SB 124-ALCOHOLISM AND DRUG ABUSE GRANTS  CHAIR DYSON announced SB 124 to be up for consideration. MR. ELMER LINDSTROM, Special Assistant to Commissioner Gilbertson, Department of Health and Social Services (DHSS), said SB 124 is very straightforward. He thought these grants are the only ones that require a state match that is specified in statute. Typically, the local match is 25%. [SB 124] would actually save state general funds with the expectation that the state grant funds would be replaced by larger matches provided by local communities. He said the bill has four fiscal notes and a spreadsheet is available that lists all of the grants provided by the division based on FY 03 activity. CHAIR DYSON asked which programs are protected from the match increase from 75% to 90%. MR. LINDSTROM referred the committee to the second column of the spreadsheet entitled "Notes," [which lists] a number of exemptions from the match. They are grants of $30,000 or less with the assumption that they would have a very difficult time making any local match requirement. For the most part they are associated with the community based suicide prevention program ($10-$17,000 grants) and grants to the very small communities throughout Alaska. A number of items are in the 10% column and those have been held harmless for the increase in the local match requirement. Those are programs that provide treatment services for families, particularly for women with children. The fiscal note was predicated on those assumptions. MR. LINDSTROM noted that under existing law, the department has the ability to waive the local match requirement and that is their intent - as indicated on the spreadsheet. He thought there would be requests from other grantees to waive the match in whole or in part. Any relief given to another grantee would by definition be at the expense of someone else and he assumed what would happen would be very close to what is described on the spreadsheet. SENATOR DAVIS asked if he would consider in-kind contributions or volunteer labor as a match to make up the 25%. MR. LINDSTROM said he didn't know for certain, but he thought some types of in-kind support might be accepted. 2:05 p.m. MS. KAREN PEARSON, Acting Director, Division of Alcoholism and Drug Abuse, added that the in-kind match could probably be managed, but because of the change in the fiscal note, it will mean a decrease in actual dollars going to that grantee. SENATOR GUESS asked her how DHSS determined who would be exempt. MR. LINDSTROM replied that he thought the rule was $30,000 or less or providing treatment services to families, particularly women with children. He asked her if she was referring to a unique situation. SENATOR GUESS said the Alaska Military Youth Academy and Community Prevention [grants] were less than $30,000 but they still have a match. She was trying to understand that. MR. LINDSTROM admitted she was correct and said he would try to find out why. SENATOR GUESS added there are a handful of such cases and asked why the Fairbanks Memorial Hospital was held harmless. MR. LINDSTROM said he didn't know, but would find out. SENATOR GUESS said she wouldn't waste the committee's time, but would give him a list of her concerns afterwards and he could get back to her with information. She asked how 25% was chosen and not something based on wealth in a community. MR. LINDSTROM replied the reason is because that tends to be the norm in the department. SENATOR GUESS asked how many waivers DHSS provides now with 10%. MR. LINDSTROM replied that he thought the community-based suicide projects have historically been waived from the local community match. The ASAP programs have not had a match historically, but he thought the grantees had a provision for sliding fee scales. He knew that some of them had been fairly aggressive in that respect, but it hadn't been shown as a match requirement. Those are the two that leapt out at him when he reviewed the document. SENATOR GUESS asked how many on the list that normally received waivers in the past would not receive waivers under the $30,000 rule. MR. LINDSTROM said he would have to tabulate that for her. SENATOR GUESS asked how he determined the $30,000. MR. LINDSTROM replied that it was as simple as looking at the total project cost that determined whether or not something was greater or lesser than $30,000. SENATOR GUESS asked why DHSS picked $30,000 as a number. MR. LINDSTROM replied that he didn't know. SENATOR GUESS asked if it was a policy call by the department and whether anything in regulation or statute says there is no match for grants that are $30,000 or less. MR. LINDSTROM replied that is correct, but the community-based suicide prevention projects have historically been exempt for the local match requirement and they are all under $20,000. There will be an administrative process where the division will petition the commissioner for approval to waive the local match requirement and the commissioner would make the decision. SENATOR GUESS asked if that is the current process and whether DHSS is changing it. MR. LINDSTROM replied DHSS is not changing the process. SENATOR GUESS referred to the department's statement that there would be no impact on services at the community level and asked whether DHSS had done an analysis of any decreases. She thought local communities would have to either raise taxes or, in places like Anchorage with a tax cap, choose to fund those services and not fund something else. She asked if DHSS had done an estimate of the services he thought would be impacted. MR. LINDSTROM replied that DHSS had not done so and that she is correct, but it was DHSS's belief that by exempting the small grantees, the others would have the ability to come up with the local match. He based that assumption on DHSS's experience with other grant programs. CHAIR DYSON noted that very few of the programs fall close to the $30,000 rule. SENATOR GUESS asked whether the community match funds come from a city or a borough. Basically, she wanted to know what the restrictions are for the match relating to Senator Davis's question about in-kind matches. MS. PEARSON responded that the grantee has the responsibility to find the match. Grantees sometimes get the funds from another entity, but the administrative entity handling the cash has to be the grantee. CHAIR DYSON announced an at-ease from 2:05 to 2:06 p.m. SENATOR GREEN moved to pass SB 124 with its accompanying fiscal notes from committee with individual recommendations. There were no objections and it was so ordered.