HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE March 4, 1998 8:05 a.m. MEMBERS PRESENT Representative Ivan Ivan, Chairman Representative Fred Dyson Representative Joe Ryan Representative Jerry Sanders Representative Albert Kookesh Representative Reggie Joule (via teleconference) MEMBERS ABSENT Representative Scott Ogan COMMITTEE CALENDAR * HOUSE BILL NO. 401 "An Act relating to contracts for the provision of state public assistance to certain recipients in the state; providing for regional public assistance plans and programs in the state; relating to grants for Alaska tribal family assistance programs; and providing for an effective date." - MOVED HB 401 OUT OF COMMITTEE * HOUSE BILL NO. 365 "An Act relating to municipal service areas and providing for voter approval of the formation, alteration, or abolishment of certain service areas." - BILL HEARING CANCELLED (* First public hearing) PREVIOUS ACTION BILL: HB 401 SHORT TITLE: STATE/REG'L/TRIBAL FAMILY ASS'T PROGRAMS SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR Jrn-Date Jrn-Page Action 2/12/98 2308 (H) READ THE FIRST TIME - REFERRAL(S) 2/12/98 2308 (H) C&RA, HES, FINANCE 2/12/98 2308 (H) ZERO FISCAL NOTE (DHSS) 2/12/98 2308 (H) GOVERNOR'S TRANSMITTAL LETTER 3/04/98 (H) CRA AT 8:00 AM CAPITOL 124 WITNESS REGISTER JAY LIVEY, Deputy Commissioner Department of Health and Social Services P.O. Box 110601 Juneau, Alaska 99811 Telephone: (907) 465-3030 POSITION STATEMENT: Presented HB 401 on behalf of the Governor. KRISTEN BOMENGEN, Assistant Attorney General Human Services Section Civil Division Department of Law P.O. Box 110300 Juneau, Alaska 99811-0300 Telephone: (907) 465-3600 POSITION STATEMENT: Answered questions pertaining to HB 401. BOB CHARLES, Vice President Operations Association of Village Council Presidents P.O. Box 219 Bethel, Alaska 99559 Telephone: (907) 543-3521 POSITION STATEMENT: Testified on HB 401. TERRY HOEFFERLE Chief of Operations Bristol Bay Native Association P.O. Box 310 Dillingham, Alaska 99576 Telephone: (907) 842-5257 POSITION STATEMENT: Testified on HB 401. DON SHIRCEL, Director Family Services Tanana Chiefs Conference P.O. Box 75014 Fairbanks, Alaska 99707 Telephone: (907) 452-8251 POSITION STATEMENT: Testified in support HB 401. ACTION NARRATIVE TAPE 98-13, SIDE A Number 0001 CHAIRMAN IVAN IVAN called the House Community and Regional Affairs Standing Committee meeting to order at 8:05 a.m. Members present at the call to order were Representatives Ivan, Dyson, Sanders and Kookesh. Representative Joule participated via teleconference. Representative Ryan arrived at 8:10 a.m. HB 401 - STATE/REG'L/TRIBAL FAMILY ASS'T PROGRAMS Number 0059 CHAIRMAN IVAN announced the committee would address HB 401, "An Act relating to contracts for the provision of state public assistance to certain recipients in the state; providing for regional public assistance plans and programs in the state; relating to grants for Alaska tribal family assistance programs; and providing for an effective date," sponsored by the Governor. Number 0111 JAY LIVEY, Deputy Commissioner, Department of Health and Social Services, came before the committee to explain HB 401. He informed the committee he would review the legal background of why the bill was introduced. He stated when federal welfare reform was passed by Congress last year, it established a process by which Alaska Native regional nonprofit corporations could, if they wished, apply to the federal government and receive authorization to administer welfare programs within their regions. He pointed out that as part of that process, the regional corporations would be able to receive from the federal government the equivalent amount of federal funds that the state spent on those tribal members during 1994. Essentially, what the bill did was it established a block grant by which federal money that the state was getting now would go to the regional Native corporations on behalf of welfare recipients in that region. Mr. Livey stated the problem with this process is that the federal law only established a way for the regional corporations to get the federal share of the welfare expenditure. That only makes up part of what is currently being spent within these regions. The other part of the money that is being spent out there comes from the state. Mr. Livey informed the committee members that HB 401 establishes a process by which state money can also get out to those regional corporations that are providing welfare programs, so that they can essentially have a complete program. Number 0278 MR. LIVEY said that after the passage of the federal welfare law, which allowed this process to occur, the state spent some time sitting with representatives of the regional nonprofit corporations. He said that during that process they discussed how this mechanism would occur and some of the principles under which they thought this process would be most useful. Mr. Livey said he would review those principles. First, most representatives of the state and the regional corporations want to promote self- sufficiency in rural Alaska. Everybody understands that welfare reform is going to be difficult in rural Alaska and he believes both the state and regional nonprofit corporations recognize that it has to move forward there as well as other parts of the state. Mr. Lively said secondly, they also wanted to promote flexibility in the self-sufficiency strategy. He said they recognize that regional corporations have a unique view of the economies and the skills of the individuals in their areas and that they can do a better job than the state of designing programs that will work specifically for those areas. Third, they wanted to assure efficient management of programs that both the state and the regional nonprofit corporations administer. Fourth, they wanted to discourage disparity in benefit levels for similarly situated Alaskans. He said they didn't want two Alaskans living next to each other receiving significantly different benefits and services. Mr. Livey stated that finally they needed to address some of the issues related to the state of Alaska delegating authority to regional nonprofit corporations. Number 0421 MR. LIVEY said he would talk about how the process of the bill works. He pointed out that the committee should have a document with a flow chart which addresses the process of how the bill actually functions. Mr. Lively stated if HB 401 were to become law, it would set up a process by which a regional nonprofit corporation would