COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 312(FIN) am(brf sup maj fld)(efd fld) "An Act making and amending appropriations for the operating and loan program expenses of state government, for certain programs, and to capitalize funds." COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 313(FIN) am "An Act making appropriations for the operating and capital expenses of the state's integrated comprehensive mental health program; and providing for an effective date." At the previous hearing, the Committee considered amendments to these bills. This meeting is a continuation. DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT EED #1: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 8, line 13 Delete: Pupil 39,775,100 37,775,000 Transportation Insert: Pupil 44,855,000 44,855,000 Transportation Page 2, line 9 through 31, line 23 Insert: Notwithstanding the amounts otherwise set out in this section, each appropriation made on page 2, line 9, through page 23, line 22, of this section and page 25, line 15, through page 31, line 23, of this section is reduced by an amount equal to one percent of the general funds allocated for personal services and for travel under each of those appropriations. "General funds" includes funds described as general fund, general fund program receipts, general fund match, and general fund mental health. Provides for 100% reimbursement of approved projected transportation costs for both district-operated and contracted bus routes. Senator Donley moved for adoption and explained that this amendment would fully fund pupil transportation expenses. He pointed out that a one-percent, across the board reduction to personnel and travel budgets for all state agencies, with the exception of the Department of Public Safety, would fund this item. Co-Chair Parnell objected to the amendment. Co-Chair Torgerson restated his intent to deal with pupil transportation with separate legislation, SB 290, that was pending in the Committee. He stated that this bill should be before the Senate at same time as the FY 01 Operating Budget. Senator Green commented that the aforementioned bill would need a lot of review before she could support it. She clarified that she did support some type of action, but wanted to be sure it was the most appropriate approach. A roll call was taken on the motion to adopt the amendment. IN FAVOR: Senator Donley and Senator Adams OPPOSED: Senator Wilken, Senator P. Kelly, Senator Green, Senator Leman, Co-Chair Torgerson and Co-Chair Parnell ABSENT: Senator Phillips The motion FAILED (2-6-1) The amendment FAILED to be adopted. AT EASE 10:00 AM / 10:01 AM EED #2: This amendment adds $1 million Temporary Assistance for Needy Families (TANF) funds for the Early Development Budget Request Unit (BRU), Headstart component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams spoke to an amendment to the amendment that reappropriates $1 million TANF funds to the Public Assistance Administration BRU, Child Care Benefits component, and appropriates $1 million Interagency Receipts (I/A) to the Early Development BRU, Headstart component. He extolled the benefits of the Headstart program, saying that this $1 million appropriation would secure $4 million in federal funding, which would allow 200 additional children to participate in the program. Senator Adams offered a motion to amend the amendment. There was no objection and the amendment was AMENDED. Senator Wilken expressed that Headstart and childcare were important issues to the State Of Alaska and to the Committee. He hoped that the Committee would recognize that Headstart was already funded with almost $28 million and had sufficient funding. He felt that the requested increase should go to those programs that directly affect as many children in the state as possible. The budget, proposed in the committee substitute, accomplished this, he stated and he therefore recommended it not be changed. Senator Leman calculated that the $5 million total funding increase worked out to a cost of $25,000 for each additional student admitted to the program. He wondered if that figure was an error, as it seemed high to him. Senator Adams stated that Senator Leman' calculations were correct and offered a representative from the Department of Education and Early Development to give details. KAREN REHFELD, Director, Education Support Services, Department of Education and Early Development, explained the matching requirements to receive the federal funds. She was uncertain if this amendment would guarantee receipt of the entire $4 million federal funds. Senator Leman asked the cost for each student. Ms. Rehfeld did not have exact figures but noted that currently Headstart serves 3,400 students statewide. She stated that the costs probably vary by location. Senator Wilken cited the Alaska Headstart Program statistics. In 1999, he read, there were 3,351 children served at a total cost of approximately $29 million. He divided these numbers to reach a cost of $8,500 per participant. Senator Adams asked if the current Headstart program served only 23 percent of the eligible families in the state. Ms. Rehfeld affirmed this was correct. A roll call was taken on the motion. IN FAVOR: Senator Adams OPPOSED: Senator P. Kelly, Senator Green, Senator Phillips, Senator Donley, Senator Leman, Senator Wilken, Co-Chair Torgerson and Co-Chair Parnell. The motion FAILED (1-8) The amendment FAILED to be adopted. EED #3: This amendment inserts $1,800,000 TANF funds for the Early Development BRU, Child Care Assistance and Licensing component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams commented that although the subcommittee was limited in how much could be allocated to this component, the existing budget only funds the existing caseload and the anticipated care for those families coming off of public assistance. He stressed that the program has a waiting list of 1,200 children that would rise to 2,200 under the peak job market. He spoke of the families excluded from this program because they do not receive public assistance. He recounted testimony given by a single mother, who had a job offer, but was unable to accept it because of the need for childcare assistance. He expressed that the system is "backwards" and that anyone wishing to continue work should receive help with daycare expenses without first entering the welfare system. Senator Wilken moved to amend the amendment to add a total of $1,821,700 to the Child Care Assistance and Licensing component as detailed in EED #3B that reads as follows. Appropriation General Other Allocation Items Funds Funds HB 312 Page 8, line 26 Delete: Child Care 65,920,300 8,396,600 57,523,700 Assistance & Licensing Insert: Child Care 66,386,300 8,862,600 57,523,700 Assistance & Licensing Page 8, line 28 Delete: Child Care 29,148,600 Assistance & Licensing Insert: Child Care 29,614,600 Assistance & Licensing General Funds saved from a fund source change in State Health Services is appropriated for Child Care Assistance and Licensing operations. Add new bill sections to read: Sec.__. The unexpended and unobligated balance on June 30, 2000, of the appropriation made by sec. 43, ch. 84, SLA 1999, page 23, line 21 (Out-of-State Contracts), not to exceed $355,700 is appropriated to the Department of Education and Early Development for operation of the childcare assistance and licensing for the fiscal year ending June 30, 2001. Sec.__. The unexpended and unobligated balance of general funds of the appropriation made in sec. 77 (b), ch2, FSSLA 1999 is reappropriated to the Department of Education and Early Development, child care assistance and licensing for the fiscal year ending June 30, 2001. Add immediate effective dates for new sections. Appropriation General Other Allocation Items Funds Funds HB 313 Page 4, line 32 Delete: State Health 4,637,700 4,419,700 220,000 Services Insert: State Health 4,637,700 3,953,700 686,000 Services Page 5, line 4 Delete: Healthy 566,000 Families Insert: Healthy 566,000 Families GF/MH funds in the Healthy Families component are replaced with I/A Receipts from the federal TANF block grant. Senator Adams perceived a technical problem with the unexpended and unobligated balance portion of this amendment to the amendment and asked that the department address this. He applauded the intent and stated that he wanted this to "work". Senator Wilken reviewed the impact to the income qualified childcare subsidy if this amendment to the amendment passed. He noted that this adds $4.178 million to the subsidy, which will maintain status quo and fund the anticipated increases in the FY 01 budget. He continued pointing out that the $22 grants to licensed daycare centers is raised to $33 per student at a cost of approximately $917,000. He emphasized that to qualify for the grant, a daycare center must be licensed by the department and that this amendment appropriates $700,000 to enable the department to license these centers. He opined that this "drives quality." He summarized that this adds $5,795,000 to the daycare effort and recognizes this legislature's understanding of daycare and how it fits into the welfare system and society as a whole. He encouraged support of the amendment to the amendment. Senator Green asked for information on how many additional clients would be served with this increase. Senator Wilken clarified that this amendment funds 80 percent of the waitlist in addition to existing clients and anticipated increases from those leaving public assistance. He noted that the woman, whose testimony Senator Adams referred to, would be served and thus able to accept the job offer. Senator Adams stressed that all Committee members wanted this program to work and requested that the department address difficulties with the funding source methodology. Ms. Rehfeld explained how the legislature, in the previous year, had included this reappropriation of approximately $1 million of general funds with funding for the Balloon Project within the Department of Health and Social Services. Senator Adams asked if the Department of Health and Social Services had begun to expend this money. Co-Chair Parnell Senator Phillips asked why the $1 million was not spent on the Balloon Project the previous year when it was appropriated. JANET CLARKE, Director, Division of Administrative Services, Department of Health and Social Services responded that in the previous year, the department transferred TANF funds into the FY 99 budget, which freed up over $2 million general funds. This excess money, she continued was reappropriated to the Balloon Project for a two-year, one-time project. The purpose she said was that rather than adding permanent workers, 14 social workers would be employed in the first year, seven in the second year, and in the third year attorney positions would be funded to place children out of foster care. She stated that this was done at the request of the Department of Health and Social Services. She reminded the Committee that although the legislature approved of this plan, it required the department to prove the success of the program before approving funding