HB 177-REVISED PROGRAM: APPROPRIATIONS  11:00:12 AM CHAIR KREISS-TOMKINS announced that the next order of business would be HOUSE BILL NO. 177, "An Act relating to an increase of an appropriation due to additional federal or other program receipts; and providing for an effective date." CHAIR KREISS-TOMKINS opened public testimony on HB 177. He ascertained that there was no one who wished to testify and closed public testimony. 11:00:53 AM REPRESENTATIVE CHRIS TUCK, Alaska State Legislature, explained that an amendment to HB 177 would be offered to ensure the legality of the bill. He offered that the Legislative Budget and Audit Committee should be prohibited from acting on behalf of the entire legislature "carte blanche." He stated that the amendment would provide increments of funding for which JBUD may act without the entire legislature. He stated that, currently, should the Legislative Budget and Audit Committee choose not to act on a Revised Program Legislative (RPL), then the governor is permitted to act after 45 days had passed. He added that the 45-day limit would exist for any RPL request in the amount of $20 million or less; a 90-day limit would exist for amounts between more than $20 million and up to $50 million; a 180-day limit would exist for amounts between more than $50 million and $100 million; and amounts more than $100 million would have a nine-month limit to ensure that the whole legislature may convene. 11:02:57 AM CHAIR KREISS-TOMKINS moved Amendment 1, labeled 32-LS0369\A.1, Marx, 2/12/21, which read as follows: Page 1, line 12, through page 2, line 8: Delete all material and insert: "(2) [45 DAYS SHALL ELAPSE BEFORE COMMENCEMENT OF EXPENDITURES UNDER THE REVISED PROGRAM] unless the Legislative Budget and Audit Committee earlier recommends that the state take part in the federally or otherwise funded activity, the governor may not expend the receipts under the revised program until the following periods have elapsed: (A) 45 days for expenditures not exceeding $20,000,000; (B) 90 days for expenditures greater than $20,000,000 but not exceeding $50,000,000; (C) 180 days for expenditures greater than $50,000,000 but not exceeding $100,000,000; (D) 270 days for expenditures greater than $100,000,000; (3) should the Legislative Budget and Audit Committee recommend within the applicable period described in (2) of this subsection [45-DAY PERIOD] that the state not initiate the additional activity, the governor shall again review the revised program and if the governor determines to authorize the expenditure, the governor shall provide the Legislative Budget and Audit Committee with a statement of the governor's reasons before commencement of expenditures under the revised program." REPRESENTATIVE KAUFMAN objected. 11:03:07 AM REPRESENTATIVE VANCE asked for an explanation of the number of days and dollar amounts proposed in the amendment. REPRESENTATIVE TUCK answered that $1.6 billion had been proposed via RPLs to the Legislative Budget and Audit Committee and had exceeded all parties' intent of applying the legislative process to such [large] amounts. He stated that litigation had occurred and had resulted in an injunction but had left the matter unresolved. He stated that the legislature is the appropriating body, and the governor administers what the legislature appropriates for him/her to use. He stated that the dollar amounts had been based somewhat arbitrarily on historically typical amounts presented to the committee by means of the RPL process to address larger amounts. 11:05:39 AM REPRESENTATIVE KAUFMAN asked whether it had been considered to add language to adjust for future inflation. REPRESENTATIVE TUCK answered that it had been considered, but that there exist difficulties in arriving at a consensus for inflation-proofing language. CHAIR KREISS-TOMKINS acknowledged that such difficulties exist and expressed his frustration that the need to revisit the language would emerge. REPRESENTATIVE CLAMAN offered that some work had been conducted to include inflation-proofing in criminal statutes and that there had been difficulties in arriving at a consensus regarding complex language. He echoed the frustration expressed by Chair Kreiss-Tomkins. CHAIR KREISS-TOMKINS expressed his willingness to attempt to include inflation-proofing language. REPRESENTATIVE CLAMAN referred to subparagraph (d) in the proposed amendment and asked whether, if the governor received $125 million in additional federal funds, then he/she would submit an RPL; further, if the Legislative Budget and Audit Committee took no action within the proposed 270 days, then the governor would be permitted to spend the money. REPRESENTATIVE TUCK confirmed Representative Claman's hypothetical rhetorical question as correct and added that it would be likely that the legislature will have been in session during the 270 days and could appropriate the money. REPRESENTATIVE CLAMAN suggested that a scenario may exist in which the governor could receive funds 130 days after the legislature convenes and would allow a short amount of time for the governor to spend the money. REPRESENTATIVE TUCK explained that, should the money be received 130 days [following the convening of the legislature,] there would be an additional 270 days, for a total of 400 days. He stated that this is more than a year, and the legislature would reconvene. REPRESENTATIVE STORY reflected on concerns that had been expressed to her office requesting inflation-proofing to be included in many types of legislation. 11:08:50 AM REPRESENTATIVE VANCE expressed her understanding that the proposed bill would slow the process and ensure that the legislature retains its appropriation authority in cooperation with the executive branch and asked Representative Tuck to reflect on the public's expressed wish that the process be as expedient as possible. REPRESENTATIVE TUCK answered that there had been $300 million funds received for small business relief that had not been taken up [by the Legislative Budget and Audit Committee.] He added that an additional $10 million had been set aside for Alaska Housing Finance Corporation to use for rent relief. He said that the $10 million was the only legal and clean RPL [associated with CARES Act funds] since the program was already in existence. He stated that the $300 million had been issued to members of the public even in the absence of the RPL process and suggested that the proposed bill would enable additional dialogue between the governor and the legislature and would allow the governor to submit RPLs for smaller amounts. 11:11:29 AM The committee took an at-ease from 11:11 a.m. to 11:15 a.m. 11:15:56 AM REPRESENTATIVE VANCE asked whether the dollar amounts represented individual expenditures or total dollar amounts. REPRESENTATIVE TUCK answered that the amounts would be associated with the RPL. He offered an example that the governor may request an RPL for a smaller amount so that the total could be considered by the legislature and the program evaluated for effectiveness. REPRESENTATIVE CLAMAN noted that COVID relief was represented in the supporting documents in fiscal years (FY) 21 and 20 and asked for an explanation of the purpose of a $5 million RPL listed under FY 18. REPRESENTATIVE TUCK answered a $500 million RPL had been for Medicaid expansion. REPRESENTATIVE CLAMAN complimented the structure as explained that would encourage smaller dollar amount and more specific requests. CHAIR KREISS-TOMKINS expressed his agreement with the comment made by Representative Claman. 11:19:14 AM REPRESENTATIVE KAUFMAN removed his objection. There being no further objection, Amendment 1 was adopted. REPRESENTATIVE CLAMAN expressed his satisfaction with the bill as amended and declined the offer made by Chair Kreiss-Tomkins to further hold the bill in committee. REPRESENTATIVE KAUFMAN expressed his wish to hold the bill in committee for further review if it was the will of the committee. 11:21:01 AM CHAIR KREISS-TOMKINS announced HB 177 was held over.