send to the department their proposed tribal assistance plan. The department would then review that plan based on several standards. The first standard has to do with the services that the regional nonprofit corporation proposes to provide. Mr. Livey pointed out that HB 401 gives the commissioner of the Department of Health and Social Services the authority to determine if the regional nonprofit corporation service area provides a reasonable pattern of service delivery. He said, "We wanted to make sure that we were going to be able to meld the state program and the regional [nonprofit] corporations together reasonably for efficiency of administration." Mr. Livey referred to the tribal plan and said if it is going to be eligible to receive state money it must contain five service provisions which are also found in the state welfare law. Those provisions are that there must be a dependent child in the household in order for the household to receive public assistance money. Secondly, the payment amount the regional nonprofit corporation would provide cannot exceed the state amount. Third, a minor parent must live with an appropriate adult supervised setting or with their parents. Fourth, all able bodied participants must work. He noted it doesn't have to be cash work but it has to be work in some way of contributing back to the community. Lastly, the participants must comply with child support. Mr. Livey stated that once the tribal assistance plan meets those two conditions, then that plan is eligible to receive, through a grant, state funds for the provisions of public assistance services. He pointed out that the state grants fill out the tribal assistance program. With the tribal assistance program, the regional nonprofit corporation is available to receive the federal money directly which would give them the rest of the money they need to provide the program and make it whole. Number 0636 MR. LIVEY stated, "There is one more issue in this bill that we should mention and that is that it may be that in areas within the regional [nonprofit] corporation that there will be non-Natives who will be eligible to receive public assistance services. When we talked to the regional [nonprofit] corporations about this issue, we determined that the best thing to do would be to have the regional [nonprofit] corporation provide the services to those non- tribal members. There are generally a few members, they may be scattered throughout the region. It didn't make sense for the department and for the state to have to maintain a program just to serve those few individuals." Mr. Livey stated that in that case they would contract with the regional nonprofit corporation and send them both the federal and state share of money required to serve those individuals. He noted those individuals would be served with the tribal regional nonprofit corporation benefit package. That seemed to make sense in terms of two of their principles, one of which was that they wanted to have individuals living in the same economic situation - same region - same community, to receive the same benefit package. Secondly, they wanted to have an efficient administrative process. Number 0728 MR. LIVEY pointed out that the department sees three major benefits if HB 401 were to pass. First, the department believes that welfare reform will be more successful because welfare services will be designed specifically for conditions within the region. Secondly, it will be to the benefit of the state to partner with regional nonprofit corporations, many of whom already have fairly sophisticated employment training systems established. Mr. Livey referred to the third benefit and said we have regional nonprofit corporations as local providers who are willing to step forward and take on some of the responsibilities from the state for welfare reform services. Number 0797 REPRESENTATIVE JERRY SANDERS asked if there is a provision in the legislation that would reduce payments over time. He asked how long people can draw welfare. MR. LIVEY responded that in most parts of the state, people can be on assistance for 60 months. He noted there is nothing in the current state welfare reform law which essentially phases out the benefit. However, if a regional nonprofit corporation wished to structure their program to do that, under HB 401 they would have the freedom to be able to do that. He stated that there is currently nothing in state law or in the state's welfare program that requires that kind of a phase-out. Number 0862 REPRESENTATIVE SANDERS stated that he believes that you have to have a phase-out. It will be no better to drop them off five years from now than it would be to drop them off today. Representative Sanders explained that a concern he has is they must have a dependent child in the household. He stated it is his firm belief that this will lead to more households with dependent children. If the choice is to either get off the welfare system or get a dependent child in the household, he believes a lot of people are going to make that conscious choice and get some dependent children within a year. Representative Sanders referred to the statement that the participants must comply with child support and asked if the money couldn't be taken out like it is done with the permanent fund dividend. He said usually it is a young man and you can't depend on giving a young man the money and depend on him to give it to the mother and child. Number 0989 MR. LIVEY stated that provision actually applies to the mother who would be the recipient of child support. It is a requirement that as a provision of receiving the public assistance benefit that she must comply with child support in terms of trying to locate and identifying the father. The requirement is really on the mother and not the individual who is the obligor who is paying the child support. Number 1050 REPRESENTATIVE JOE RYAN referred to page 8, line 20, and said it talks about confidentiality. He said, "I've gone back to 071, which referred me to 020, which referred me to 030." He said if we're going to give out public money, he would like to know what, why and how the confidentiality works. Representative Ryan stated public money has to be accounted for and if people have confidentiality under the law, it is will make things difficult for accounting purposes. Number 1089 MR. LIVEY stated the provision is in the bill to assure that if the state provides a contract to the regional nonprofit corporations and that contract would be to