for the second year. Therefore, she explained the funds were not spent because the legislature directed the department to not spend it until receiving approval. She reported that the agency was able to double the number of adoptions and also found that many children were able to return to their homes. As a result, she expressed that the entire amount of funding for the Balloon Project was no longer needed. Co-Chair Parnell surmised that the amendment and the amendment to it needed adjustments. Senator Wilken moved to remove his motion to amend the amendment. There was no objection and the motion was WITHDRAWN. Without objection, Senator Adams WITHDREW his motion to adopt the amendment and the amendment was HELD. EED #4: This amendment inserts $3,609,400 general funds to the Pupil Transportation BRU, Pupil Transportation component. Language accompanying the amendment states, "This proposal equates to FY 00 funding plus half of the FY 01 requested increase." This amendment was NOT OFFERED due to the statement made by Co-Chair Torgerson with regard to SB 290 that would fund this item. AT EASE 10:20 AM / 10:23 AM EED #5: This amendment inserts a new bill section on page 43, following line 3 of the committee substitute as follows. Sec. 13. Learning Opportunity Grants. The unexpended and unobligated balance on June 30, 2000, of the appropriation made by sec. 43, ch. 84, SLA 1999, page 23, line 30 (K-12 Support - $762,280,800), is appropriated to the Department of Education and Early Development for the fiscal year ending June 30, 2001, for Learning Opportunity Grants as a component of public school funding. A district is eligible to receive a Learning Opportunity Grant not to exceed the district's ADM multiplied by $43.75. Learning Opportunity Funding Grants must by used for supplemental student instructional programs intended to improve student performance on the high school graduation examination or benchmark examinations. The department shall by regulation establish a grant process to implement this section. [T]he fiscal year ending June 30, 2001. Co-Chair Torgerson moved for adoption. Senator Green objected. Co-Chair Torgerson moved to make a technical correction to remove the final sentence of the amendment saying it was duplication of language contained earlier in the section. Co-Chair Parnell reminded that the Division of Legislative Finance and the Division of Legal and Research Services had blanket authority to make conforming changes where necessary. Co-Chair Torgerson explained that this amendment gives authorization for the expenditure of $5,787,100 by the department for learning opportunity grants. He noted that the funds were lapsed from the previous fiscal year and were not needed to fund K-12 education as originally appropriated. He referenced an attachment to the amendment that explained the learning opportunity grants. [Copy on file.] He added that the amendment gives the department authority to establish regulations to implement the legislature's intent. Senator Wilken explained the learning opportunity grants and the legislature's attempt to ensure that K-12 teaching professional are focused on HB 146, passed into law three years prior. This legislation requires high school students, beginning in 2002, to pass an exit exam before receiving a diploma. He stressed that the students need to be ready for that test and that this money should go directly to the classrooms in recognition of the importance of the exams. He emphasized how the funds are targeted to ensuring the readiness of K-12 students and that this amendment requires evaluations of the progress toward this goal. He stated that he supported the amendment. Senator Phillips wanted to know the balance of the lapsed K-12 education appropriation if this amendment were approved. Co-Chair Parnell responded this would fully expend the funds. Senator Green endorsed the concept of directing money to the classroom but was not in favor of establishing a grant method. She wanted to avoid a "paper mill" requirement of school districts to qualify for these funds. She suggested appropriating the funds to schools along with instructions on how they should be spent. Senator Leman stated he would also oppose the amendment saying the foundation formula program should instead be operated to cover these needs. He surmised that this amendment rewards those districts that do a poor job. AT EASE 10:28 AM / 10:37 AM Senator Green offered a conceptual amendment to the amendment to replace "grant" with "bonus" in the five places it appears in the amendment. [This language is titled EED #5A and is contained in the bill file.] Co-Chair Torgerson objected saying it [Tape malfunction - poor quality recording] A roll call was taken on the motion. IN FAVOR: Senator Wilken, Senator P. Kelly, Senator Green, Co-Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Phillips, Senator Donley, Senator Leman, and Senator Adams The motion FAILED (4-5) The amendment FAILED to be amended to reflect the language in EED #5A. Co-Chair Torgerson asked Ms. Rehfeld to explain what the administrative costs would be in implementing these grants. Ms. Rehfeld responded that the intention of this proposed one-time program would not change the established public school funding program. She continued that the department would be able to administer this grant program similar to the Quality Schools Grant application process that districts already prepare annually. She predicted that the learning opportunity grants could be incorporated into the existing process without additional administrative costs. Her only concern was the potential cost of developing new regulations, but thought that because this was a one-time program, extensive changes might not be necessary. Senator Phillips asked the current percent of funds spent on administration. Ms. Rehfeld replied that currently no administrative overhead costs are charged to the foundation formula for administrating the Quality Schools Grant program. Senator Phillips then wanted to know if there would be any administration costs at the school district level. Ms. Rehfeld anticipated that if the two grants were operated together, there would be no additional administrative costs. Senator Wilken suggested removing the last sentence of the amendment to the amendment that states, "The department shall by regulation establish a grant process to implement this section." Co-Chair Torgerson understood that regulations must be in place before any new program could be implemented. He recommended the department amend the regulations governing the Quality Schools Grant program to include the Learning Opportunity Grants program. He did not intend to require the department to undergo the lengthy process of adopting an entirely new set of regulations for this one-time disbursal. AT EASE 10:44 AM / 10:44 AM Senator Wilken clarified information contained in the attachment to the amendment. He noted that the total amount of the grant would be $43.75 per the district's Average Daily Membership. A roll call was taken on the motion to adopt the amendment. IN FAVOR: Senator Phillips, Senator Donley, Senator Adams, Senator Wilken, Senator P. Kelly, Co-Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Green and Senator Leman The motion PASSED (7-2) The amendment as technically amended was ADOPTED. AT EASE 10:47 AM DEPARTMENT OF PUBLIC SAFETY DPS #2A: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 23, lines 26 and 27 Delete: Fish & Wildlife 16,124,000 14,771,800 1,352,200 Protection Enforcement 11,140,500 & Investigative Services Office Insert: Fish & Wildlife 16,124,500 14,843,300 1,422,200 Protection Enforcement 11,282,000 & Investigative Services Office Page 24, lines 31 and 32 Delete: Council on Domestic 8,957,800 2,819,100 6,138,700 Violence & Sexual Assault Insert: Council on Domestic 9,287,800 1,869,800 7,418,000 Violence & Sexual Assault Page 25, line 14 Delete: Victims for 200,000 200,000 Justice Insert: Victims for 246,000 246,000 Justice The net effect is to provide additional funds to the Council on Domestic Violence and Sexual Assault ($300.0 PFD felons funds), and Victims for Justice ($46.0 GF). Additionally, the increment will fund a Fish and Wildlife protection officer for the Division of Fish and Wildlife Protection ($71.5 GF and $70.0 Fish and Game Fund). The amendment replaces general funds with PFD felons funds ($949.3). Senator Donley moved for adoption and pointed out that the funds allocated to the Council and the Victim's for Justice organization would allow additional outreach in rural areas with the state as well as working to prevent murders during robberies. Senator Adams supported the amendment. However, he noted an error was made the previous year in the budget and asked it this amendment corrects that. Co-Chair Parnell answered that it does. Senator Phillips wanted to know if this goes to Victims for Justice or just new state positions. Co-Chair Parnell replied that these funds go directly to the programs and would not be used for any new state positions. Senator Phillips asked if there was a need for both the Council and the Victim's for Justice organization, wanting to know if they could be combined into one organization. Senator Donley explained that the Council satisfies a federal mandate of providing a council forum to address issues specific to domestic violence and sexual assault. He continued that Victim's for Justice, on the other hand, satisfies a different mandate to serve all victims of crime. Co-Chair Parnell clarified that the Division of Fish and Wildlife Protection is able to take advantage of general funs that are freed up from using PFD felon funds for the Council. Senator Green affirmed. Co-Chair Parnell pointed out that this amendment results in a reduction of general funds. A roll call was taken on the motion. IN FAVOR: Senator Green, Senator Donley, Senator Adams, Senator Wilken, Co-Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Phillips, Senator Leman and Senator P. Kelly The motion PASSED (6-3) The amendment as technically amended was ADOPTED. DPS #6: This amendment inserts $100,000,000 Permanent Fund Dividend Funds (PFDF) for the Council on Domestic Violence and Sexual Assault BRU. This amendment was NOT OFFERED. DPS #2: It was clarified that this amendment utilizes fish and game duplicated funds, rather than fish and game funds. There was no objection to this clarification. Senator Adams and Co-Chair Parnell established that this amendment accomplishes the goal of the proposed amendment to DPS #7. [End tape malfunction.] Tape: SFC - 00 #70, Side B 11:01 AM AT EASE 11:01 AM / 3:36 PM DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES DOT #6: This amendment was considered in the previous hearing, but failed to be adopted. Senator Wilken moved to rescind the Committee's action failing to adopt the amendment. There was no objection and the action was RESCINDED. The amendment was back before the Committee. Senator Wilken move to amend the amendment replacing the language with the language contained in DOT #6A. This language reads as follows. The unexpended and unobligated balance