SENATE BILL NO. 76 "An Act relating to long-term plans of certain state agencies and recommendations regarding elimination of duplication in state agency functions." SENATOR SEAN PARNELL stated that SB 76 would enact Results Based Government to help better serve Alaskans. SB 76 would revise the Executive Budget Act to require the Legislative and Executive branches to more clearly focus on results through policies established by the Legislature and executed by the Governor. The Legislature would establish policy by issuing mission statements and indicating the desired results for state agencies to achieve. Senator Parnell advised that to accomplish this, the Legislature would need to identify desired results and establish priorities for each agency, assign accountability, and require methods for measuring, reporting and evaluating these results. The results would be reported quarterly to the Legislature to ensure continued oversight. Senator Parnell spoke to how the legislation would work. He noted that the Legislature establishes policy by enacting it into law. The mission statement for most agencies is enacted by statute, and that mission statements could be enacted by passing laws. The language of the legislation stipulates to be "open enough" to allow and set forth the mission statement. He emphasized that the mission statement must be consistent with the Alaska Statutes. Co-Chair Therriault inquired if this legislation would fit with the process which the House had implemented this year in working with agencies to determine their mission. Senator Parnell stated that the bill would track the current process and then with the legislation in place, there could be flexibility so that the Legislature would not be locked into the same process and measures each year. Senator Parnell recommended that this issue could occur through implementation of statute or through the intent language of the budget bill. That language would allow the purpose not currently in statute to be considered. Representative J. Davies agreed with the intent of the proposed legislation. He voiced concern with the timing and tone. He noted that the effect of this process had just begun and recommended that it would be better to wait until there was history of how efficiently it had worked. He added, the tone has the effect of "jamming something down someone's throat". He proposed that is not an option in trying to create a cooperative process. Senator Parnell stated that this was his third attempt in trying to pass the legislation. This proposal differs from the other two, as it is more focused on results rather than planning while also providing flexibility. He defended the legislation's tone, noting that he had tried to work cooperatively with the Administration while preparing it. Representative Grussendorf suggested that the legislation could work with a two-term governor, which he predicted would happen this year. Senator Parnell replied that micro-management of any budget system makes it become unworkable. Representative J. Davies spoke again to the tone of the proposed legislation. He pointed out that the legislative branch establishes policy while the executive branch is elected by the entire state. He suggested that there is an overlap of responsibilities in developing the agency's mission. The legislative branch does not have a tremendous amount of experience in how agencies work. There is a certain understanding of that which is required to correctly characterize the way a mission statement ought to be phrased. He stressed that the legislation does not invite the executive branch to participate in a balanced manner . Representative J. Davies submitted that there is a tremendous amount of work to be done in order to determine the appropriate measures to create "effectiveness". He was concerned that if this legislation was passed, the next budget would require that every effectiveness measure be in place. Representative J. Davies requested that this measure move more slowly through the Committee. Senator Parnell replied that there is a definite role for the Governor in this proposed process. He stressed that the process had been established as an invite to participate. RICHARD VITALE, STAFF, SENATOR SEAN PARNELL, commented that the legislation would not be binding to any specific number of measures set forward, nor would they be carried forward to the next year. He noted that the missions had been established and that the legislation should now go forward. Mr. Vitale pointed out that the first vetoed legislation had been designed to request the Governor to work with the Legislature before submitting the budget. He pointed out that to date, the Legislature has come forward with the mission measures. Representative J. Davies noted that on Page 3, Line 20, it was stated that: "The budget must be accompanied by the information required under..."; Page 5, Line 27, states that: "Each agency shall". He elaborated, this language expects that every agency will develop all missions and measures and that the Governor "must" submit that information in the next budget cycle. Senator Parnell responded that the agencies agree that they already provide that work and do collaborate on the budget summary book. He advised that this would not be new work. Representative J. Davies believed that there is a difference between what the legislation requires and what currently is being done. He voiced concern that there is not enough time allowed for implementation of this legislation. Representative Kelly asked how this legislation was different from that passed two years ago. Senator Parnell replied that the past legislation focused more on planning and requiring a five-year long range plan in addition to performance based budgeting. The proposed legislation strictly focuses on the result-side, removing the five-year planning requirement. JIM BALDWIN, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF LAW, offered the following comments regarding CSSB 76(RLS). 1. Proposed section 37.07.014(a), set out in Section 1 of the bill, provides that it will be the responsibility of the Legislature to "issue" a mission statement for each agency. That description of legislation activity is ambiguous and should have further clarification. The power of the Legislature is to set policy through exercise of its law-making power. That power is exercised by enacting bills into law. It is not clear from the bill how the Legislature would establish a mission statement for an agency. Mr. Baldwin foresaw disputes arising between the executive and legislative branches of state government if the Legislature attempts to establish mission statements as a rider to a general appropriation bill. According to the Alaska Constitution, "bills for appropriations shall be confined to appropriations". Provisions inserted in the appropriation bills to establish mission statements would violate the confinement provision. He continued, to a certain extent, the enabling act for each agency determines its mission. The Legislature has plenary power to change enabling acts to direct the activity of agencies. This is the manner in which the Legislature sets policy. However, the Legislature departs from its lawmaking role when it attempts to execute the law. The establishment of a mission statement represents an executive responsibility. To the extent that the Legislature does not agree with a mission statement, the Legislature would amend the enabling act to either authorize or prohibit the conduct associated with the performance of a mission. If general law does not authorize a mission, the agency's enabling act cannot be supplemented by something included in an appropriation bill. 2. Proposed section 37.07.016, implies that the mission statement will "guide" the governor in his execution of law. As mentioned above, the binding nature of the guidance would be questionable if the mission statements are not enacted in general law. The governor is guided first by the Alaska Constitution and second by statute in the exercise of his executive powers. 