provide public assistance benefits to non-Natives living in the corporation region, then the state would essentially be turning those cases over to the regional nonprofit corporation to provide service. The provision is designed to assure that the regional nonprofit corporations understand that they are also under confidentially provisions in terms of releasing information about those cases. He stated, "It is meant as a protection for the confidentiality of those cases that the regional corporations are now serving." REPRESENTATIVE RYAN asked Mr. Livey to explain current confidentialities we have and for what purpose. Number 1173 KRISTEN BOMENGEN, Assistant Attorney General, Human Services Section, Civil Division, Department of Law, came before the committee. She referred to Representative Ryan's question regarding confidentiality and said currently, the records that are contained in public assistance files may involve any number of records that are entitled to a kind of privacy consideration. Ms. Bomengen informed the committee members that under the previous welfare laws, the federal requirements are that all the information remain confidential. Some of the information had to do with other income sources, family concerns, medical records, et cetera. Those are all considered to be taken out of the public record's arena and placed into a confidential arena so that people are not sacrificing any privacy matters for the purpose of receiving the assistance they seek. REPRESENTATIVE RYAN questioned who has access to this information. MS. BOMENGEN informed the committee that the access is limited and it's primarily to service providers. As this program has converted more to work orientation, there are waivers of the kind of information that are appropriate to work placement. The access to the information is kept within the agency. She pointed out that there are some waivers for child support enforcement purposes and certain limited purposes in order for the state to conduct its business that's directly concerned with the operation of the program. REPRESENTATIVE RYAN asked how he would access information such as the number of people receiving Aid to Families with Dependent Children (AFDC). MR. LIVEY responded that the bill has a provision that allows the department, through the grant mechanism, to define what information the state wants to receive from the regional nonprofit corporations regarding the number of people served and what services individuals are receiving. In addition, the regional nonprofit corporations will have reporting requirements to the federal government regarding what the result is of the spending federal money. He noted the department has access to all those reports. Mr. Livey stated that the provision is primarily to keep information about individual cases out of the hands of people who don't have a right to know unless they're administering the program and they have some reason to have that information. MS. BOMENGEN referred to the confidentiality provision and said the most recent federal law does require that records be kept confidential. It doesn't prescribe every manner in which those records must be kept confidential. She said the concern addressed there is that any entity that's operating federal programs in the state be respecting those confidentiality rules as they exchange information in order to ascertain whether anyone is receiving duplicate aid or the like. Ms. Bomengen noted the fiscal accountability concerns are addressed in the top portion of page 7. It requires the agency to turn over the same records that they would be submitting to the federal government and also to submit to the auditing of their financial records. Number 1426 REPRESENTATIVE RYAN said in the past, the Administration has indicated that they weren't interested in privatization and yet, they are coming forth with a bill that talks about large privatization. He questioned why there is this shift and asked if the Administration will be more agreeable on privatizing other aspects of government. MR. LIVEY indicated it is hard for him to speak for the rest of the Administration but in the area of public assistance, they have begun to privatize a lot of the features of welfare reform. He said, "When the program of welfare reform changed from simply sending a check out to people - and I don't want to simplify too much because we were trying to put people to work prior to a couple of years ago, but a couple of years ago, when welfare reform passed it really did change our focus on getting people to work. And since that time, virtually all of the welfare to work money that we've received from the legislature, for example, has gone out to private contractors who are helping us to put people to work. I think we see this as an extension of that and I think philosophically we don't have, in terms of public assistance, we don't have any problem in trying to find folks out there who are willing to help us do a better job." Number 1555 CHAIRMAN IVAN said that the committee has conducted several hearings on how to strengthen the state/village tribal relationships. He said he believes the bill falls somewhat in line with that effort of strengthening those relationships. Chairman Ivan stated, "I believe giving the responsibility to the area government, I call the regional nonprofits, is just that. They provide service to village communities, individual folks, and they have a history of going back quite a number of years since the Indian self determination education assistance law that permitted contacting for the Indian Health Services. And I think they do a better job and they're established now with all the contracting requirements placed by the Federal Government Accounting Administration and they have a organization established and they're ready to take on more responsibility. Since they're on the ground in that area, they're familiar with the individual families or those people that do need assistance." Number 1679 REPRESENTATIVE REGGIE JOULE said there is a zero fiscal note. He asked wether or not there would be any savings by implementation of this. MR. LIVEY referred to the five requirements of the state program that must be met and said those requirements are currently in the state's welfare reform law. This is meant to require some level of conformance between the regional nonprofit corporation benefit and service plan and a state service plan. Mr. Livey referred to the phase out of benefits and said there was another provision of