of June 30, 2000, of the appropriation made by sec. 43, ch. 84, SLA 1999, page 23, line 21 (Out-of-State Contracts), not to exceed $31,300 is appropriated to the Department of Transportation and Public Facilities, Northern Region Highways and Aviation for operations for the fiscal year ending June 30, 2001. Explanation This is an increase of $31,300. The increased appropriation is for plowing open the following roads during the spring of 2001: $10,500 Boundary Spur 5,800 Fairbanks area roads: US Creek, Fairbanks Creek, Tofty, Eureka 15,000 Copper River Road. Senator Wilken explained the funding was originally appropriated to the Department of Corrections to fund contracts with facilities outside of the state to house inmates. He stated that all of the funds were not needed and the remaining amount was available for the snow removal operations. Senator Phillips objected. There was no debate. A roll call was taken on the motion to amend the amendment. IN FAVOR: Senator Adams, Senator Wilken, Senator Green, Senator Leman, Co-Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Phillips ABSENT: Senator P. Kelly and Senator Donley The motion PASSED (6-1-2) The amendment was AMENDED. A roll call was taken on the motion to adopt the amendment as amended. IN FAVOR: Senator Leman, Senator Adams, Senator Wilken, Senator Green, Co-Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Phillips ABSENT: Senator Donley and Senator P. Kelly The motion PASSED (6-1-2) The amended amendment was ADOPTED. DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT EED #3: This amendment inserts $1,800,000 TANF to the Early Development BRU, Component Care Assistance and Licensing component. A motion to adopt this amendment was offered and withdrawn earlier in the meeting. Senator Adams moved for adoption. Co-Chair Parnell objected. Co-Chair Parnell spoke to a proposed amendment to the amendment. At ease 3:40 PM / 3:48 PM Co-Chair Parnell noted an error in the proposed amendment to the amendment. [A copy of this amendment to the amendment is on file and titled EED #3A. It is identical to EED #3B except that the amount allocated to Child Care Assistance and Licensing is $29,641,600.] Without objection, Senator Adams WITHDREW his motion to adopt the amendment. LANGUAGE SECTION LANG #1: This amendment inserts new language on page 2, line 9, through page 31, line 23 of the committee substitute as follows. Notwithstanding the amounts otherwise set out in this section, each appropriation made on page 2, line 9, through page 23, line 22, of this section and page 25, line 15, through page 31, line 23, of this section is reduced by an amount equal to one percent of the general funds allocated for personal services and for travel under each of those appropriations. "General funds" includes funds described as general fund, general fund program receipts, general fund match, and general fund mental health. This amendment was NOT OFFERED. LANG #2: This amendment inserts new language on page 2, line 9, through page 31, line 23 of the committee substitute as follows. Notwithstanding the amounts otherwise set out in this section, each appropriation made on page 2, line 9, through page 23, line 22, of this section and page 25, line 15, through page 31, line 23, of this section is reduced by an amount equal to three percent of the general funds allocated for personal services and for travel under each of those appropriations. "General funds" includes funds described as general fund, general fund program receipts, general fund match, and general fund mental health. This amendment was NOT OFFERED. LANG #3: This amendment inserts new language on page 2, line 9, through page 31, line 23 of the committee substitute as follows. Notwithstanding the amounts otherwise set out in this section, each appropriation made on page 2, line 9, through page 23, line 22, of this section and page 25, line 15, through page 31, line 23, of this section is reduced by an amount equal to two percent of the general funds allocated for personal services and for travel under each of those appropriations. "General funds" includes funds described as general fund, general fund program receipts, general fund match, and general fund mental health. This amendment was NOT OFFERED. LANG #4: This amendment inserts new language on page 2, line 9, through page 31, line 23 of the committee substitute as follows. Notwithstanding the amounts otherwise set out in this section, each appropriation made on page 2, line 9, through page 23, line 22, of this section and page 25, line 15, through page 31, line 23, of this section is reduced by an amount equal to four percent of the general funds allocated for personal services and for travel under each of those appropriations. "General funds" includes funds described as general fund, general fund program receipts, general fund match, and general fund mental health. This amendment was NOT OFFERED. LANG #5: This amendment inserts new language on page 2, line 9, through page 31, line 23 of the committee substitute as follows. Notwithstanding the amounts otherwise set out in this section, each appropriation made on page 2, line 9, through page 23, line 22, of this section and page 25, line 15, through page 31, line 23, of this section is reduced by an amount equal to five percent of the general funds allocated for personal services and for travel under each of those appropriations. "General funds" includes funds described as general fund, general fund program receipts, general fund match, and general fund mental health. This amendment was NOT OFFERED. LANG #8: This amendment pertains to the Department of Community and Economic Development, Insurance Operations BRU. New language is inserted on page 5, following line 31 of the committee substitute as follows. The amount appropriated by this appropriation includes the unexpended and unobligated balance on June 30, 2000, of the Department of Community and Economic Development, division of insurance, general fund program receipts from insurance fees under AS 21.06.250, and general fund program receipts from insurance fees under AS 21.06.250 received during the fiscal year ending June 30, 2001, and other program receipts received by the division during the fiscal year ending June 30, 2001. (Several subcommittees took no formal action on language adopted by the House. Per a survey of subcommittee Chairs, subcommittees intended the language in this amendment to be included in the committee substitute bill.) Co-Chair Torgerson moved for adoption. Senator Adams objected for an explanation. Co-Chair Parnell relayed that this language was inadvertently omitted from the committee substitute although it is standard to most operating budget bills according to the subcommittee and the administration's understanding. Senator Adams removed his objection. There was no objection and the amendment was ADOPTED. LANG #9: This amendment pertains to the commissioner's office of all departments and eliminates 403.5 positions located in Anchorage. With an average salary plus benefits of $48,793 for each position, the amendment estimates a general fund reduction of $19,687,975,500. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams stressed that he is not opposed to Anchorage and that he probably pays as much property tax as any other person living in Anchorage, as his second home is located there. However, he stated that the location of several state positions has shifted to Anchorage, although these positions have been essential to Rural Alaska and to Juneau. He expressed that the savings from this amendment would fund the costs of the other amendments he has submitted to the FY 01 operating budget to fund important state services and programs. Senator Adams surmised that the large budget cuts claimed by the House of Representatives are actually just shifted funds. Senator Adams reiterated that this amendment was not intended as an action against Anchorage but to provide an opportunity to meet the self-interest groups and some of the constituent's request to cut the state government's budget. He stated that if any member wished to offer position reductions from his or her district, he would be willing to consider those reductions as well. Senator Phillips asked what were the employment figures for Juneau. Senator Adams replied that in 1985, Juneau had 4,437 state employees and in 1999, the number had dropped to 4,207. Senator Phillips asked how many in state employees were in Anchorage during those two sample years. Senator Adams listed 6,890 employees in 1985 and 8,504 state employees at present. He said he utilized these figures to compile the number of positions to be eliminated, which equaled a 25 percent decrease in Anchorage. Senator Leman said he might be inclined to support this amendment if he could be assured that the positions would not show up elsewhere in the state. He asked if the specific positions were identified. Senator Adams responded that his intent is to direct the Office of Management and Budget to choose the positions and to also ensure that they are not recreated in other communities. Co-Chair Parnell reminded of his argument made the previous day against Senator Donley's amendment for an unallocated budget reduction that failed to recognize the importance of 24-hour facilities. He gave Pioneer's Homes and correctional facilities as an example. A roll call was taken on the motion. IN FAVOR: Senator Phillips and Senator Adams OPPOSED: Senator Green, Senator Leman, Senator Wilken, Senator P. Kelly, Co-Chair Torgerson and Co-Chair Parnell ABSENT: Senator Donley The motion FAILED (2-6-1) The amendment FAILED to be adopted. Senator Leman had originally cast a Yea vote, but changed to Nay before the final tally. LANG #10: This amendment amends Section 4 as follows. Sec 4. ALASKA OIL AND GAS CONSERVATION COMMISSION. The unexpended and unobligated balance on June 30, 2002, of the Alaska Oil and Gas Conservation Commission receipts account for regulatory cost charges under AS 31.05.093 and permit fees under AS 31.05.090 for the fiscal year 2000 is [APPROPRIATED] included in the appropriation to the Alaska Oil and Gas Conservation Commission [FOR FISCAL YEAR 2001 OPERATIONS] in Section 1 of this Act. New text underlined [DELETED TEXT BRACKETED] Discussion: This is a technical change to make clear that although unspent fees collected by AOGCC are to be used in the following year to reduce charges to industry, this section does not increase the appropriation to AOGCC. Co-Chair Torgerson moved for adoption. Co-Chair Parnell explained the technical change as suggested by the Administration. Without objection or debate, the amendment was ADOPTED. AT EASE 4:02 PM / 4:08 PM DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT CED #2: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 5, line 32 Delete: Occupational 5,519,300 5,052,900 466,400 Licensing Insert: Occupational 4,519,300 4,052,900 466,400 Licensing This amendment reduces the amount from general fund program receipts by $1,000,000. Page 45, following line 10 Insert a new bill section to read: Sec. 23. Section 18, ch. 84, SLA 1999, is