HB 292-GRANTS TO DISASTER VICTIMS  9:43:07 AM CHAIR LYNN announced that the final order of business was HOUSE BILL NO. 292, "An Act relating to grants to victims of a disaster in this state; and providing for an effective date." 9:43:43 AM McHUGH PIERRE, Deputy Commissioner/Chief of Staff, Office of the Commissioner/Adjutant General, Department of Military & Veterans Affairs, presented HB 292 on behalf of the House Rules Committee, sponsor by request of the governor. He said the department gives out two disaster-related grants. One is for public assistance, for example, to cover public utilities or city infrastructure after a declared disaster. The other grant is given to individual households and has a cap of $5,000. That cap has not changed since 1977. Mr. Pierre noted that $5,000 in 1977 is equal to $18,000 in 2010. The proposed bill would adjust the amount of the cap to connect it with the consumer price index; it would be half of what the federal government gives out during a disaster, which he opined is a reasonable amount of money. Mr. Pierre deferred to Mr. O'Hare for further details. 9:45:26 AM MIKE O'HARE, Deputy Director, Division of Homeland Security/Emergency Management, Department of Military & Veterans Affairs, offered information regarding HB 292, on behalf of the House Rules Committee, sponsor by request of the governor. He stated that the proposed legislation would modernize the individual assistance grant program to the current economy. He said the department set up a multi-agency task force to determine what, if any, increase is needed. The [task force] was comprised of a diverse group of individuals, including those from: the Department of Commerce, Community, & Economic Development, the Department of Health and Social Services, Alaska Voluntary Organizations Active in Disaster (AKVOAD), the Alaska Housing Finance Corporation, the American Red Cross, the United States Department Agriculture (USDA), and rural organizations. The model formulated by the task force would make the grant cap half of the federal individual assistance, which fluctuates with the economy through the consumer price index. Currently, the maximum for the federal individual assistance grant is approximately $30,000; therefore, the proposed grant from the State of Alaska would be approximately $15,000. 9:47:37 AM MR. O'HARE said this proposed legislation came about after the devastating floods in Interior Alaska in 2009, which affected 40 communities along the Yukon-Kuskokwim Rivers. These residents, he reported, received federal individual assistance up to the $30,000 maximum. He said there were approximately 30 victims of the disaster in those communities who were not eligible because they were not in that federally declared zone, and all the State of Alaska was able to give those people was $5,000, which was insufficient. Mr. O'Hare reiterated that under the proposed legislation, during a state-declared disaster, the governor would be allowed to provide up to half the [amount of the federal] individual assistance grant program to those affected in the disaster. 9:48:39 AM MR. PIERRE emphasized that the state adheres to a strict and stringent process by which it hands out the grant money. For example, people are not automatically given the maximum amount. Of the households affected in a disaster, about 30 percent receive the maximum allowable amount, which Mr. Pierre reiterated is currently $5,000. He explained that the money is given in an effort to get people back on their feet to rebuild their homes and lives. He offered further details related to the determination of how much money a person is awarded. A person who has money in the bank and is prepared for a disaster may not receive any money at all, for example. 9:49:36 AM MR. O'HARE said the department interviews victims and reviews photographs to determine whether the victim does not have the capability to make him/herself whole again without financial help. 9:50:24 AM REPRESENTATIVE GRUENBERG related his understanding that there have been no claims under the state fund since the first of 2010. He then opined that it is not enough to increase the amount given by the state to one half of that given by the federal government. He said the people who need money have been "wiped out" and are left with nothing. He asked why the cap is proposed to be half, and he said he is prepared to offer an amendment to increase the amount to "the maximum." 9:51:12 AM MR. O'HARE answered that the concept of state declared disaster is "a smaller version of a federally declared disaster." Furthermore, state declared disasters happen more often. He stated that the concept of giving money is an opportunity to help in part of the process of a victim being whole again. 9:52:09 AM MR. PIERRE added that the money the state pays comes through its disaster relief fund, which is not supported by the federal government. It would not be until a federal disaster is declared that the State of Alaska would receive federal support, and then it would be federal dollars that would be given as individual assistance to the victims. He stated, "A household ... could not double-dip." REPRESENTATIVE GRUENBERG remarked that the fiscal note is about $600,000. 9:52:57 AM MR. O'HARE, in response to Representative Gruenberg, said the fiscal note is speculative, because disasters cannot be anticipated. He said the fiscal note reflects the increase from the original $5,000 to an approximate $15,000. He indicated that in one disaster, only 30-35 percent of applicants qualified for the maximum $5,000. The aforementioned taskforce has said the best model to follow would be half of the federal amount. 9:54:46 AM MR. PIERRE, in response to Representative Gruenberg, emphasized that the numbers of disaster victims affected would not be changed by the proposed legislation. The numbers showing on the fiscal note, he said, have been a good average since 2002. He said changing the amount of the state's grant cap to equal that of the federal grant would double the fiscal note. He related that Alaska experiences 5-6 state disasters per year, and he reiterated that not all of those disasters are eligible for federal assistance. To illustrate his point, Mr. Pierre relayed that in 2009, there were two disasters declared by the President of the United States, while Alaska declared 3-4 state disasters. Mr. Pierre stated that the one federally declared disaster was a mud slide in Kodiak that was "not eligible for individual assistance" - it was "only a public assistance disaster." MR. PIERRE explained that in some disasters, only public assistance - for roads and utilities - is awarded; public assistance, he reminded the committee, is not awarded for damage of individual homes. The bill addresses those who have experience damage to their homes. He said the department heavily emphasizes being proactive with the community and lending a hand, rather than a full handout. He said there are representatives from the department who travel to communities that typically experience flooding to ask residents if they have followed prevention tactics. The emphasis is in ensuring the safety of these people. 9:57:22 AM MR. PIERRE, in response to Representative Seaton, confirmed that the fiscal note reflects the difference between the current average and the proposed amount. MR. O'HARE, in response to Representative Seaton, related that in the past two-three years, the Alaska State Legislature had the vision to forward-fund the disaster relief fund. Currently, there are approximately $100,000 left in that fund. He added that the department must obtain permission from the legislature to spend more than $1 million per disaster. The department has "a very good measure of capping expenditures" and a responsibility to provide its finance plan to the legislature. 9:59:27 AM MR. PIERRE, in response to a concern expressed by Representative Gatto, said the state is not discriminating between rural and urban residents. He explained that there are two types of disasters described in statute: AS 26.26, which addresses natural disasters, and AS 26.44, which addresses economic disasters. He said economic disasters are handled by the Department of Commerce, Community, & Economic Development. Communities that experience disaster file a declaration to the state. The state analyzes the declaration, and, if warranted, holds a disaster policy cabinet to determine whether or not to declare a state disaster based on the local response. The state would ask the federal government for help once it has spent all its resources. MR. O'HARE, in response to a hypothetical example of a chemical spill disaster offered by Representative Gatto, echoed Mr. Pierre's outline of the steps that would be taken, first by the community, next by the state, and finally by the federal government, as necessary. He stated, "What we're talking about here is ... individual assistance for the recovery of the disaster." If the chemical spill had resulted in the death of family members, the state could give money to help pay for funeral costs. If the hypothetical spill had affected the homes, the grant money could be applied. 10:03:46 AM CHAIR LYNN announced that HB 292 was held over.