the federal law that was passed. In some parts of rural Alaska where there are high unemployment rates of 50 percent or higher, the 60- month time limit does not apply. There will be some areas of rural Alaska where recipients will not be facing that 60-month time limit. He noted that was a provision of the federal law that was passed last fall. REPRESENTATIVE JOULE referred to the zero fiscal note and said he was wondering if the state would realize any savings by entering into contracts with the regional nonprofits. MR. LIVEY informed the committee that there is a zero fiscal note because it primarily authorizes legislation. He said as the department does their annual budget, there will be a few changes as a result of regional nonprofit corporations deciding to do this. Mr. Livey said in the long term, what the department would expect to see is probably not significant reductions on the administrative side, but they hope to see that the regional nonprofit corporations will do a better job of putting individuals to work and they hope to see some reduction on the benefits paid out to individuals. REPRESENTATIVE ALBERT KOOKESH referred to Public Law 104-193, which was adopted August 22, 1996, and said under Section 412, "Direct Funding Administration By Indian Tribes," it is federal legislation which allows the tribes to do this with or without the state's blessing. Secondly, under subsection (b) of Section 419 under "Special Rules for Indian Tribes in Alaska," Metlakatla plus all of the nonprofit corporations are the corporations which are allowed to have direct funding from the federal government for these programs. Representative Kookesh said his interpretation of the bill and the way it would work is that those tribes could apply for direct funding for this welfare money to go directly to the nonprofits. If they want the state money that is being spent in those same areas, then they go through the process of putting their plan together and having it approved by the state. If the state approves a plan, then the same money that would be used by the state for those same recipients would go to the nonprofits and they would administer a joint program with state and federal money. He said by accepting the fact that there are those five provisions that they must include in their plan that then are state directed requirements. He said, "My interpretation of that is essentially that except there are two things that I think that I want to follow up on what Representative Ivan made reference to. One, we're either going to have one state or two states here. The step toward working together as a Native and non-Native community starts here. We have a welfare program that the nonprofits, which have been in place by the way for well over 20 years - some of them, can administer very ably. If we don't have that program in place, they would administer their own program, the state would administer their own program. We'd have two administrations trying to do the same job. And the fact that the nonprofits have essentially said, 'We would support this, we would work with the state and we would even take care of non-Natives living in our area,' is a step in the right direction. I think it makes a lot of sense for the state to do that. If the state doesn't adopt this bill, and the majority can do what it will here, the nonprofits will survive anyway. They would get that direct federal funding from the federal government and they would take care of their own welfare program. The state is absolutely correct here that because there is also an exception to the 60-month rule, they can survive a lot longer than the state would be able survive under this program. I believe that every one of the nonprofits in the state, while may be a little bit reluctant some of them, are very willing to cooperate with the state in this kind of joint effort even to the fact of having adopted those state requirements and having an oversight by the state into the program." REPRESENTATIVE KOOKESH said while there are two programs being administered, somebody in Anchorage who is being administered under the Native program could receive more money per month than a person who is administered under the state program. If they are all under one program and if the state requirement is adopted, then everybody would get the same benefit package. He said he would like to emphasize that whether the bill becomes law or not, those nonprofit corporations will be administrating programs with federal dollars. REPRESENTATIVE RYAN said somewhere down the line there is a cost to the Administration if the bill becomes law. He asked how much of an administrative fee will the nonprofit corporations charge to set up the program. He asked if the money will come from the state's portion or the federal portion. Number 2131 MR. LIVEY stated that there will be an administrative cost to the regional corporations for setting up the services. The money will have to be taken either from the money they receive from the federal government, which is a block grant essentially based on a fixed amount of expenditure in 1994, or it will have to come from whatever the legislative appropriation is for this purpose. The amount of money appropriated to the regional nonprofit corporations to provide the service is somewhat fixed. He explained it is fixed on the federal side because of the way the federal law is written. It is fixed on the state side because it's based on an appropriation made by the legislature for this purpose. Mr. Livey informed the committee that out of those two streams of money that are going to the regional nonprofit corporations, the corporations are going to have to decide how they want to organize their administration. Any money it spends on administration is money they will not be able to spend on services and benefits. He stated that is an operational administrative decision that each regional nonprofit corporation will have to make. REPRESENTATIVE RYAN said if it spends general fund money, he would think it should be reflected in the fiscal note. At the same time, Mr. Livey has indicated there won't be a reduction in state administrative costs and asked where the savings are. MR. LIVEY said he didn't mean to imply that there wouldn't be any reductions in administrative costs on behalf of the state. He said he thinks there will be some, but he stated he isn't sure if it will be a one for one reduction. He said there are some administrative costs that occur within the Department of Health