SB 95-SEARCH AND RESCUE SURPLUS STATE PROPERTY  3:39:21 PM CHAIR KREISS-TOMKINS announced that the next order of business would be CS FOR SENATE BILL NO. 95(STA), "An Act relating to the right of first refusal of a volunteer search and rescue group with respect to obsolete or surplus state property." 3:39:42 PM SENATOR DAVID WILSON, Alaska State Legislature, prime sponsor, introduced CSSB 95(STA). He paraphrased the sponsor statement, which read as follows [original punctuation provided]: Search and rescue operations across the State of Alaska are largely done by volunteer organizations dispatched by the Alaska State Troopers. These groups provide lifesaving services to our state at minimal cost. SB 95 provides assistance to the groups at no cost to the state. While search and rescue groups can be reimbursed for costs incurred during specific operations, the state does not generally provide them with equipment. This legislation allows a volunteer search and rescue organization to exercise the right of first refusal on items related to search and rescue before the property is sold, leased, licenses, or disposed of. Right of first refusal means the organization can buy the equipment at a fair market value set by the department of administration. This bill enables these volunteer search and rescue groups to more easily obtain the equipment they need to fulfill their lifesaving mission. Thank you for your consideration of this important legislation. 3:42:22 PM JASMIN MARTIN, Staff, Senator David Wilson, on behalf of Senator Wilson, prime sponsor, summarized the intent of the bill and presented a sectional analysis of CSSB 95(STA) [included in the committee packet], which read as follows [original punctuation provided]: Section 1: Names this act the Ellie Mae Act. Section 2: Amends AS 44.68.110 to allow an organized volunteer search and rescue group to exercise right of first refusal for surplus state items related to search and rescue before they are disposed of by the state. 3:44:11 PM MARK STIGAR, President, Alaska Search and Rescue Association, explained that the goal of the legislation was to allow the volunteer search and rescue groups to fulfill their purpose as easily as possible by making equipment available to them. He explained that the groups were made up of volunteers and relied entirely on fundraising, as they didn't receive any money from state entities. REPRESENTATIVE VANCE asked how these groups were defined in statute and whether they were required to meet certain criteria so that they weren't receiving an unfair advantage over other groups. MR. STIGAR shared his understanding that the search and rescue operations groups were identified by a resource list maintained by the Alaska State Troopers (AST). SENATOR WILSON directed attention to page 1, lines 8-10, which defined the groups as "A group of volunteers that is organized to provide search and rescue services in the state, including participation in a search and rescue party under AS 18.60.120". 3:49:08 PM REPRESENTATIVE KAUFMAN wondered whether procurement items could be influenced by those receiving the first option to refuse. MS. MARTIN assured Representative Kaufman that state property was disposed of by the Department of Administration (DOA) in the best interest of the state; further that the responsibility was taken very seriously. 3:50:16 PM CHAIR KREISS-TOMKINS asked how common it was for personal property to be used to execute the missions carried out by the search and rescue organizations. MS. MARTIN deferred to Mr. Stigar. MR. STIGAR estimated that at least 90 percent of the property was personal property. For example, he said all of the 25 search and rescue canines were "personal property" of their handlers. He said the exception was a small number of radios provided by the state. CHAIR KREISS-TOMKINS asked how DOA would interpret the language on page 1, line 8. 3:53:11 PM THOR VUE, Chief Procurement Officer, DOA, attempted to clarify the question. CHAIR KREISS-TOMKINS asked how to determine which entities were eligible and which individuals in said entities were eligible. MR. VUE explained that DOA worked closely with the Department of Public Safety (DPS) to ensure that the organizations were recognized. In regard to individual eligibility, he imagined that officers within the eligible entities would be selected as the organizations' representatives. CHAIR KREISS-TOMKINS asked how DPS would assess which entities were eligible, should the legislation pass. 3:55:12 PM PAUL FUSSEY, Lt., Alaska State Troopers, DPS, stated that he would work closely with Mr. Vue to establish the appropriate qualifications. 3:55:54 PM REPRESENTATIVE EASTMAN asked whether loans should be added to the list on page 1, line 12, of the bill. MS. MARTIN pointed out that "leased" was included in the list, which could capture the intent described by Representative Eastman. She recalled a discussion that took place in the Senate Finance Committee about making this a leasing program; however, the property in question would be past its valuable life, so keeping it as inventory would no longer benefit the state. REPRESENTATIVE EASTMAN asked whether it was the bill sponsor's intent for a volunteer group to have priority over a borough search and rescue team. MS. MARTIN answered yes, the bill would apply to volunteer organizations. She reasoned that organizations with a payroll have more resources and wouldn't necessarily need to purchase state equipment at a reduced cost. 3:58:51 PM REPRESENTATIVE STORY asked how