3. The repeal of AS 37.07.080(g)(2) set out in Section 9 of the bill appears consistent with State v. Fairbanks N. Star Borough. Mr. Baldwin recommended checking legislation in other states and then creating something more cohesive. JACK FARGNOLI, SENIOR POLICY ANALYST, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, questioned how the legislation would be put in place and made to work. He agreed that "performance based budgeting" is a good direction to go in, although, he recommended that it should be done without putting a burden on an already overstrained process. Mr. Fargnoli suggested that the meaning of the word "issue" in the mission statement could narrow that which is already established in law. He noted it had been left unsettled in the bill, pointing out that on Page 4, Line 20 & 26 with reference to "established". He asked if that was intended to coincide with the work "issue". If it was the same as already established in law, it would imply the entirety of the agency's mission would require a larger body of information to accompany it. Mr. Fargnoli stressed that there is a fundamental ambiguity regarding how much information was being required. (Tape Change HFC 98- 87, Side 2). Mr. Fargnoli continued, another issue which falls into the same category as mechanical problems, would be the concern with separation of powers. He advised that in reviewing past history of intent language, it would seem a better choice to first address the mechanical problems. He agreed that the intent of the legislation was a good process and that he did not want to see it fail. Mr. Fargnoli suggested that the "kinks" could be worked out if the Legislature does not act too quickly and that perhaps a working group could be formed to address the concerns. Representative J. Davies noted that there was a zero fiscal note prepared by the Senate Finance Committee. He asked if the other departments had prepared fiscal notes. Mr. Fargnoli commented that there were a number of fiscal notes developed by the departments in the original version of the bill. When the bill got changed to it's current form, moving away from the five-year process, the departments revisited the question of fiscal impact. A subsequent fiscal note was submitted, accompanied by a memo from the Director of OMB specifying that the magnitude and composition of the impacts would depend on how the legislation was implemented, and that the fiscal impact would presumably be large, although, impossible to predict. Representative Grussendorf reiterated that the mechanical workings of the legislation appeared to be cumbersome and vague. He pointed out that Page 4, Section 4, would require quarterly reports specifying the measures. He addressed the amount of agency energy required to prepare, analyze and provide the quarterly information. Mr. Fargnoli acknowledged that there is some degree of budget development effort which would be supplanted through current legislation, although, the Administration believes that the effort required would be substantial. CS SB 76 (RLS) was HELD for further consideration. HB 364 HOUSE BILL NO. 364 "An Act requiring nonresident hunters to be accompanied when hunting moose; and providing for an effective date." TELECONFERENCE TESTIMONY ONLY VIRGIL UMPHENOUR, (TESTIFIED VIA TELECONFERENCE), FAIRBANKS, testified in full support for HB 364 which he felt would help to solve proposed moose hunting problems. He voiced concern regarding the non-resident moose hunters orientation program. He recommended that the course be patterned in a similar manner as the bear-baiting course provided by the Department of Fish and Game and the Department of Public Safety. A course like this could help in identifying the appropriate moose to be taken and then how to deal with the meat of an animal which weighs over 2,000 pounds. COL. JOHN GLASS, (TESTIFIED VIA TELECONFERENCE), DIVISION OF WILDLIFE, DEPARTMENT OF FISH AND GAME, commented that the Division is in support of the bill and the accompanying amendment submitted by Representative Ivan. [Copy on File]. HB 364 was HELD in Committee for further consideration. SENATE BILL NO. 76 "An Act relating to long-term plans of certain state agencies and recommendations regarding elimination of duplication in state agency functions." Representative Grussendorf requested that a fiscal note be provided by the Administration before the bill is moved from Committee. Senator Parnell noted concern with a statement made by Assistant Attorney General Baldwin regarding the legislation trying to manage the executive branch powers, when in fact the legislation establishes the Governor's primary duty to carry out the executive power under Article 3 of the Alaska Constitution. The Legislature's role is merely to set the policy and overall mission. He felt that the legislation could supplant work required of the Office of Management and Budget (OMB), changing the way business currently is being done. Senator Parnell advised that to date, OMB has submitted no amendments. He emphasized that he is open to recommendations to make the legislation more effective. Representative Grussendorf asked if it would work for an agency to submit reports biannually instead of quarterly. Senator Parnell stated that he would have no problem making the report due twice a year. He stressed that the key intention would be to receive some reporting during the interim, whereas, having only an annual process removes a large part of the accountability. Senator Parnell offered to work with member's amendments on the floor, requesting that the bill keep moving through Committee. Representative Grussendorf discussed that it would not be in the best interest of the Committee for the legislation to pass from the House Finance Committee without the appropriate fiscal note accompanying it. Co- Chair Therriault noted that the bill would not be able to move from Committee at this time without the Minority member's support. Representative G. Davis voiced concern with the quantity of unread reports descending upon the Legislature. He recommended that the reports be submitted to the Legislative Finance Division and available upon request to interested parties. CS SB 76 (RLS) was HELD in Committee for further consideration.