and Social Services' budget that are fixed. For example, if Tanana Chiefs were to take on the program, the department still has to maintain their computer system for all the remaining beneficiaries. He said the department wouldn't be able to cut administrative costs for computers because that is a essentially a fixed cost. There would be some reductions in other areas as the department wouldn't have to have staff in as many rural areas as they currently do. Mr. Livey said he believes a big benefit will be that there will be a better result on the number of people who are on the program and how fast people get off the program, et cetera. MR. LIVEY referred to those costs not being reflected in the fiscal note and said what the legislation really does is provide a mechanism for the regional nonprofit corporations, if they choose, to make a proposal to administer the program. He explained that the legislature has control of the costs through the annual budget process because within the department's public assistance budget request unit, there would be an allocation for tribal assistance plans. The legislature would have some control over how much money gets appropriated each year to these plans. Mr. Livey informed the committee that the department doesn't know how many regional nonprofit corporations might be coming in and what year they might start operations. The legislation is just authorizing legislation. REPRESENTATIVE RYAN said he would appreciate it if the department could present a scenario that would give some idea of what the anticipated costs will be given a certain set of circumstances such as if five or ten corporations participate. He noted that the communities may actually lose because a state employee may put more money into a community than a regional nonprofit corporation employee would. Number 2316 REPRESENTATIVE KOOKESH said he would agree with Representative Ryan in that he would like to see what the benefits and the costs will be. He said the nonprofits may have some idea what their administrative costs would be if they received "X" dollars from the state and what impact that would have as compared to what is left over for services. He indicated the legislature can't really make an informed decision unless that kind of information is provided. Number 2339 REPRESENTATIVE JOULE said the bill has other committees of referral. It will go to the Health and Social Services Committee and the Finance Committee. He said he doesn't believe the committee needs to hold onto the bill. Representative Joule stated that while the regional tribal organizations may not utilize the authorization that the bill provides, they are not in opposition to having it available to them. He said he doesn't know of any nonprofit corporations that are opposed to the legislation. He asked Mr. Livey if he knows of any. MR. LIVEY responded that to his knowledge, he doesn't know of any. He stated that the department has been in communication with the regional nonprofit corporations and he believes they are all supportive of the legislation. Number 2431 BOB CHARLES, Vice President, Operations, Association of Village Council Presidents (AVCP), testified via teleconference from Bethel. He informed the committee members that the AVCP was established in 1964, and it was incorporated in 1978. Throughout most of AVCP's history, they have been contractors of the Bureau of Indian Affairs (BIA) and other federal agencies. He said the AVCP provides social services, education and training programs and was given the responsibility to provide these services to roughly 20,000 people living in the Yukon-Kuskokwim area. TAPE 98-13, SIDE B Number 0001 MR. CHARLES continued, "permanent basis and about - around 250 temporary and part time workers that work throughout the region in villages." He stated that they have established a close working relationship with all the local governments and their communities. MR. CHARLES explained that Alaska regional nonprofits, like AVCP, generally provides services to Alaska Natives in areas of education, employment services and vocational training. He noted ACVP runs a head start program. He said they have a number of realty specialists that work with Native allotment land owners. Mr. Charles explained they provide social services that include services like general assistance which is very similar to what is provided in the bill. With their general assistance programs, they have a lot of the same requirements and standards which are placed on them that are provided by the state. He said they provide Indian Child Welfare Act services which includes child and family resource specialists that work with children and families in each of the villages. Through a federal grant, they provide energy assistance. There is also a special elderly services program. Mr. Charles said they also run a receiving home service program for children who are in the foster care system. There is a credit and finance program that works with people who are interested in getting into business on their own. He continued to inform the committee of several programs the AVCP administers. He stated they have a work force development contract which employees roughly 46 people, one in each of the villages that takes clients that are referred to them by the Division of Public Assistance. So far, they have been able to triple the number of people that the Division of Public Assistance set as a goal for the AVCP in order to meet their work participation requirements that are set under the Alaska Temporary Assistance Program (ATAP). MR. CHARLES informed the committee members that AVCP, as well as many of the Alaska Native regional nonprofits, have been involved with welfare reform issues since they began a number of years ago. They have participated in meetings with state and federal agencies, legislators and congressional members to put forward their perspectives and opinions to make welfare reform work. He said the AVCP believes that welfare reform really needs to be brought down to the village level where all the local people who are involved in welfare are involved directly in how they accomplish the purposes of welfare reform. MR. CHARLES said, "The way we feel about this is that we take this as if it is taking the next step in this partnership with the state to engage our local resources and infrastructure to implement welfare reform. We don't feel that the state has the capability or capacity to do the job it's required to do, under ATAP, on its own. And