big the surplus [of equipment] was and whether other groups should be included in the scope of the bill. SENATOR WILSON opined that the bill would be a "nominal" way for the state to assist search and rescue groups at zero cost. He said his intent was to help search and rescue groups across Alaska that were in need of goods and services, which the state would typically donate. REPRESENTATIVE STORY requested a response from DOA. 4:01:05 PM JOHN HARSHFIELD, State Property Manager, Shared Services of Alaska, DOA, reported that between 30-50 items were posted per day. The auction averaged 300 items at any given point, he said. 4:02:34 PM REPRESENTATIVE EASTMAN directed attention to the language "state property that may assist in carrying out search and rescue services". He asked who was being granted the authority to make that determination. MS. MARTIN said DOA would be empowered to make that determination. She reiterated that the department was required, by statute, to dispose of equipment in the best interest of the state. REPRESENTATIVE EASTMAN posed a scenario in which multiple search and rescue groups were interested in the same item. He asked how that would be handled. MS. MARTIN shared her understanding that it would be resolved with a bidding procedure. CHAIR KREISS-TOMKINS expressed his interested in hearing a response from DOA; additionally, he inquired about the process by which property was currently disposed of. 4:04:39 PM MR. HARSHFIELD said currently, the state used www.govdeals.com to source out its auction items. He explained that the website had the capability to create multiple tiers of bidders, which included a public tier and a tier for state employees. He said if the bill were to pass, an additional tier would be created for search and rescue groups. CHAIR KREISS-TOMKINS sought to confirm that state employees had the right to first refusal and could effectively flag interest in an item, which in turn, would remove it from the public bidding process. MR. HARSHFIELD clarified that the item would be moved to the state employee tier, wherein the item could be pulled for state use only. CHAIR KREISS-TOMKINS asked how the right of first refusal functioned with the multi-tier system described by Mr. Harshfield. He considered a scenario in which a surplus DPS airplane was up for auction and asked whether any bid constituted the right of first refusal. MR. HARSHFIELD answered yes, the winning bidder on the tier would obtain the property. He explained that any item in the search and rescue tier would not be available to the public. CHAIR KREISS-TOMKINS sought to confirm that any single bid would effectively block an item from advancing to the public tier. MR. HARSHFIELD confirmed. 4:08:10 PM MS. MARTIN added that DOA had mentioned a "buy it now" price or a minimum bid for a scenario in which multiple search and rescue groups were not bidding on the same item. CHAIR KREISS-TOMKINS asked how a minimum bid or a "buy it now" price would work. MR. HARSHFIELD explained that DPS would set an estimate on the price of an item before it was sent to the surplus program. The surplus program would then list the item for search and rescue groups to purchase at that set price. 4:09:18 PM MR. HARSHFIELD, in response to a question from Representative Eastman, stated that set prices would be a rarity and something that would require further discussion. CHAIR KREISS-TOMKINS asked how common it was for a minimum bid to be exceeded in an auction scenario. MR. HARSHFIELD said most items with a set price sold well above the set price. He noted that typically, set prices were reserved for higher value items to accrue more money for the state. CHAIR KREISS-TOMKINS asked how much revenue DOA grossed in a fiscal year through the surplus property program. MR. HARSHFIELD said DOA grossed zero, as all the income from the program went straight to the general fund (GF). CHAIR KREISS-TOMKINS asked for the gross figure from sales. MR. HARSHFIELD answered slightly over $260,000 in 2021. He noted that the figure excluded vehicles and heavy equipment, which were sold through DOT&PF. CHAIR KREISS-TOMKINS asked Mr. Harshfiled to follow up with the total sales for vehicles and heavy equipment. 4:12:01 PM REPRESENTATIVE VANCE asked why the act was referred to as the Ellie Mae Act. SENATOR WILSON said he wanted to honor a service [indisc.] that passed away. 4:12:23 PM REPRESENTATIVE TARR asked whether in general, the surplus property program secured an appropriate price for the items' real value. MR. HARTFIELD estimated that most auction items brought in 5-15 percent of their original value. SENATOR WILSON pointed out that the items were originally purchased for state use. He said the intent was for the items to remain in state service for the remainder of their useful life. CHAIR KREISS-TOMKINS remarked, "How do you assess the potentially expanding the class of volunteers in communities who might benefit from state surplus equipment?" 4:16:38 PM SENATOR WILSON clarified that the equipment in question would go to organizations - not individuals. CHAIR KREISS-TOMKINS asked how the program would work for an informally organized group, such as [the search and rescue group] in Cake, Alaska, which lacked a tax status and bank account. MS. MARTIN said the groups must be organized to access the DOA portal. She believed that the term "organized" would best capture the search and rescue groups in Alaska without being overly prescriptive. CHAIR KREISS-TOMKINS announced that CSSB 95(STA) was held over.