amended to read: Sec. 18. OCCUPATIONAL LICENSING. The unexpended and unobligated balance on June 30, 1999, of the Department of Community [COMMERCE] and Economic Development, division of occupational licensing, general fund program receipts, general fund program receipts from occupational licensing fees under AS 08.01.065, general fund program receipts received from occupational licensing fees under AS 08.01.065 during the fiscal year ending June 30, 2000, and other program receipts received by the division during the fiscal year ending June 30, 2000, not to exceed a total appropriation of $6,053,200 [$5,053,200], are appropriated to the Department of Community [COMMERCE] and Economic Development, division of occupational licensing, for operating costs for the fiscal year ending June 30, 2000, and the fiscal year ending June 30, 2001. Page 48. Following line 25 Insert new bill sections to read: Sec. 38. Section 23 of this Act is retroactive to July 1, 1999. Sec. 39. Section 23 of this Act takes effect immediately under AS 01.10.070(c) Renumber bill sections and make conforming changes accordingly. New Text Underlined [DELETED TEXT BRACKETED] Co-Chair Torgerson moved for adoption. Co-Chair Torgerson moved to amend the amendment to change the amount of the reduction from $1,000,000 to $550,000. The amended amendment reads as follows. Appropriation General Other Allocation Items Funds Funds Page 5, line 32 Delete: Occupational 5,519,300 5,052,900 466,400 Licensing Insert: Occupational 4,969,300 4,502,900 466,400 Licensing This amendment reduces the amount from general fund program receipts by $1,000,000. Page 45, following line 10 Insert a new bill section to read: Sec. 23. Section 18, ch. 84, SLA 1999, is amended to read: Sec. 18. OCCUPATIONAL LICENSING. The unexpended and unobligated balance on June 30, 1999, of the Department of Community [COMMERCE] and Economic Development, division of occupational licensing, general fund program receipts, general fund program receipts from occupational licensing fees under AS 08.01.065, general fund program receipts received from occupational licensing fees under AS 08.01.065 during the fiscal year ending June 30, 2000, and other program receipts received by the division during the fiscal year ending June 30, 2000, not to exceed a total appropriation of $6,053,200 [$5,053,200], are appropriated to the Department of Community [COMMERCE] and Economic Development, division of occupational licensing, for operating costs for the fiscal year ending June 30, 2000, and the fiscal year ending June 30, 2001. Page 48. Following line 25 Insert new bill sections to read: Sec. 38. Section 23 of this Act is retroactive to July 1, 1999. Sec. 39. Section 23 of this Act takes effect immediately under AS 01.10.070(c) Renumber bill sections and make conforming changes accordingly. New Text Underlined [DELETED TEXT BRACKETED] Co-Chair Parnell stated this is a technical change and that the Administration understands the intent. Senator Leman did not understand how this change was only technical if the reduction amount was changed. Co-Chair Parnell explained that the FY 00 budget established a limit on the level of spending on licensing expenses. He then referred to testimony given to the Committee that stated the division "essentially gambles" on a supplemental budget supplying adequate operating funds. Co-Chair Parnell expressed that he did not want agencies taking this approach. He continued that the intent of the amendment is to assure the division that it would receive $450,000 in the FY 01 budget, but would under no circumstances receive that amount the subsequent year. Senator Phillips asked if the revenues generated from the fees charged to issue these licenses is used to fund the licensing costs or for other purposes. Co-Chair Parnell thought this governmental function has higher returns than operating expenses. DAVE BLAISDELL, Staff to Co-Chair Parnell, stated that although the division generates revenue, legislative appropriations must be made before any funds can be expended. [This witness spoke out of range of the audio recording system.] Senator Adams requested the administration speak to this amendment. He wanted to know if the department supported the amendment to the amendment. JEFF BUSH, Deputy Commissioner, Department of Community and Economic Development testified that this change would solve the division's fiscal problems for the current fiscal year. Without objection, the amendment was AMENDED. There was no objection and the amended amendment was ADOPTED. CED #10: This amendment inserts $1,534,000 general funds to the Municipal Revenue Sharing BRU, State Revenue Sharing component, and $1,866,000 general funds to the Municipal Revenue Sharing BRU, Municipal Assistance component. Accompanying language states, "Restores FY 00 level of funding for both Revenue Sharing and Municipal Assistance." This amendment was NOT OFFERED. Senator Adams stated that he had prepared another amendment that he would offer if the matter of Municipal Assistance and Revenue Sharing were not otherwise addressed. DEPARTMENT OF LAW LAW #1: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 21, lines 4-7 Delete: Oil & Gas Litigation 5,080,500 3,603,500 1,477,000 & Legal Services Oil & Gas 4,784,800 Litigation Oil & Gas 295,700 Legal Services Insert Oil & Gas Litigation 4,830,500 3,353,500 1,477,000 & Legal Services Oil & Gas 4,534,800 Litigation Oil & Gas 295,700 Legal Services Page 20, line 8 Delete: Criminal Division 14,124,800 12,562,800 1,562,000 Insert: Criminal Division 14,374,800 12,812,800 1,562,000 Adds $250,000 for Criminal Division BRU from Oil and Gas Litigation. Net zero increase. [This amendment was adopted in the previous hearing.] Co-Chair Parnell noted a technical correction for the Division of Legislative Finance to give authorization to the Department of Law to move funds from the Oil and Gas Litigation BRU to any component related to prosecution services within the Criminal Division BRU. Senator Adams asked if the department had a suggestion as to which component the funds should be assigned. KATHRYN DAUGHTEE, Director, Division of Administrative Services, Department of Law said the intended reallocation was unclear, which was why clarification was requested. She suggested the Criminal Justice Litigation component as one option. Senator Adams offered a motion to give direction to the Department of Law to expend the funds in the Criminal Justice Litigation component. He noted that if Senator Donley wished to change this allocation, he could offer an amendment before the full Senate. There was no objection to Senator Adams' motion and it was ADOPTED. DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES Co-Chair Parnell relayed instructions to the Division of Legislative Finance to make technical adjustments to restore the new accounting code in Section 2 of the committee substitute, relating to Marine Highway Duplicated Expenditures to conform with the House of Representatives' version of the FY 01 operating budget. DEPARTMENT OF CORRECTIONS COR #8: This amendment replaces general funds with SDPR for the following components of the Administration and Operations BRU and the Community Corrections BRU, in the following amounts. Administration and Operations Institution Director's Office $225,000 Combined Hiland MT Correctional Center 290,200 Cook Inlet Correctional Center 249,100 Fairbanks Correctional Center 21,000 Ketchikan Correctional Center 20,500 Lemon Creek Correctional Center 101,900 Mat-Su Correctional Center 59,100 Palmer Correctional Center 156,100 Sixth Avenue Correctional Center 883,900 Wildwood Correctional Center 15,600 Electronic Monitoring 645,600 Subtotal 2,668,000 Community Corrections Community Residential Centers 811,000 Total $3,479,000 This amendment was NOT OFFERED to defer to COR #8A. COR #8A: This amendment replaces general funds with SDPR for the following components of the Administration and Operations BRU and the Community Corrections BRU, in the following amounts. Administration and Operations Institution Director's Office $195,600 Combined Hiland MT Correctional Center 290,200 Cook Inlet Correctional Center 249,100 Fairbanks Correctional Center 21,000 Ketchikan Correctional Center 20,500 Lemon Creek Correctional Center 101,900 Mat-Su Correctional Center 59,100 Palmer Correctional Center 156,100 Sixth Avenue Correctional Center 883,900 Wildwood Correctional Center  15,600 Subtotal 1,993,000 Community Corrections Community Residential Centers 811,000 Total $2,804,000 Co-Chair Torgerson moved for adoption. Co-Chair Parnell explained the reason for this funding change it because AS 37.05.146 dictates that SDPR means "money received by the state, restrictive to specific use by the terms of a contract." He noted that local governments have contracts with the aforementioned correctional centers to house inmates serving sentences for convictions of local infractions and this is the source of the SDPR funds. There was no objection and the amendment was ADOPTED. COR #9: This amendment replaces general funds with SDPR for the following components of the Administration and Operations BRU and the Community Corrections BRU, in the following amounts. BRU: Administration and Operations Component: Institution Director's Office $225,000 Combined Hiland MT Correctional Center 290,200 Cook Inlet Correctional Center 249,100 Fairbanks Correctional Center 21,000 Ketchikan Correctional Center 20,500 Lemon Creek Correctional Center 101,900 Mat-Su Correctional Center 59,100 Palmer Correctional Center 156,100 Sixth Avenue Correctional Center 883,900 Wildwood Correctional Center 15,600 Electronic Monitoring 645,600 Community Jails Restore: 80,700GF Electronic Monitoring 645,600 Subtotal 2,668,000 BRU: Community Corrections Component: Community Residential Centers 811,000 Total 3,479,000 This amendment also inserts general funds to the Department of Community and Economic Development, Municipal Revenue Sharing BRU as follows. State Revenue Sharing $1,534,000 Municipal Assistance  1,866,000 Total 3,400,000 Language accompanying the amendment reads as follows. Switch funding for existing correctional programs from G.F. to Statutory Designated Program Receipts as requested in the Governor's FY 2001 Budget Request and Fund Municipal Assistance and Revenue Sharing at Fiscal Year 00 Level. Restore $80.7 G.F. cut to Community Jails This amendment was NOT OFFERED and deferred to COR #9A. COR #9A: This amendment replaces general funds with SDPR for the following components of the Administration and Operations BRU and the Community Corrections BRU, in the following amounts. Administration and Operations Institution Director's Office (including electronic monitoring) $870,600 Combined Hiland MT Correctional Center 290,200 Cook Inlet Correctional Center 249,100 Fairbanks Correctional Center 21,000 Ketchikan Correctional Center 20,500 Lemon Creek Correctional Center 101,900 Mat-Su Correctional Center 59,100 Palmer Correctional Center 156,100 Sixth Avenue Correctional Center 883,900 Wildwood Correctional Center 15,600 Community Jails Restore: 80,700GF Electronic Monitoring 645,600 Subtotal 9,993,000 Community Corrections Community Residential Centers 811,000 Total $3,479,000 This amendment also inserts general funds to the Department of Community and Economic Development, Municipal Revenue Sharing BRU as follows. State Revenue Sharing $1,534,000 Municipal Assistance 1,866,000 Subtotal $3,400,000 Language accompanying the amendment reads as follows. Switch funding for existing correctional programs from G.F. to Statutory Designated Program Receipts as requested in the Governor's FY 2001 Budget Request and Fund Municipal Assistance and Revenue Sharing at Fiscal Year 00 Level. Restore $80.7 G.F. cut to Community Jails Fund SDPR in Electronic Monitoring +450.0/+225.0 telephone receipts - Institution Directors Ofc. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams explained that this amendment transfers the general funds that had been replaced with SDPR in COR #8A and allocates them to State Revenue Sharing and Municipal Assistance. A roll call was taken on the motion. IN FAVOR: Senator Adams OPPOSED: Senator Wilken, Senator P. Kelly, Senator Green, Senator Phillips, Senator Leman, Co-Chair Torgerson and Co- Chair Parnell ABSENT: Senator Donley The motion FAILED (1-7-1) The amendment FAILED to be adopted. COR #5: This amendment inserts $82,900 MHTAAR to the Administration and Operations BRU, Inmate Programs component to fund the Men's Substance Abuse Pilot Program. This amendment was adopted in the previous hearing. However, the Senate Finance committee substitute for HB 313 had not yet been adopted. Therefore, the action taken on the amendment was out of order. Senator Adams offered a motion to rescind the Committee's action on adopting the amendment. There was no objection and the Committee's action was RESCINDED. Senator Adams moved to adopt the amendment to the committee substitute, which had since been adopted as a workdraft. Without objection the amendment was ADOPTED. AT EASE DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT EED #3: This amendment inserts $1,800,000 TANF funds to the Early Development BRU, Child Care Assistance and Licensing component. Two previous motions to adopt this amendment were offered and subsequently withdrawn. Ms. Clarke told that the department had concluded that it was possible to reappropriate the lapsed TANF funds originally allocated to the Balloon Project to Child Care Assistance and Licensing. In order to do this, she said, an amendment to the Public Assistance Administration component would be necessary to allow the department to RSA funds into the Balloon Project. AT EASE until 4:52 PM [Due to audio equipment difficulties, there is a pause on the tape. However, no portion of the meeting is missing.] Senator Adams moved for adoption of EED #3. Senator Wilken moved to amend the amendment, replacing it with the language of EED #3C. This language is as follows. Appropriation General Other Allocation Items Funds Funds HB 312 Page 8, line 26 Delete: Child Care 65,920,300 8,396,600 57,523,700 Assistance & Licensing Insert: Child Care 66,386,300 8,862,600 57,523,700 Assistance & Licensing Page 8, line 28 Delete: Child 29,148,600 Care Assistance & Licensing Insert: Child 29,614,600 Care Assistance & Licensing General Funds saved from a fund source change in State Health Services is appropriated for childcare assistance and licensing operations. Page 13, line 28 Delete: Public Assistance 80,671,400 22,300,500 58,370,900 Administration Insert: Public Assistance 81,671,400 22,300,500 59,370,900 Administration Page 13, line 29 Delete: Public 3,227,100 Assistance Administration Insert: Public 4,227,100 Assistance Administration Increase is TANF Federal Receipts Insert new bill sections to read: "The unexpended and unobligated balance on June 30, 2000, of the appropriation made by sec. 43, ch. 84, SLA 1999, page 23, line 21 (Out-of-State Contracts), not to exceed $355,700 is appropriated to Department of Education and Early Development for operation of the child care assistance and licensing for the fiscal year ending June 30, 2001. The unexpended and unobligated balance of general funds of the appropriation made in sec. 77(b), ch. 2, FSSLA 1999 is reappropriated to the Department of Education and Early Development, child care assistance and licensing for the fiscal year ending June 30, 2001." Add immediate effective date for new sections. Appropriation General Other Allocation Items Funds Funds HB 313 Page 4, line 32 Delete: State Health 4,639,700 4,419,700 220,000 Services Insert: State Health 4,639,700 3,953,700 686,000 Services GF/MH funds in the Healthy Families component are replaced with I/A Receipts from the federal TANF block grants. Ms. Clarke described the change as an authorization to expend an additional $1 million federal funds for the Balloon Project. [The following action was taken but was not recorded.] Senator Leman stated he had no objection to the amendment to the amendment. There was no objection and the amendment was AMENDED to reflect the language in EED #3C. Tape: SFC - 99 #71, Side A Senator Leman objected to the adoption of the amended amendment. A roll call was taken on the motion. IN FAVOR: Senator Green, Senator Adams, Senator Wilken, Co- Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Leman ABSENT: Senator Phillips, Senator Donley and Senator P. Kelly The motion PASSED (5-1-3) The amended amendment was ADOPTED. UNIVERSITY OF ALASKA UNIV #10: This amendment changes the appropriation of some non-general fund sources adopted in UNIV #1 as follows. Delete: Statewide Services $9,743,800 Federal Receipts 4,159,800 UA/DFA SVC 1,000,000 Sci/Tech 3,000,000 UA/ICR 14,256,100 University Recpts Insert: Budget Reductions/ $9,505,400 Federal Receipts Additions-Statewide 4,060,300 UA/DFA SVC 1,000,000 Sci/Tech 3,000,000 UA/ICR 13,328,800 University Recpts Description: SFC UNIV #1 appropriated all non-GF funds requested by the University of Alaska for FY 01. UNIV #1 appropriated $32,159,700 non-GF funding for the University, of which $1,265,200 was requested for salary maintenance. This amendment rescinds the funding appropriated in UNIV #1 and appropriates all non-GF funding requested in the University's FY 01 operating budget, excluding the non-GF funding for salary maintenance. Senator Leman moved for adoption and explained the relevance to UNIV #1, which the Committee adopted in the previous hearing. He stated that UNIV #1 inadvertently contained general fund allocations to employee contracts. He expressed that because the intent was to address all state employee contracts separately, this amendment removes that allocation and is essentially a technical amendment. There was no objection and the amendment was ADOPTED. DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES DOT #7: This amendment makes the following changes to the committee substitute. Page 27, following line 27 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Statewide Facility Maintenance and Operations is reduced by $436,006 in other funds. The reduction in this appropriation shall occur as a reduction of $65,000 in the allocation for Central Region Facilities, a reduction of $242,000 in the allocation for Northern Region Facilities, and a reduction of $129,000 in the allocation for Southeast Region Facilities. Page 28, following line 15 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Central Region Highways and Aviation is reduced by $65,000 in other funds. Page 28, line 16 Delete: The allocation for Central Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Insert: The appropriation for Central Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Page 28, following line 24 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Northern Region Highways and Aviation is reduced by $336,600 in other funds. Page 28, line 25 Delete: The allocation for Northern Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Insert: The appropriation for Northern Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Page 28, following line 29 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Southeast Region Highways and Aviation is reduced by $46,500 in other funds. Page 28, line 30 Delete: The allocation for Southeast Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Insert: The appropriation for Southeast Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Co-Chair Torgerson moved for adoption and explained that the purpose of the amendment is to clarify the intent if HB 112, which established the Alaska public building fund, does not become law. This bill contains a revenue generating fiscal note, he detailed, which is the funding source for the amendments relating to increased funding allocated to cover the expense of higher fuel costs. He stated that the language of this amendment stipulates that if the pending legislation does not become law and the funding source is not realized, the department is directed to reduce its budget by the amount allocated by the amendments. Co-Chair Torgerson moved to amend the amendment to replace "other funds" with "public building funds" wherever it appears in the amendment. The amended amendment reads as follows: Page 27, following line 27 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Statewide Facility Maintenance and Operations is reduced by $436,006 in public building funds. The reduction in this appropriation shall occur as a reduction of $65,000 in the allocation for Central Region Facilities, a reduction of $242,000 in the allocation for Northern Region Facilities, and a reduction of $129,000 in the allocation for Southeast Region Facilities. Page 28, following line 15 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Central Region Highways and Aviation is reduced by $65,000 in public building funds. Page 28, line 16 Delete: The allocation for Central Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Insert: The appropriation for Central Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Page 28, following line 24 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Northern Region Highways and Aviation is reduced by $336,600 in public building funds. Page 28, line 25 Delete: The allocation for Northern Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Insert: The appropriation for Northern Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Page 28, following line 29 Insert: If legislation establishing the public building fund is not passed by the Twenty-First Alaska State Legislature and enacted into law, then the amount appropriated for Southeast Region Highways and Aviation is reduced by $46,500 in public building funds. Page 28, line 30 Delete: The allocation for Southeast Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Insert: The appropriation for Southeast Region Highways and Aviation shall lapse into the general fund on August 31, 2001. Senator Adams noted the high fuel costs if the HB 112 does not pass. He did not object to the amendment to the amendment. AT EASE 5:01 PM / 5:05 PM Co-Chair Torgerson clarified that the Division of Legislative Finance and the Division of Legal and Research Services could make the determination as to whether the changes in the