we feel we're hand in hand, dependent upon each other's resources to be able to accomplish the work that's set before us. And that's basically the way we see it - working hand in hand with the state. We agree with the concept of what's laid out in the bill to bring welfare reform out to the villages. What's basically set out in the law now requires that we follow a certain set of guidelines and requirements and it's very tight for us. For Alaska, we have to follow guidelines that are close to the state and in our region, we're very familiar with the process, we've worked for the state for a number of years." Number 0356 REPRESENTATIVE SANDERS referred to Mr. Charles' discussion regarding tripling the amount of work force and asked what that means. MR. CHARLES responded, "When we started out this with the state - the work force development project, they were hoping that we would just set a goal of around 318 or 20 right around there, of two- parent family cases - to put them in work activities or handle that many cases in our villages. Since then, we've actually doubled that up to right around 600 or so cases. And we felt that we've over met the goal of trying to place people in work activities to meet their work participation rates." CHAIRMAN IVAN said he would like the committee members to appreciate how the organizations are set up. He explained the board of directors consists of village tribal chiefs and council presidents. In a lot of cases, some are elders from communities that have a very conservative philosophy and they encourage their younger generation to be more self-sufficient. Chair Ivan stated that he believes some of the policies developed by the regional nonprofits have the same goal as we do down here. Number 0465 TERRY HOEFFERLE, Chief of Operations, Bristol Bay Native Association (BBNA), testified via teleconference from Dillingham. He informed the committee members that the Bristol Bay Native Association is an association of 30 communities in Bristol Bay. It was originally organized in 1966 to fight for Alaska Native land claims. Once the land claims was passed, the association incorporated in 1972 as a nonprofit corporation under state law. Many of their operations in the early years were (indisc.) or war on poverty programs and the funding sources were such that the programs were offered to Native and non-Native people. He said the association has over 25 years of experience in providing services to both the Native community and the non-Native community. Mr. Hoefferle informed the committee members that a substantial portion of their funding is tied to Native American programs. Because of those funding sources, those programs are offered only to the members of the association, the Native residents of Bristol Bay. MR. HOEFFERLE said he would speak about the capacity of the Bristol Bay Native Association and their sister organizations throughout the state in being able to handle programs like this. He said some people may have been astonished last fall to hear the Attorney General talk about the fact that the state has very little presence in rural areas. That is not only true in terms of law enforcement but it's also particularly true in terms of the delivery of social services. The state's absence in rural areas in the provision of social services is that the vacuum has been filled by regional Native nonprofit organizations such as BBNA. Mr. Hoefferle explained that the BBNA currently operates 42 separate programs and they are required to report independently on each of those programs in terms of accomplishing program objectives and in terms of fiscal accountability and compliance. The association currently has a budget of $16.3 million. Of that budget, about $1.7 million is devoted to employment training work force development type programs. In 1992 - 1993, the board of directors of the BBNA saw some of the handwriting on the wall with respect to problems in the fishing industry and directed the association to get into social and safety-net type programs. At that point, they took on a social services program that provided general assistance to needy recipients and redoubled their efforts to provide such programs like energy assistance, et cetera. Mr. Hoefferle pointed out that about four years ago, they incorporated employment and training programs, general assistance programs and child care programs into a single unit called "workforce development." This was done under the aegis of a federal law, Public Law 102-477, which enabled the BIA programs, Department of Education programs and Department of Labor programs to be operated in such a way that the programs could be combined. They could waive certain kinds of requirements with respect to reporting, record keeping and administration. He stated that by combining the operation of the programs, the association has managed to reduce the administrative costs by 30 percent. The 30 percent reduction in the administration of these programs went directly into increasing services to their members. Mr. Hoefferle informed the committee members that currently the BBNA employs 230 village staff and about 63 central office staff. The village staff are a particular asset of the association. They are not only a benefit to the communities that they serve but, potentially, are a benefit to the state of Alaska in the implementation of the legislation before the committee today. Mr. Hoefferle said there is a delivery system currently in place in the 30 villages in Bristol Bay. MR. HOEFFERLE said in terms of welfare reform, the BBNA and their sister organizations around the state were several steps ahead of Congress and the Alaska State Legislature in terms of having "workfare" programs attached to general assistance. It was called a tribal work experience program at that time. That would require people receiving general assistance to work in exchange for their assistance checks. Mr. Hoefferle said they continue with this focus on work and getting people employed to this day. He said he believes their commitment to that is unquestionable. MR. HOEFFERLE referred to the way the state's welfare reform or ATAP program is operating today and said there have been statements in the newspapers that the welfare rolls are decreasing. In Anchorage, Fairbanks, Sitka, Juneau and in the areas where there are many related kinds of programs, the state provides a means for people to get on welfare and a means for them to get off of welfare. In rural Alaska, with the exception of the "ABCP