SENATE BILL NO. 49 "An Act relating to missions and measures to be applied to certain expenditures by the executive branch of state government and the University of Alaska from the state operating budget for the fiscal year ending June 30, 1999; and providing for an effective date." Co-chair Torgerson called SB 49, sponsored by the Senate Finance Committee. Senator Parnell explained SB 49 for the committee. It is believed missions, measures and results should be clearly defined for each department in order to assure governmental results were to the satisfaction of the people. He briefly quoted from SB 76, which was passed by the Legislature and signed into law by the Governor last year. He then referred to a Texas budget, Department of Public Safety, 1995, using this as an example and explained how results were obtained. (This was done with the use of an overhead projector.) The next slide was from HB 325 the Department of Health and Social Services showing portions of missions and measures that were vetoed by the Governor last year in order to protect the constitutional mandates. The Governor felt the bill should not contain intent language. Now they must decide what kind of bill to pass and what it should contain. He suggested passage of a bill containing measures that included dollar amounts. These dollar amounts would reflect what had already been appropriated. SB 49 took all finance measures, which were negotiated last year, and then vetoed by the Governor, and put them into law this year for the 1999 budget. He hoped to continue this for 2000. Senator Parnell then briefly summed up SB 49. Senator P. Kelly asked if this was the sum total agreed upon last year? Why not put it into the statutes? Senator Parnell said it was the sum total from last year. He requested Teri Kramer from Legal Services come to the table. Teri Kramer, Legal Services, Legislative Affairs Agency was invited to join the committee. She said the missions and measures could be put into the bill. It would only be arduous to draft and there may be questions regarding existing statutes. Senator Adams asked what was the liability of putting something like this into a bill if it would not be correctly performed? He referred to section 2, page 2. And what happens if they do not come up to full expectations and there is a liability and challenge on each of these? He believed this bill violated the State Constitution and should perhaps have a judicial review. Article 2, section 13 set out the single substance requirement. Senator Adams felt it would not survive judicial scrutiny. Ms. Kramer said the single substance issue was certainly in issue. However, it only addresses a single year of appropriations. Courts have been generous in the past in considering this matter. She suggested it would perhaps be better to put it into several bills rather than lumped into one. Senator Parnell concurred that the Courts have been generous in the past. Missions and measures are an expression of legislative policy and therefore the State would be immune to liability. It is a legislative duty to set policy. Senator Leman agreed with Senator Adams regarding page 2. He felt that performance measures should only be what ought to be acquired. With reference to page 8, line 15, performance measures for permits.he asked what were the workable permits issued compared to the total permits issued. Will there be a total amount of workable permits and another total for unworkable permits? Senator Parnell responded. All missions and measures were established in the subcommittees and are in rough form. They were only a reflection of what was passed last year. Senator Leman asked what does "workable permit" mean. Senator Parnell said Ms. Kramer would have to respond. Senator Adams referred to missions and measures that we presently have and indicated that they were not accomplished as they should. He said, "Perhaps we should get away from the single substance issue." Ms. Kramer said she didn't feel there was any liability under single substance. She did not know what the Legislature intended if a department did not accomplish its measures. Senator Parnell responded that if an agency did not accomplish its measures then they would either do away with the program or cut it back, or the agency would convince the Legislature they needed more money to perform the specific duty. He said the bill was only an expression of policy and that the Legislature was immune to liability. Senator Adams asked about the public or constituency feeling that the missions and measures were not being fulfilled? The public would like to see an accomplishment. Senator Parnell agreed and said that the Legislature was acting as a representative of the people in holding the departments responsible. Senator P. Kelly reiterated the key to the missions and measures as discussed last year. The agencies did not have much objection, if any, to them. There were some technical problems and if departments and agencies could not agree then they were held over. There was going to be some failure, which would assist in getting a handle on what was expected of the agency. He felt this interaction was good. Senator Parnell said for years the executive branch had put performance measures into their detail books but had never been held accountable, nor did they really know what was in the detail books. In referring to the Executive Budget Act he said results could not be put into the budget itself. Senator Donley said measures should be put in the budget documents as in other states. "We are trying to get more efficiency in State government so people see the result of their money." By use of his veto power the Governor took out some good measures. Most of the departments had agreed to the measures he later vetoed. Jack Kreinheder, Senior Policy Analyst, Office of Management and Budget was invited to join the committee. He said they supported the bill in concept and appreciated the opportunity to work with the committee in the drafting of the bill. It would be preferable to have some clearer wording in the bill, however. In response to Senator Phillips, Mr. Kreinheder responded and used Y2K as an example. A mandatory statement by the Legislature regarding missions and measures could be a problem. Senator Parnell asked if the Administration had any other problems with any other section other than Y2K? Mr. Kreinheder said they had not done a comprehensive review. The Attorney General's office had done some. Y2K popped out because it was a "hot potato". Many of the other measures do not have a target, rather have a baseline. He is not aware of others that may raise pressing legal problems. This bill applies to current year but there were concerns to get it adopted quickly. The Administration was taking this seriously and departments were working on enhancing these measures. It would be preferable for the departments to work with the subcommittees to fine-tune the measures. Senator Parnell said he anticipated the subcommittees would do this but felt they needed the support of the bill. It would then be a potential vehicle for the year 2000. Mr. Kreinheder said they did not have any legal opinion regarding this bill. He spoke with Jim Baldwin along with a few others that had looked at the bill but he noted that no immunity for the State had been discussed. He said a reasonable level of compliance should be reached. Targets for litigation should be set if it were to be a compliance requirement. In response to Senator Parnell he said they felt the State could be held liable. Senator Donley suggested adding an amendment that would read: "The State could not be held liable for anything contained herein." Senator Phillips said he thought the State was looking for perfection. Therefore a standard of excellence should be set up and measured against. Perfection is not going to happen. Department of Law was going to have to work with the Legislature and this bill was a good start. People want to know if they are getting their money's worth. Senator Kelly said he knew there was going to be a problem with Y2K. He asked if they were compliant? Senator Parnell said Y2K was under mission critical. Co- chair Torgerson concurred. Senator Parnell further explained that one hundred percent of mission critical was covered by disaster recovery program. He also advised the committee that there were a host of other Y2K problems. Senator P. Kelly reiterated his concern for the Y2K issue. There will still be problems because everything cannot be anticipated. Co-chair Torgerson felt that the Office of Management and Budget was trying to delay the bill. They want to have words in there that have no accountability. Mr. Kreinheder said it was not their intent to hold the bill up. He was also not going to argue on the one hundred percent compliance for the Y2K problem. The Department of Law can address the other questions raised. Some redrafting would make it clear that the bill was an expression of policy by the Legislature. Senator Adams did not feel that the Office of Management and Budget was trying to hold up the bill, rather they were only suggesting rewording. Senator Parnell referred to Amendment #1. Accountability, he said, rests back here. He then requested the bill be held over until Thursday. He will work with Legislative Legal, Senator Donley and the Administration on more specific language. Perhaps that would help solve the saber rattling. Senator Adams voiced concern on the single substance issue. He wanted a memorandum on that. Senator Parnell agreed to seek to clarify the single substance issue. Suzanne Tryck, WWAMI Coordinator joined the committee by teleconference from Anchorage. She said she had no comments to make regarding the bill but would be happy to answer any questions. Co-chair Torgerson SET ASIDE SB 49 until Thursday. He then called SB 3.