HB 262-BUILDING SAFETY ACCOUNT    AMY ERICKSON, staff to Representative Murkowski, read the following into the record: House Bill 262 is a fees-for-service measure establishing a building safety account to allow the Department of Labor to collect fees to support its mechanical inspections program and, more importantly, to catch up on a serious and sizeable backlog of elevator and boiler inspections. Currently the mechanical inspection section generates just over $1 million in general funds and is allotted about $695,000. HB 262 allows the department to collect fees and gives the authority to utilize the money generated for those fees. The fees range from $40 to about $105 depending on the type of vessel. Certificates of fitness for both electricians and plumbers also generate fees. The sizeable backlog of boiler and elevator inspections is a growing safety concern. The boiler backlog has reached about 6,000 and for elevators it's about 350. Instantly the Americans with Disabilities Act has caused the number of elevators to roughly double in the last eight years. Passage of HB 262 will give the mechanical inspections program the ability to restore three new inspectors to the program and to generate enough funds to eliminate the backlog of boilers and elevators in approximately two years. CHAIRMAN THERRIAULT verified that this wouldn't increase fees and would not impose new fees on classes of work that currently have not had fees. It's simply allocating the funds that are generated from that program. AMY ERICKSON agreed and said Remond Henderson could speak to the fiscal note. CHAIRMAN THERRIAULT noted that general fund dollars could be used now to restore three new inspectors to the program, but this provides a tracking mechanism. AMY ERICKSON agreed. REMOND HENDERSON, Director of Administrative Services for the Department of Labor and Workforce Development, said he was there to testify on the fiscal note and answer questions on it. He could answer program questions to a limited degree. The fiscal note requests that positions be established for two boiler inspectors and one elevator inspector. In FY 03 those three inspectors would cost $234,600 for a ten month period while their inspections would generate $242,800. In FY 04 they show the additional cost for extra two months of $41,400 and the additional two months of revenue generated of $49,700. FY 07 shows a reduction of one position because they expect to be caught up with the backlog of inspections by that time. The Fund Source section of the note shows a reduction of the general funds that are currently in the budget by $345,700, takes away the general program receipts, and replaces those with the new Building Safety Account fund that is established. CHAIRMAN THERRIAULT noted the building safety account has a fund source code. MR. HENDERSON said the 1172 code was just established. CHAIRMAN THERRIAULT asked if it was already established or whether it would be established by passage of the bill. MR. HENDERSON said it would be established by passage of HB 262. CHAIRMAN THERRIAULT asked whether this wouldn't be a general fund building safety account. MR. HENDERSON replied it is showing a reduction in general funds because that is where funds are currently budgeted and they don't currently have authority for a Building Safety Account. CHAIRMAN THERRIAULT wanted confirmation that the Building Safety Account would be a general fund account. MR. HENDERSON confirmed it would be a general fund account. CHAIRMAN THERRIAULT asked whether it would show up as general fund spending and take separate legislative action to put it into the non general fund column. MR. HENDERSON explained it wouldn't. In setting up the account it appears as a non-general fund account so it is technically off budget. CHAIRMAN THERRIAULT said Mr. Balash pointed out that section of the bill to him and he understands. SIDE B 4:25 p.m. CHAIRMAN THERRIAULT asked where the request for the three additional positions figured into the Governor's submitted budget. MR. HENDERSON replied those positions are requested in the operating budget as general fund increments. They aren't completely comfortable with that and prefer this method. With the passage of the bill, this is the proper vehicle to show that those positions would generate the additional proceeds to pay for themselves. He agreed that there are funds that are generated now, but they don't have the authority to spend those. SENATOR PHILLIPS asked Ms. Erickson who requested the bill. MS. ERICKSON responded it was the Department of Labor. SENATOR PHILLIPS then asked Mr. Henderson whether the department contacted the Governor to introduce the bill. MR. HENDERSON thought Representative Murkowski introduced the bill at the request of the Governor's Office and the Department of Labor. SENATOR PHILLIPS asked whether the Governor could do it himself. MR. HENDERSON said he probably could have. REBECCA NANCE GAMEZ, the Deputy Commissioner for the Department of Labor, said Commissioner Flanagan discussed this with the Governor, received his approval and then approached Representative Murkowski to introduce the legislation. CHAIRMAN THERRIAULT commented this is not an unusual course of action. There was no prepared committee substitute and no amendments were offered. SENATOR DAVIS made a motion to move HB 262 and attached fiscal note from committee with individual recommendations. There being no objection, HB 262 moved from committee.