amendment to the amendment were necessary and make technical adjustments accordingly. There being no objection, the amendment was AMENDED. Co-Chair Parnell commented that no commitment for a supplemental budget is made and that the department is instructed to reduce its appropriation if the funding is not provided by HB 112. The amended amendment was ADOPTED. DEPARTMENT OF HEALTH AND SOCIAL SERVICES H&SS #1: This amendment inserts $1,387,000 general funds to the Juvenile Justice BRU, Mat-Su Youth Facility component, and inserts $1,138,000 general funds to the Juvenile Justice BRU, McLaughlin Youth Center component. Language accompanying the amendment reads as follows. This amendment increases funding for the operation of the new 15-bed facility serving the Matanuska-Susitna area by $1,387,000 in order to fund operation of the facility beginning July 1, 2000. This amendment also increases funding for the McLaughlin Youth Facility to allow for operation of the new 30-bed facility effective July 1, 2000. Senator Green moved for adoption. Senator Adams agreed with the allocation but asked if there was sufficient funding to operate the Ketchikan Regional Youth Facility. Co-Chair Parnell assured the matter would be addressed in an amendment to the amendment. Senator Green spoke of the construction of the Mat-Su facility and addition to the McLaughlin facility. She stated that it was now time to open the facilities, which this amendment supplies funding for. She added that the proposed amendment to the amendment appropriates funds to open the Ketchikan facility when construction is complete in the spring of 2001. Senator Green moved to amend the amendment, replacing the language with language contained in H&SS #1A. This language reads as follows. Appropriation General Other Allocation Items Funds Funds Page 13, line 25 Delete: Medicaid Services 446,405,100 105,323,000 341,082,100 Insert: Medicaid Services 446,405,100 103,611,600 341,082,100 Page 15, line 6 Delete: McLaughlin 10,078,500 Youth Center Insert: McLaughlin 11,380,500 Youth Center Page 15, line 11 Delete: Mat-Su 174,800 Youth Facility Insert: Mat-Su 584,200 Youth Facility Insert new bill sections to read: The unexpended and unobligated balance on June 30, 2000 of the appropriation made by sec. 43, ch. 84, SLA 1999, page 23, line 21 (Out-of-State Contractual) not to exceed $615,000 is appropriated to Mat-Su Youth Facility. The unexpended balance of the appropriation made by sec. 43, ch. 84, SLA 1999, page 7, line 26 (Out-of- State Contractual) not to exceed $98,000 is appropriated to the Ketchikan Regional Youth Facility. Provide funds for the operation of the new youth facilities (or expansion of facilities) opening in FY 01. Co-Chair Parnell explained this amendment to the amendment adds the Ketchikan facility to the list of facilities receiving funding. He stated that construction and expansion of the three aforementioned facilities were authorized by the legislature in prior years. He continued that the amendment to the amendment provides non-general funds, in this case, lapsed funds appropriated for out-of- state contracts plus funds from a Medicaid services reduction. He said that reduction would be discussed later in the meeting. Senator Adams cited a letter written by Senator Taylor stating that the opening date of the Ketchikan facility is March 1, 2001. If the facility opened at this date, according to Senator Taylor, the facility would require $283,000 to operate rather than the $98,000 provided in the amendment to the amendment. Co-Chair Parnell relayed that Senator Taylor and the department expressed to him that $98,000 is the correct amount needed by the facility. Senator Phillips asked for details of the Medicaid services reduction. AT EASE 5:10 PM / 5:19 PM Ms. Clarke noted the Hospital Pro-Share Program is utilized in order for the state to reach its "cap" for Medicaid expenditures. The funds utilized in this amendment, she stated, would come from efforts to receive pro-share funding retroactively from previous year. Ms. Clarke detailed the funding mechanism of the state's publicly operated hospitals and how some of the funds provided to the hospitals would return to the state as SDPR. She listed some of the qualifying hospitals that local governments operate as, Bartlett Regional Hospital in Juneau, and the hospitals in Cordova, Kodiak, Valdez, Wrangell and Petersburg. Senator Adams wanted to know how the state could be assured that the projected 90 percent of allocated funding would be returned. Ms. Clarke answered that in order to participate the hospitals must sign an agreement to return 90 percent of the funds within five days. She stated that the returned funds have to be spent in the Medicaid program, but noted that this method requires less expenditure of general funds to operate the program. Co-Chair Parnell noted this funding mechanism is technical and that the House of Representatives utilized this as well. He emphasized that many other states also employ this program. Ms. Clarke reminded that a subsequent amendment would be needed to establish the retroactive Hospital Pro-Share program. Senator Leman did not understand the 90 percent return and asked what the hospitals would receive in exchange for participating. Ms. Clarke agreed the program had to be designed to improve quality and access to services. She pointed out that the participating hospitals are smaller facilities that have a difficult time maintaining solvency and that this program would provide $2 million to the ten qualified hospitals. She explained the reason the program was allowable was because locally owned and operated county hospitals in many states provide the match for the Medicaid program. Senator Leman had thought that the state Medicaid expenditure was what the state paid to the hospital for services they provide. Ms. Clarke expounded this program is an additional payment above any regular Medicaid claim. Senator Phillips asked if this concept was being attempted for the first time. Co-Chair Parnell said it was for Alaska but has been done in other states. A roll call was taken on the motion to amend the amendment. IN FAVOR: Senator Wilken, Senator P. Kelly, Senator Green, Senator Leman, Senator Adams, Co-Chair Torgerson and Co- Chair Parnell OPPOSED: Senator Phillips ABSENT: Senator Donley The motion PASSED (7-1-1) The amendment was AMENDED. A roll call was taken on the motion to adopt the amendment as amended. IN FAVOR: Senator Leman, Senator Adams, Senator Wilken, Senator P. Kelly, Senator Green, Co-Chair Torgerson and Co- Chair Parnell OPPOSED: Senator Phillips ABSENT: Senator Donley The motion PASSED (7-1-1) The amended amendment was ADOPTED. H&SS #2: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 15, line 12 Delete: Ketchikan 23,100 Regional Youth Facility Insert: Ketchikan 283,200 Regional Youth Facility It has now been established that this facility will be open on March 1, 2000. Funding needs were not included in the House bill as a later opening date had been anticipated. This amendment was NOT OFFERED due to action taken on H&SS #1. H&SS #3: This amendment inserts $294,400 general funds to the State Health Services BRU, Infant Learning Grants component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams reminded that the Infant Learning Grants issue had been debated at the previous hearing. Co-Chair Torgerson moved to amend the amendment to replace the general funds with federal funds. Co-Chair Parnell explained that the federal funds would actually be inter-agency receipts that would be received by the Alcohol and Drug Abuse Administration component for the FASFAE program. He said this fund source change makes use of additional federal funds. Senator Leman pointed out that if the fund transfer were made but no additional funds allocated to the infant learning program, the general fund spending would be reduced by $300,000. Co-Chair Parnell acquiesced. AT EASE 5:32 PM / 5:37 PM Co-Chair Parnell clarified the fund source and the transfer of funds. He stated that this amendment transfers $294,400 FASFAE federal funds to the Infant Learning Grants because of the direct connection of the program. Without objection the amendment was AMENDED. Senator P. Kelly stated that this amendment has a neutral general fund affect, contrary to Senator Leman's comment stating otherwise. Senator Leman wanted to understand the connection between the Infant Learning Grants program and FASFAE. Senator P. Kelly explained the FASFAE makes multiple reference to children, both in prevention and in treatment capacities. Senator Leman wanted assurance that this allocation would be used for the FASFAE purposes rather than directed to another program. Senator P. Kelly answered that the grant has parameters that require funds to go to qualifying children. There was no objection and the amended amendment was ADOPTED. H&SS #4: this amendment inserts $278,600 federal funds, $278,600 GF-Match funds, and $514,200 general funds to the Front Line Social Workers BRU, Front Line Social Workers component. Language accompanying the amendment reads, "to reduce the vacancy and turnover rate for Front Line Social Workers." This amendment was held at this time and subsequently NOT OFFERED. H&SS #5: This amendment replaces $500,000 I/A funds with general funds in the Alcohol and Drug Abuse Services BRU, Alcohol and Drug Abuse Grants component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams noted that the subcommittee recommended funding this component with inter-agency receipts in the expectation that the Community Prevention Grant component of the FASFAE would cover the allocation. However, he stressed, substance abuse, prevention and treatment block grants, does not qualify for this funding source. He warned that to utilize the federal funds in this manner would result in federal penalties. Senator Adams added that failure to adopt this amendment would result in a loss of $241,000 federal funds in the year 2002 and a loss of $250,000 in FY 2003. Subsequently, he continued, 8,000 individuals would be denied treatment in the alcohol and drug abuse program, by FY 2003. AT EASE 5:41 PM / 5:46 PM Senator Adams stated that he was trying to ensure matching federal funds for future years. However, he noted he would have to research the matter further. Without objection, Senator Adams WITHDREW his motion to adopt the amendment. The amendment was NOT OFFERED again. H&SS #6: This amendment inserts $29,800 federal funds and $1,103,300 general funds to the Purchased Services BRU, Foster Care Special Needs component. This amendment deferred to H&SS #14 and was NOT OFFERED. H&SS #7: This amendment inserts $300,000 general funds to the Purchased Services BRU, Foster Care Augmented Rate component. This amendment deferred to H&SS #14 and was NOT OFFERED. H&SS #8: This amendment inserts $396,500 federal funds and $482,300 GF/Match to the Purchased Services BRU, Subsidized Adoption and Guardianship component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams explained that the number of children provided permanent homes through subsidized adoption and guardianship