region" which is a pilot program for the Department of Health and Social Services, the bulk of the ATAP work is being handled long distance by telephone from Anchorage. While it might have been possible to do it back in the days when welfare was simply cutting a check to people that qualified, today, welfare reform type programs mean providing assistance for people - providing training to get them off welfare and on to the job. He explained that currently, in rural Alaska, the state provides a way of people getting on welfare with no effective means of getting them off of welfare. That is where he believes this particular piece of legislation holds the most promise. MR. HOEFFERLE referred to fiscal and program accountability and said in the nine years he has been with the BBNA they have not had a single audit exception - that's either a programmatic or fiscal exception. He said he doesn't believe they are unusual in that regard. Their sister organizations throughout the state are equally astute in being able to meet all the fiscal and programmatic requirements that the state and federal governments impose on them as a condition for receiving public funds. Mr. Hoefferle said he would answer any questions the committee may have. Number 0941 DON SHIRCEL, Director, Family Services, Tanana Chiefs Conference (TCC), testified via teleconference from Fairbanks. He informed the committee members he has been in his position as director for the past 14 years. Mr. Shircel said he holds a Master of Science degree in Behavioral Disabilities and he administers an annual budget of over $6 million of the $50 million of the state and federal health and social service programs provided by TCC. MR. SHIRCEL read his statement into the record: "As a social service professional and program planner, I strongly support HB 401. In a state, especially of our size, it makes a lot of sense to regionally design and administer temporary assistance programming. HB 401 is consistent with the same rationale from which state and federal welfare reform emerged. Programs closest to the people are more responsive, relevant, effective and efficient in large centrally administered one size fits all program, planned and administered outside the community. "The majority of communities in the state, Alaska's rural communities, through their regional nonprofit corporations have been designing programs to better fit the needs of their families. You've heard about some of those from the previous presenters. Many of them have also been developing local and regional infrastructures that now rival the state's capacity to provide a comparable level of local service delivery. For communities in the Interior this is and has been the case for quite some time. "Since 1993, member communities of the Tanana Chiefs Conference initiated and have been jointly implementing over $1.3 million of 'workfare' assistance programming under the BIA welfare assistance grant program. Over the course of the past three years, the Tanana Chiefs Conference has conducted regional, sub-regional and village community meetings and teleconferences regarding the development and implementation of federal welfare reform legislation and programming. "As part of an Interior regional TANF (Temporary Assistance to Needy Families) program planning process in December of 1996, TCC conducted a regionwide survey of its member communities to determine their preferences in program design. In March of 1997, we developed and circulated, for discussion, a draft regional TANF program concept paper based on the consensus elements of the survey. We solicited and received comments on every program element at our annual convention and board of directors meeting and held a special board of directors meeting in June of 1997, to establish consensus on all the key program design elements. Additional discussion and input from Interior communities was initiated through separate sub-regional board meeting throughout the fall of 1997, and a draft regional TANF plan was developed and distributed for public review by every community in the service area during three separate teleconferences held to solicit additional comments on the plan. "In February of this year, just a few weeks ago, a final draft of our plan was developed which incorporated the comments from our communities review process. Our executive board of directors of Tanana Chiefs have reviewed and approved the TCC regional TANF plan. And from these formal discussions and decision processes along with our region public awareness efforts, we've been able to work along with other regional Native nonprofits, the state of Alaska Division of Public Assistance and the deputy director of the Department of Health and Social Services to put together a plan that we believe gets a bigger bang for the state and federal buck and our current programming. "In the truest sense of the word, the TCC's plan is programming developed by the communities themselves. The deliberative actions that have been taken to reach consensus on all aspects regarding our regional plan, we believe, will assure maximum and ongoing collaboration between local and regional partners of the project and will create a collective ownership in investments and commitment by all the parties regarding the goals of the plan itself. The TCC regional plan is based on and incorporates small community based service delivery design. It incorporates an infrastructure that includes over 40 existing community-based offices and assigned staff located on one-stop centers in each of the communities of the service areas. These shared staff and facilities are funded through the combined resources of multiple federal programs to minimize administrative costs and maximize the level of collaboration with other support services needed by families seeking to enter the labor market. The small community- based service centers, which we've designed into our program, are locally accessible, culturally appropriate, single points of entry for families needing assistance and also the single points of contact for a broad range of regional service providers and employers seeking to get information about their services and employment opportunities of potential clients. The small size of each village one-stop center allows for personal attention, individualized planning and services tailored to meet the needs of each family, as well as accurate, timely and ongoing monitoring of each client's progress. The TCC regional plan incorporates a service