SB 310-EMPLOYMENT OF PRISONERS CHAIR ANDERSON announced that the final order of business would be SENATE BILL NO. 310, "An Act relating to the employment of prisoners; and providing for an effective date." 4:25:35 PM DARWIN PETERSON, Staff to Senator Lyda Green, Senate Finance Committee, Alaska State Legislature, sponsor, noted that SB 310 was introduced at the request of the Department of Corrections (DOC). He explained that the intent of the bill is to reinstate the Alaska Correctional Industries program, which was sunsetted along with the Correctional Industries Commission, in July of 2005. This legislation, he said, would reestablish and improve the aforementioned program. He went on to say that the department would have the authority to participate in federal Prison Industry Enhancement (PIE) programs in addition to actively participating and partnering with private enterprises. In regard to the cost of the program, he said that the program will be funded through program receipts. Furthermore, SB 310 promotes prisoner responsibility and accountability by enabling the department to deduct confinement costs from inmates' wages. These deductions, he said, may be used for child support payments, victim restitution, criminal fines, civil judgments, fees for utilities while incarcerated in addition to other obligations. He said "this is a vital piece of legislation ... if the state of Alaska wants to continue using prison employment as a tool for rehabilitation." 4:27:12 PM CHAIR ANDERSON noted that he was previously on the DOC subcommittee. Initially, he said, there was concern regarding compensation for inmates; however, he spoke with the commissioner who explained the importance of the program. He opined that this program is "critical" to keep the [prison] environment civil. MR. PETERSON stated his agreement and highlighted furniture building programs and laundry programs, which are important for rehabilitation. 4:28:47 PM REPRESENTATIVE LYNN asked if there is any possibility of jobs being taken from "law-abiding citizens." MR. PETERSON replied no, adding that the Senate Finance Committee and the labor unions worked to find a compromise, and an amendment was adopted in the House State Affairs Standing Committee to add language to ensure that this would not occur. He explained that before authorizing a contract to conduct work with a private organization the commissioner must consult with the labor unions. CHAIR ANDERSON acknowledged members of the labor unions in attendance, and noted their support of SB 310. 4:30:00 PM REPRESENTATIVE CRAWFORD expressed concern regarding contracted work, and asked how the department would compensate for changes in the workforce. In addition, he inquired as to the length of the contracts between the department and the labor unions. MR. PETERSON replied that without seeing contract language, he would be unable to answer the question regarding contract dates; however, he surmised that the labor unions would not want the contract to continue over an extensive period of time. 4:32:02 PM CHAIR ANDERSON commented that [the length of contracts] is a regulatory interpretation, not a statutory interpretation. He said that in order to have the labor unions' support of the bill, the aforementioned issue needed to be addressed. He surmised that the contracts would most likely be for a short time, with the option of voiding the contract, if necessary. REPRESENTATIVE CRAWFORD said that he would like to see guidelines for the contracts. MR. PETERSON replied that the department may have an interpretation of the current regulations which may address this issue. 4:33:12 PM REPRESENTATIVE ROKEBERG, referring to page 3, Section 2, asked why the language regarding the impact on private industry was removed. He opined that "private organization" does not indicate this level of consultation. In response to a comment, he clarified that previously, the bill applied to both private an public sector contracts; however, it appears to now focus on union contracts. MR. PETERSON explained that the aforementioned amendment was intended to "raise the bar" for both the public and private sector. The commissioner would consult with local organizations to ensure that the contract does not result in the displacement of employed workers. He stated that this would apply to both private sector and labor union employees. He added that if this language is not specific enough, the sponsor would support more specificity; however, it is the sponsor's belief that the current language is appropriate. 4:35:31 PM REPRESENTATIVE ROKEBERG questioned the involvement of a "private organization." REPRESENTATIVE GUTTENBERG, referring to page 6, Section 9, asked for an explanation of the intent of this section. MR. PETERSON replied that [AS 37.05.146(c)] applies to program receipts. He explained that Section 9 includes language to ensure that revenue from the program may be used as its funding source. SHARLEEN (SHAR) GRIFFIN, Director, Central Office, Division of Administrative Services, Department of Corrections (DOC), clarified that Section 9 is intended to support the Prison Industries Enhancement program (PIE), which is through the Bureau of Justice Assistance (BJA), and is monitored by the Correctional Industries Association. She said that this program has many regulations that must be followed. She explained that this program requires the inmates be paid the prevailing wage, which must be obtained through the Department of Labor, along with working with union organizations to ensure that there is no unfair competition. Paying prevailing wage, she said, allows one deduction for the offender to pay part of the cost of incarceration. She said that the money would go to support the program in which the inmate is working. 4:38:02 PM MS. GRIFFIN, in response to a question, said that prevailing wage is being used instead of minimum wage so as to not create unfair competition with private industries. REPRESENTATIVE GUTTENBERG asked what types of jobs would be available [with the PIE program]. MS. GRIFFIN replied that this would depend on the private vendor. The PIE is required if the contract is with a vendor that transports and sells goods across state lines. Currently, she said, 34 states are involved in this program. 4:39:55 PM MS. GRIFFIN, in response to a question, said that currently, there are no contracts that transport and sell goods across state lines. CHAIR ANDERSON asked if any prisoner can work, regardless of the violation. MS. GRIFFIN replied no. She said that the inmate's classification must fit the job for which the inmate applied. These classifications are: minimum security, medium security, maximum security, and close security. REPRESENTATIVE LEDOUX, referring to page 3, Section 2, in regard to the commissioner consulting with local union organizations, inquired as to what would happen if a job in question is not a union position. MS. GRIFFIN replied that the types of jobs the department would participate in would be the types of activities that can be done within the confines of an institution, which "drastically limits" what can be done. She stated that inmates would not be sent outside of the facility to work. For example, she said, a vendor may wish to set up an auto-body shop and teach inmates to do auto-body work. 4:42:56 PM REPRESENTATIVE LEDOUX asked if auto-body work is a union trade. MS. GRIFFIN replied that she does not believe so, but would defer to the union representatives to answer this question. REPRESENTATIVE CRAWFORD said that some auto-body shops are union; however, most are not. REPRESENTATIVE ROKEBERG, referring to page 5, Section 7, subparagraph (b), asked if the prevailing wage is the current standard. MS. GRIFFIN replied that the prevailing wage only applies to the PIE, and can be found on page 4, Section 6 of the bill. 4:45:55 PM MS. GRIFFIN, in response to a question, clarified that if the department signed a contract with a vendor who wanted to build office furniture and sell it across state lines, this would need to be a PIE program in order for the state to participate. MS. GRIFFIN, in response to questions, stated that SB 310 contains retroactive clauses. If the legislation does not pass, she said, the department will not be able to continue the PIE program, in addition to having working inmates. REPRESENTATIVE KOTT inquired as to the current statewide average cost of confinement. MS. GRIFFIN replied that the average is $107.42 per day, which includes all costs. In response to an additional question, she clarified that if the compensation is 50 percent or more of the minimum wage established, the commissioner may make deductions "up to the cost of care." 4:48:43 PM REPRESENTATIVE ROKEBERG expressed concern regarding the types of private contractors that would be considered. CHAIR ANDERSON suggested that this question be answered before the next committee of referral. 4:49:31 PM REPRESENTATIVE KOTT moved to report HCS SB 310(STA) out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HCS SB 310(STA) was reported from the House Labor and Commerce Standing Committee.