hanley MOVED to adopt intent language contained in Amendment HSS-19 (copy on file). He observed that the intent is to estimate the growth rate of formula programs within the Department of Health & Social Services. The intent language would clarify that the growth rate assumption is 7 percent for FY 98. He stated that if the actual growth rate is beyond 7 percent he would be willi to negotiate with the Department. He stated that he wants the Department to manage the dollars in order to keep the growth rate down. He stressed that it is not his intention that the Department be forced to go further up the options list. He stated that it is the intent that the Department go down the list to provide some of the options not now covered, such as eyeglasses, hearing aids a dental services. He observed that the Subcommittee requests that the growth ra in community mental health centers be flat. He observed that the total spendin for community health centers in FY 94 was $12 million dollars. The FY 97 estimate is $29 million dollars for community health centers. In response to a question by Representative Grussendorf, Co-Chair Hanley stated that if the baseline growth rate exceeds 7 percent that there would be a supplemental appropriation. Representative Martin expressed concern with state support for abortion. Ms. Clark observed that the Governor's budget did not included an increment for general growth in the medicaid program. She observed that the Department is trying to absorb $20 million dollars in the medicaid program. She noted that t Department supports the amendment. There being NO OBJECTION, Amendment HSS-19 was adopted.