delivery infrastructure in which people are working with people, not paper. They know each other and regularly interact as members of the same community and work together toward a common goal to move on to work and to be more self-sufficient in providing for the needs of their family. "As I said, we believe that the TCC plan - our regional plan which was developed by the communities themselves gets a bigger bang for the state - out of the state and federal bucks than the current Alaska temporary assistance to needy families program does. While many of the elements of our program plan are identical to those of the state to assure standards of fairness to all Alaskan citizens, many of the key elements differ as a reflection of the strong attitudes and local values of the region itself. The TCC regional plan incorporates the same resources and exemptions, the same definitions for 'earned' and 'unearned' income, the same standards of need and eligibility that are used by the state, same level of benefits for children, pregnant women and disabled adults, same 60- month time limit, but there are some major differences. The creation of the one-stop centers in every community within the region who will assist individuals in getting off of welfare is one of the key elements. Another key element that differs from the state is in regard to the number of cases that are required to participate in work activities. In the state's current plan, 30 percent of the total case load is required to engage in work activities. In the TCC regional plan, on the advisement of local communities throughout the region, 60 percent, double the number of cases, are required to engage in work activities. In the state plan, individual cases are required to enter those work activities within 24 months - two years after they apply for assistance. In the TCC plan, individuals are required to get to work and to engage in the same work activities within two months, not two years. The TCC regional plan requires that all individual cases be screened for domestic violence and alcohol and substance abuse. They require all parents who receive assistance to attend parent-teacher conferences and become actively engaged in their children's education. They require participants to regularly engage in health checkups and health screenings available in their community and they impose strict sanctions for those individuals who don't. "Mr. Chairman and committee members, we ask that you seriously consider moving this bill out of committee and onto passage. We look forward to the positive and healthy collaboration with the state which this bill we believe would encourage. Thank you Mr. Chairman and committee members for your time and this opportunity to testify." Number 1409 REPRESENTATIVE RYAN asked why the program would be exempt from the state procurement code. He asked if there is only one entity in each area that may be eligible to do this. MR. LIVEY explained that the regional nonprofit corporations that are eligible to receive the grant are actually listed in the federal law. Number 1444 REPRESENTATIVE FRED DYSON explained that in the past, the state procurement code has been inordinately difficult to work with and is quite impractical for people in the field who have to do things. He said this Administration was well on its way to revising that. REPRESENTATIVE KOOKESH said he has heard members of the legislature say that we need to work with tribes in rural communities within the parameter of the Alaska Constitution and the bill makes good sense and it is a positive step. He said the organizations aren't fly-by-night organizations and he believes that they have done a very good job for the people in the Bush area. He noted that the committee should remember that the state's absence in the Bush, in rural Alaska, is the reason these organizations sprung up in the first place. They had to take the place of the state in its absence in rural Alaska. The tribes are looking for a handout, they are here with their hand out offering to help. They want a partnership with the state because it makes good sense and he hopes the committee members recognize that. Number 1586 CHAIRMAN IVAN said the hearing has been educational. He said as far as he is concerned the dollar that goes out, he believes, has more bang for the buck because it's not only social services that they provide, but counseling, education for children, et cetera. Chair Ivan said he believes the bill will further the effort to work together with the communities. He noted the bill also has a Health, Education and Social Services Committee referral along with Finance. REPRESENTATIVE DYSON said he appreciates the bill for several reasons. He said he concurs that there is a lack of state presence and some antipathy in villages he has visited. He said his own political philosophy is to decentralize everything and get decision-making and accountability as close as possible to where the work is and HB 401 does that. Representative Dyson said he doesn't think that the money and efforts that might come from this will be done perfectly, but they certainly aren't being done perfectly by the state now. He believes that the people in the rural areas of Alaska will ultimately demand excellence out of the administrators of these things, will hold some accountability and it will work. He said his own estimation is that the Department of Community and Regional Affairs has been skating close to the edge on issues in their efforts to work with local and regional nonprofits. He said he supports the bill and commends those who have brought it forward. Number 1811 REPRESENTATIVE DYSON made a motion to move HB 401 out of committee with individual recommendations. CHAIRMAN IVAN asked if there was an objection to moving the bill out of committee. REPRESENTATIVE RYAN asked, "Attach a zero fiscal note or are you going to wait for the department to come back?" CHAIRMAN IVAN responded with a zero fiscal note. REPRESENTATIVE DYSON interjected, "With the present fiscal note anticipating that may change before it gets to Finance." CHAIRMAN IVAN suggested that Mr. Livey provide information to Representative Kookesh and Representative Ryan regarding the fiscal concerns that were brought up. He asked if there was an objection to moving HB 401. There being none, HB 401 moved out of the House Community and Regional Affairs Standing Committee. ADJOURNMENT CHAIRMAN IVAN adjourned the House Community and Regional Affairs Standing Committee meeting at 9:32 p.m.