program has increased significantly over the past several years. He noted that the increase between 1992 and 1999 was 258 percent. He stressed the need to continue to fund this program saying that there was currently insufficient funding. Co-Chair Parnell agreed guardianships were important but was concerned about the general fund source. Co-Chair Torgerson moved to amend the amendment to replace the GF/Match funds with ILTF funds. Without objection the amendment was AMENDED. Senator Phillips stated he was unfamiliar with the ILTF funding source. Co-Chair Parnell pointed out that the Committee had recently adopted two other amendments using this funding source. He explained that a balance of $482,300 remains in the ILTF and that he was prioritizing this program to receive those funds. Senator Leman asked about the Subsidized Adoption and Guardianship program. He wanted to know if the funds would be subsidizes to adoptive parents or go to fund department operations. Co-Chair Parnell replied that the funds are provided as subsidizes for adoptive parents. Ms. Clarke explained that all the funds in this program are paid out as subsidizes to the parents who provide guardianship or adopt a special needs child. She added that federal funds are also received by the department and are used towards these payments. She stressed that none of the funds are used to fund state positions. Senator Leman asked how large the subsidizes were. Ms. Clarke replied that the amount is calculated on an individual basis, but average $17 per day, depending on the child's needs. She compared this to the payment for foster care, which averages between $30 to $34 per day. Senator Leman asked if the payments continue after the adoption is complete. Ms. Clarke responded that the payments continue until the child reaches the age of 18. There was no objection and the amended amendment was ADOPTED. H&SS #9: This amendment adds general funds to the Juvenile Justice BRU, McLaughlin Youth Center, Mat-Su Youth Facilities, Ketchikan Regional Youth Facility and Bethel Youth Facility components. The amounts are as follows. $1,302,000 for staffing the new 30-bed unit at the McLaughlin Youth Center $1,213,000 for phased opening at the Mat-Su Youth Facility $276,600 to open the Ketchikan Regional Youth Facility $85,300 to address overcrowding at the Bethel Youth Facility Senator Adams requested this amendment be HELD while he attempted to locate a funding source for the Bethel Youth Facility portion of the amendment. AT EASE until 6:02 PM Senator Adams moved to amend and adopt the amendment. The amendment to the amendment deletes all components except the Bethel Youth Facility and changes the funding source from general funds to federal funds. Senator Adams stressed the need for funding to address overcrowding in the Bethel Youth Facility. He noted that the federal funds are reallocated from the Medical Services component. Co-Chair Parnell pointed out that this reallocation uses the same method as employed in H&SS #1. There was no objection and the amendment was AMENDED and ADOPTED. H&SS #10: This amendment inserts $188,600 tobacco settlement funds to the State Health Services BRU, Tobacco Control and Prevention component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams relayed the very recent US Supreme Court decision ruling that the Federal Communications Commission (FCC) lacks jurisdiction over cigarette and smokeless tobacco advertising. As a result, he stressed the state loses a $200,000 FCC grant immediately. He spoke of the need to continue tobacco education and prevention efforts. Senator Adams noted the anticipated receipt of $20,923,000 from the tobacco settlement as compared to $27,941,000 the previous year, of which $1.4 million was appropriated. His intent was to keep the appropriation level the same as in the previous year. Co-Chair Parnell spoke to a proposed amendment to the amendment, which changes the amendment as follows. Appropriation General Other Allocation Items Funds Funds Page 13, line 25 Delete: Medicaid Services 446,405,100 105,323,000 341,082,100 Insert: Medicaid Services 446,405,100 105,134,400 341,082,100 Page 17, line 16 Delete: Tobacco 1,211,400 Prevention & Control Insert: Tobacco 1,400,000 Prevention & Control Funds available as a reduction of pro share in the House bill for Medicaid services will provide funding for this increment. Co-Chair Torgerson moved to amend the amendment to reflect the above language. Co-Chair Parnell stated that this changes the allocation so that it is not simply a general fund addition. He explained that this reduces the allocation to Medicaid Services by $188,600 and funds the Tobacco Prevention and Control component at the same amount. Without objection the amendment was AMENDED. There was no objection to the amended amendment and it was ADOPTED. H&SS #11: This amendment inserts $25,000 general funds to the Administrative Services BRU, COMPASS Community Grants component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams defined the COMPASS program as a "community partnership for access, solution and success for youth." He explained that this amendment would provide communities with the seed money to initiate programs that provide quality after-school, evening and weekend programs for youths. He stressed that participating communities provide matching funds for this grant. Senator Adams emphasized that the history of this grant program ensures continued success. He shared that the grant program provided start-up funds for programs in North Pole, Juneau, Koyuk and Mountain Village. Senator P. Kelly noted that when originally proposed the request was for $100,000 and has since been reduced to $25,000. He pointed out that the budget already funds several programs targeted at assisting youths with their education, including Headstart and Infant Learning. He did not think this additional program was necessary. A roll call was taken on the motion. IN FAVOR: Senator Adams OPPOSED: Senator Green, Senator Phillips, Senator Leman, Senator Wilken, Senator P. Kelly, Co-Chair Torgerson and Co-Chair Parnell ABSENT: Senator Donley The motion FAILED (1-7-1) The amendment FAILED to be adopted. H&SS #12: This amendment inserts $506,600 general funds to the Abortion Services for Medicaid Eligible Women BRU and component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams spoke to the judgement issued be the superior court of Alaska and pointed out that the Medical Assistance program lacks an appropriation for this service. Senator P. Kelly relayed a discussion during subcommittee meetings where it was determined that the subcommittee was not the proper place to debate this matter. He did not think the full Senate Finance Committee was the place either. He alluded to the issue regarding the separation of powers prescribed in the Alaska Constitution. Senator Adams emphasized the consequences of failing to fund this component with the possibility of a contempt of court order and potential financial sanctions in the future. Co-Chair Parnell assured that the matter was still on appeal before the Alaska Supreme Court. He urged members to vote against this amendment. A roll call was taken on the motion. IN FAVOR: Senator Adams OPPOSED: Senator Phillips, Senator Leman, Senator Wilken, Senator P. Kelly, Senator Green, Co-Chair Torgerson and Co- Chair Parnell ABSENT: Senator Donley The motion FAILED (1-7-1) The amendment FAILED to be adopted. H&SS #13: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 16, line 27 Delete: State Health 79,545,600 23,430,800 56,114,800 Services Insert: State Health 79,538,300 23,423,500 56,114,800 Services Page 17, line 5 Delete: Bureau 1,504,600 Of Vital Statistics Insert: Bureau 1,497,300 Of Vital Statistics Justification: This amendment provides the general fund amount necessary to fund the marijuana registry, as proposed by the department in its fiscal note to CS SS SB 94 (HES). Senator Leman moved for adoption. Co-Chair Parnell objected. Senator Leman stated that this amendment provides $73,000 for the marijuana registry and makes the operating budget consistent with the fiscal note for the legislation establishing this registry. He noted that it would not be necessary to fund the computer and workstation expenses every year. Co-Chair Parnell asked if the budget subcommittee examined the issue. Senator P. Kelly responded that while the subcommittee did visit the issue, it had not followed through and included funding for the registry in its recommendations. He stated he would not object to the amendment. Co-Chair Parnell removed his objection. There was no objection and the amendment was ADOPTED. H&SS #14: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 13, line 25 Delete: Medicaid Services 446,405,100 105,323,000 341,082,100 Insert: Medicaid Services 446,405,100 103,611,000 341,082,100 Page 14, line 19 Delete: Foster Care 2,986,800 Augmented Rate Insert: Foster Care 4,098,800 Augmented Rate Page 14, line 20 Delete: Foster Care 2,427,000 Special Needs Insert: Foster Care 2,727,000 Special Needs To provide needed funding for Foster Care. The State is able to realize a savings by implementing the pro share plan in the Medicaid program. Co-Chair Torgerson moved for adoption. Co-Chair Parnell explained this amendment reduces the allocation to Medicaid Services by $1,711,400 and adds that amount to Foster Care Augmented Rate and the Foster Care Special Needs components. He stated that this amendment provides needed funding for the foster care program. Co-Chair Torgerson declared a conflict of interest due to his operation of a foster care home. Co-Chair Parnell ruled Co-Chair Torgerson would be required to vote on the amendment. Co-Chair Parnell noted that the funds in this program are paid to foster parents rather than as a subsidy to the department. There was no objection and the amendment was ADOPTED. AT EASE 6:13 PM / 6:20 PM Tape: SFC - 00 #71, Side B 6:20 PM DEPARTMENT OF CORRECTIONS COR #6: This amendment inserts $70,000 SDPR to the Administration and Operations BRU, Institutions Director's Office component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams pointed out that the SDPR are federal contract funds provided by Education Service District #101, a school district within the State of Washington. He continued that this program provides distance education services to juveniles incarcerated in adult facilities. He referred to a list of studies and programs and the equipment that the distance education service would provide. Co-Chair Parnell asked how this appropriation fit the definition of Statutory Designated Program Receipts. DWAYNE PEEPLES, Director, Division of Administrative Services, Department of Corrections responded that the funds come to the department under a contract arrangement with the Washington state school district. Co-Chair Parnell asked if the funds come directly from the federal government. Mr. Peeples replied that the funds come from the school district, which contracts with the department to provide the educational services. There was no objection and the amendment was ADOPTED. DEPARTMENT OF ADMINISTRATION