SB 215-REVIEW & REPORTING OF FED. RECEIPTS; LB&A  4:02:49 PM VICE CHAIR REINBOLD announced the consideration of SENATE BILL NO. 215 "An Act relating to the Legislative Budget and Audit Committee; requiring state departments, agencies, municipalities, school districts, Native corporations, the University of Alaska, and other entities that receive state funds to report on federal receipts; and relating to the increase of an appropriation item based on additional federal or program receipts." VICE CHAIR REINBOLD, speaking as sponsor, presented SB 215 paraphrasing the sponsor statement that read as follows: [Original punctuation provided.] SB 215 also known as the "Federal Receipts Fiscal Accountability Act." The Legislative Budget and Audit Committee shall annually review a report and recommend to the legislature whether to make, reduce, or repeal any appropriations based on the report. Federal Receipts reporting by agencies creates transparency in Federal Funds received that the legislature did not appropriate. Agencies must report program plans, should there be a reduction of federal funds. SB 215 creates transparency in the budget process so the legislature can fulfill constitutional duties. 4:05:53 PM KELLI TOTH, Staff, Senator Lora Reinbold, Alaska State Legislature, Juneau, Alaska, presented the sectional analysis for SB 215 that read as follows: [Original punctuation provided.] Section One: Adds a new section, short title: This act may be known as the Federal Receipts Fiscal Accountability Act. Section Two: AS 24.20.206 is amended to read: Sec. 24.30.206 Duties of the Legislative Budget and Audit Committee is amended to read: Review the annual report submitted by the Office of Management and Budget for the preceding fiscal year at the next regular meeting of the committee and recommend to the legislature whether to make, reduce, or repeal any appropriations based on the report. Section Three: AS 37.05 is amended adding a new section to article 2 to read: Sec. 37.05.215 Federal receipts reporting requirements, adds a new section to article 2 to read: Each municipality, state agency, school district, corporation organized under 43 USC 1602 et seq. as amended (Alaska Native Claims Settlement Act) and any other entity that receives state funds shall prepare and submit a report to the Office of Management and Budget on a form prescribed by the Office of Management and Budget that states the total amount of federal receipts received for the previous year, identifies all conditions or requirements that must be met to receive the federal receipts not appropriated by the legislature, states whether the federal receipts received for the previous state fiscal year that were not appropriated by the legislature require a match, supplement, or replacement upon acceptance of the receipts or when the receipts diminish, states the percentage of the entity's total budget that the federal receipts not appropriated the previous year describes an operating plan if there is a reduction of between five and 25 percent in the amount of federal receipts and, more than 25 percent in the amount of federal receipts received. On or before October 31 each year, a principal department of the state shall prepare and submit a report to the Office of Management and Budget on a form that describes a plan created for operating the department if there is a reduction of between 5 and 25 percent in the amount of federal receipts and more than 25 percent in the amount of federal receipts by the department. For a municipality that is a school district, separate reports for the municipality and school district shall be prepared and submitted. If the municipality applies for federal receipts on behalf of another entity, the municipality shall be responsible for preparing the report. If the municipality has less than 200 people, they may seek assistance from the Department of Commerce, Community and Economic Development. The Office of Management and Budget shall prepare and submit a compiled report to the Legislative Budget and Audit committee and identify municipalities and state agencies that did not submit the information required in this section. 4:09:34 PM Section 4: Sec. 37.07.080 (b) is amended to read: (3) should the Legislative Budget and Audit Committee recommend within the 45-day period that the state not initiate the additional activity, the governor shall again review the revised program and submit a newly revised program to the Legislative Budget and Audit Committee. (4) If the governor submits a newly revised program under (3) of this subsection, the legislative Budget and Audit Committee must recommend that the state initiate additional activity under the newly revised program, before commencement of expenditures. VICE CHAIR REINBOLD asked if there were questions. 4:10:39 PM SENATOR HOLLAND asked if any stakeholders had come out against this or previous iterations of the legislation and, if so, for what reasons. VICE CHAIR REINBOLD replied there has been objection from some stakeholders who don't show the source of all their funding. She noted that the Alaska Municipal League sent a letter opposing this concept several years ago. However, she believes it is imperative that the legislature, the body with the constitutional authority of appropriation, know the amounts of federal funding and where it is going so there is more transparency and thus a better budget process. SENATOR HOLLAND called the goal noble, and said his only concern was the potential personnel burden this might impose. VICE CHAIR REINBOLD advised that municipalities already have to account for federal funds so it would simply be a matter of reporting that information to the legislature. VICE CHAIR REINBOLD said the Legislative Budget and Audit Committee meets year round so the legislature could receive this information during the interim. 4:15:16 PM VICE CHAIR REINBOLD held SB 215 in committee for future consideration.