SB 289-TECH & VOC EDUC/EMPLOYMENT ASSISTANCE MS. MARY JACKSON, Legislative staff for Senator John Torgerson, stated SB 289 will focus the efforts of the State on technical and vocational education into one board, and SB 289 will provide additional funding for that effort. SB 289 will also become a vehicle within the new board for new federal funding. Senator Torgerson has a proposed committee substitute that makes technical corrections to SB 289. SENATOR KELLY moved to adopt the CS for SB 289 (L&C) (version H) as the working draft of the committee. Without objection, the motion carried. MS. JACKSON explained the differences between SB 289 and CSSB 289. On page 8, line 22, "75 percent", was replaced with ".75 percent". SENATOR LEMAN suggested using a zero before ".75 percent", to avoid confusion. MS. JACKSON stated on page 5, line 30, a new subsection (b) was inserted. It formally places the current State training and employment program under the office of the new board. On page 9, line 9-25, new language was inserted. It increased the funding amount to 3/10 of one percent, and half will come from employees and half will come from employers as a contribution. SENATOR LEMAN stated the funding that was increased is false. If it is to be 3/10 of one percent, the figure needs to say 3/1000, and "percent" needs to be deleted. MS. JACKSON stated yes. The intent is for the figure to be 3/10 of one percent. The word "percent" should be deleted and the figure should say "3/1000". CHAIRMAN MACKIE stated the drafters would correct the mistake. MS. JACKSON stated the last change was made on page 12, line 18. It is transitional language that accommodates the first year of funding for the program. The intent is to assure that funds are distributed from the new source. Because the new board will not have been in place and able to go through a notification process for grants to all entities, those funds will be available and they will be distributed for that first year as is provided in the language. Senator Torgerson feels strongly that the efforts need to be focused on one board with authority, and accountability, and that is how SB 289 would work. SENATOR KELLY asked if there was legislative confirmation of the board. MS. JACKSON answered yes. SENATOR LEMAN asked if the consolidation of this board would lead to the elimination of other boards. MS. JACKSON stated with the inclusion of the step program in the committee substitute, funds will remain given to the Alaska Human Resource Council (AHRIC) committee, but the funding would decrease. SENATOR LEMAN asked if AHRIC would still exist. MS. JACKSON stated yes. MR. MIKE ANDREWS, Executive Director of AHRIC, stated AHRIC believes these types of grants are important for employers, workers, vocational education programs, students, and the State's economy. AHRIC has concerns about SB 289, it seems to reverse the consolidation efforts of Congress over the last five years. Four major pieces of legislation in 1995 consolidated three councils into AHRIC that included the Governor's council on vocational education. In 1998, SB 334 was a reform bill of the system that created performance measures and accountability, and provided more authority for AHRIC for planning and reporting to the legislature. In 1999, HB 40 consolidated 17 federal state workforce investment programs and adult education programs, from three departments into one new department, the Alaska Department of Labor & Workforce Development. In 1998, Congress passed the Workforce Investment Act that goes into effect July 1, 2000 which consolidated 60 federal programs and established AHRIC as the State's workforce investment board. AHRIC believes some areas of SB 289 are duplicative, and will increase administrative effort. AHRIC has been effective bringing business and education closer together to work on career pathways and skilled training for students and adults. The job training programs are meeting their performance levels. AHRIC has been able to receive additional funds to help Alaska's rural youth, and develop regional skills consortiums for the State, so business and education work directly in providing industry standard training. There are no eligibility requirements for persons being trained and that is a concern for AHRIC. AHRIC is concerned if SB 289 passes it should be viewed as a demonstration program so AHRIC is assured that it is providing the results that AHRIC would like to see, and that it doesn't offset the actuarial condition of the unemployment trust. AHRIC believes the grant program and the State coordinated plan is a good idea and necessary at this time, but this can be accomplished without creating a duplicative board and a duplicative administrative and funding cycle. AHRIC has not had time to review the committee substitutes, but is raising concerns about shifting step funds into this program. CHAIRMAN MACKIE asked if Mr. Andrews had talked with Senator Torgerson about the committee substitute. MR. ANDREWS answered yes. They have discussed how to raise additional money for vocational education training that would help support the connection with post-secondary education, and the need for a coordinated plan. Where AHRIC differs from Senator Torgerson and Congress is in the need for a new board and some duplicative text. AHRIC's administration cannot support SB 289 as it exists. SENATOR KELLY asked if AHRIC's position and the administration's position are the same. MR. ANDREWS stated he was speaking for the administration. MS. BARBARA THOMPSON, Deputy Director of the Division of Teaching & Learning Support for the Department of Education & Early Development (DEED), referred to the fiscal note. What the DEED saw as a cost for establishing this new board would be included first for the Alaska Technical Vocational Education Program Fund. The Department of Labor & Workforce Development (DLWD) estimates what they would collect for this portion of SB 289. TAPE 00-11, SIDE B MS. THOMPSON explained the funds listed in the grant line on page 1 of the fiscal note. The other costs are related to the establishment and operation of the new board and ongoing activities, personal services for staffing of the board, a grant administrator, travel for the board, contractual relating to the ongoing cost of the board, and supplies for the board. The last page of the fiscal note discusses existing resources that are in DEED, that would fall under the preview of the new board. Those include federal grant funds, text prep grant funds, and non K-12 portions of the federal Carl Perkins Grant. The management fee assessed from the Alaska Vocational Technical Center (AVTeC) is currently a management assessment fee to AHRIC, and assume the fee would go to the new board. MR. DWIGHT PERKINS, Deputy Commissioner of the Department of Labor & Workforce Development (DLWD), stated the concerns that DLWD has are financial and technical in nature, with employment security and the Unemployment Insurance trust fund. CHAIRMAN MACKIE stated his concerns are dealing with the fiscal note of CSSB 289. Chairman Mackie stated the bill should be passed to the Finance committee so Senator Torgerson can work with Mr. Andrews and Ms. Thompson. MR. PERKINS stated DLWD will continue to cooperate with Senator Torgerson regarding the fiscal note, but Mr. Andrews' concern seems to be a philosophical concern. MS. RUTH DECAMPI, Program Manager for the Municipality of Anchorage Workforce Development Program, stated opposition for CSSB 289. The Workforce Development Program administers the step training program for people who are unemployed, and for half of the State's workforce in Anchorage. CSSB 289 defies the entire Workforce Investment Act, which is based on customer choice, and performance base. Institutions receive funding if people choose to go there. Ms. Decampi does not see a reason for AHRIC to exist if CSSB 289 passed. SENATOR KELLY moved CSSB 289 (L&C) with individual recommendations and accompanying fiscal notes. Without objection, the motion carried.