ADM #8: This amendment reduces the amount of general funds allocated to the Leases BRU, Leases component by $25,000. It then increases the allocation to the Public Communications Services BRU, Public Broadcasting-Radio component by $25,000 general funds. Senator Wilken moved for adoption. Co-Chair Parnell objected. Senator Wilken refreshed members on the debate held at the previous meeting on this issue. He spoke of testimony heard at that meeting stating that the proposed $130,000 funding reduction would damage the public radio system. He shared that while he had requested, but not received, information about potential impacts earlier in the subcommittee process, that information was provided to him after the previous hearing had adjourned. He said the Public Broadcasters Commission calculated it would need $50,000 to maintain solvency. This amendment reflects that request with the funding source being the Leases BRU, he stated. He noted that the Leases BRU were already underfunded by $800,000 and that a supplemental budget request may be necessary in the next legislative session. Senator Adams appreciated the $50,000 addition although he said the originally requested $130,000 would have been preferred. Senator Green wanted to prevent the closure of any radio station and said this allocation should do that. Co-Chair Parnell removed his objection. The amendment was ADOPTED without objection. DEPARTMENT OF HEALTH AND SOCIAL SERVICES H&SS #15: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 13, line 25 Delete: Medicaid 446,405,100 105,323,000 341,082,100 Services Insert: Medicaid 437,848,100 96,766,000 341,082,100 Services Page 45, following line 5 Insert a new bill section to read: Sec. __. MEDICAID PRO-SHARE. (a) The sum of $9,960,000 in general funds appropriated in section 43, CH 84, SLA 1999, page 30, line 31 (Medicaid Services - $392,343,100), lapses into the general fund June 30, 2001. (b) The sum of $29,960,000 is appropriated to the Department of Health and Social Services, Medicaid Services, for the fiscal year ending June 30, 2000 from the following sources: Federal Funds $11,960,000 Statutory Designated $18,000,000 Receipts (c) The appropriation made by (b) of this section is conditioned upon the Department of Health and Social Services establishing a program of additional payments to insure access for community hospitals under a distribution methodology approved by the Heath Care Financing Administration for government owned and operated hospitals in Alaska. Hospitals that choose to participate must sign an agreement by May 17, 2000, to return 90% of the additional payment amounts to the State Of Alaska. Additional language accompanying the amendment states, "The appropriations in (a) and (b) of this section take effect immediately in accordance with AS 01.10.070(c)." This amendment was NOT OFFERED, as a technical change was necessary. H&SS #16 was acted upon in its place. AT EASE 6:25 PM / 6:32 PM DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT EED #5: [This amendment was adopted earlier in the meeting.] Senator Wilken explained that the earlier adopted language was incorrect according to the Division of Legislative Legal and Research Services. Senator Wilken offered a motion to rescind the Committee's action in adopting the amendment. There was no objection and the action was RESCINDED. Senator Wilken moved to amend the amendment to replace the existing language with language contained in EED #5B. That language reads as follows. Page 43, following line 3 Insert a new bill section to read: Sec. 13. LEARNING OPPORTUNITY GRANTS. The unexpended and unobligated balance on June 30, 2000, of the appropriation made by sec. 43, ch. 84, SLA 1999, page 23, line 30 (K-12 Support - $762,280,800), not to exceed $5,787,100, is reappropriated to the Department of Education and Early Development for the fiscal year ending June 30, 2001, for payment as grants to each school district in an amount equal to the school district's average daily membership multiplied by $43.75 as Learning Opportunity Grants to pay the costs of supplemental student instructional programs to improve student performance on the high school graduation examination or benchmark examinations for the fiscal year ending June 30, 2001. The department shall by regulation establish a process to implement this section. Without objection or discussion, the amendment was AMENDED. Senator Leman opposed adoption of the amended amendment. A roll call was taken on the motion to adopt the amended amendment. IN FAVOR: Senator Adams, Senator Wilken, Senator P. Kelly, Senator Green, Co-Chair Torgerson and Co-Chair Parnell OPPOSED: Senator Leman ABSENT: Senator Donley and Senator Phillips The motion PASSED (6-1-2) The amendment as amended was ADOPTED. AT EASE 6:36 PM LEGISLATURE LEG #1: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 31, lines 16 and 17 Delete: Legislative Council 20,786,800 20,721,800 65,000 Salaries 4,151,300 & Allowances Insert: Legislative Council 20,633,800 20,568,800 65,000 Salaries 4,151,300 & Allowances Page 31, following line 17 Insert: It is the intent of the legislature that long- term per diem not be paid to legislators unless specifically authorized by a standing committee or an interim committee of the legislature. Senator Phillips moved for adoption. Co-Chair Parnell objected. Senator Phillips recounted when he was first elected into the legislature in the 1970s, when per diem was not paid during the legislative interim. He felt that there had been recent "liberalization" in the collection of these payments. He expressed that "the public deserves more" than to pay this per diem to legislators who have legislative offices within 50 miles of their home. He did believe that when legislative duties take a legislature farther than 50 miles of their home, the per diem was appropriate. He was concerned about legislators taking advantage of the per diem system without any limitations. Senator Leman suggested addressing the matter of "in session" per diem. Senator Phillips responded that this amendment only addresses per diem paid during the legislative interim. Co-Chair Torgerson stated that this amendment would not accomplish anything as the presiding officers of the House of Representatives and the Senate had handed over the authority to approve interim per diem to the Legislative Council. Co-Chair Torgerson declared a conflict of interest as the chair of a standing committee. Co-Chair Parnell ruled Co-Chair Torgerson would be required to vote on the amendment. Co-Chair Parnell noted that all members could declare a conflict of interest as they potentially could collect interim per diem. Co-Chair Parnell pointed out for the benefit of the public that through the federal government's calculations of cost of living, the legislators per diem has been reduced by eight percent in the current year. He stressed that if there has been abuse of the legislative interim per diem system, that abuse must be addressed at the Legislative Council level. A roll call was taken on the motion. IN FAVOR: Senator Phillips OPPOSED: Senator Adams, Senator Wilken, Senator P. Kelly, Senator Green, Senator Leman, Co-Chair Torgerson and Co- Chair Parnell ABSENT: Senator Donley The motion FAILED (7-1-1) The amendment FAILED to be adopted. DEPARTMENT OF CORRECTIONS COR #7: This amendment inserts $450,000 SDPR to the Administration and Operations BRU, Electronic Monitoring component. Senator Adams moved for adoption. Co-Chair Parnell objected. Senator Adams stated that this amendment would allow the department to expand the electronic monitoring program. He noted 70 additional inmates from Mat-Su, Juneau, Kenai, Fairbanks, Anchorage and Ketchikan facilities could participate. He pointed out that the participating inmates pay the full cost of operating the program. He expressed that this program is a cost-effective alternative to prison and is a good tool for enforcing curfews and monitoring offenders. A roll call was taken on the motion. IN FAVOR: Senator Adams OPPOSED: Senator Leman, Senator Wilken, Senator P. Kelly, Senator Green, Senator Phillips, Co-Chair Torgerson and Co- Chair Parnell ABSENT: Senator Donley The motion FAILED (1-7-1) The amendment FAILED to be adopted. At ease 6:43 PM / 6:53 PM DEPARTMENT OF HEALTH AND SOCIAL SERVICES H&SS #16: This amendment makes the following changes to the committee substitute. Appropriation General Other Allocation Items Funds Funds Page 13, line 25 Delete: Medicaid 446,405,100 105,323,000 341,082,100 Services Insert: Medicaid 440,141,800 99,059,700 341,082,100 Services Page 45, following line 5 Insert a new bill section to read: Sec. __. MEDICAID PRO-SHARE. (a) The sum of $9,960,000 in general funds appropriated in section 43, CH 84, SLA 1999, page 30, line 31 (Medicaid Services - $392,343,100), lapses into the general fund June 30, 2001. (b) The sum of $29,960,000 is appropriated to the Department of Health and Social Services, Medicaid Services, for the fiscal year ending June 30, 2000 from the following sources: Federal Funds $11,960,000 Statutory Designated $18,000,000 Receipts (c) The appropriation made by (b) of this section is conditioned upon the Department of Health and Social Services establishing a program of additional payments to insure access for community hospitals under a distribution methodology approved by the Heath Care Financing Administration for government owned and operated hospitals in Alaska. Hospitals that choose to participate must sign an agreement by May 17, 2000, to return 90% of the additional payment amounts to the State Of Alaska. Additional language accompanying the amendment states, "The appropriations in (a) and (b) of this section take effect immediately in accordance with AS 01.10.070(c)." Co-Chair Torgerson moved for adoption. Co-Chair Parnell explained this amendment funds the pro- share mechanism as discussed extensively during this and the previous hearing. Ms. Clarke explained this amendment would allow the hospital pro-share program to be implemented retroactively for FY 00. She stated that although a plan was not currently in place, the conditional appropriation language in this amendment gives the department protection to negotiate with the eligible hospitals. She continued that the future pro-share program would follow the normal regulation process for implementation. However, she pointed out, the department would not have adequate time to follow the normal procedures and still impact the FY 01 budget. She spoke of a proposed second contingent appropriation in the event that no hospitals chose to participate, or if the state is sued in its attempt to garner these funds. Co-Chair Parnell agreed it was possible that no hospitals would chose to participate, but noted that even if only one hospital applies, that hospital would receive the entire pro-share grant. He shared that the grant is a set amount to be divided among all participating hospitals. There was no objection and the amendment was ADOPTED. AT EASE 6:57 PM / 7:04 PM Co-Chair Parnell announced HB 312 would be HELD until the next day to allow the figures to be calculated.