HOUSE FINANCE COMMITTEE APRIL 26, 1993 8:33 A.M. TAPE HFC 93 - 126, Side 2, #000 - end. TAPE HFC 93 - 127, Side 1, #000 - #535. CALL TO ORDER Co-Chair Ron Larson called the meeting of the House Finance Committee to order at 8:30 A.M. PRESENT Co-Chair Larson Representative Brown Co-Chair MacLean Representative Foster Vice-Chair Hanley Representative Grussendorf Representative Hoffman Representative Martin Representative Navarre Representative Parnell Representative Therriault ALSO PRESENT Cheryl Frasca, Director, Division of Budget Review, Office of Management and Budget, Office of the Governor; Duane Guiley, Director, School Finance, Department of Education; Janet Clarke, Director, Administrative Services, Department of Health and Social Services; Representative Bettye Davis; Jay Hogan, Staff, House Finance Committee, Representative Ron Larson; Representative Jerry Mackie. SUMMARY INFORMATION SB 100 An Act making supplemental and special appropriations for the expenses of state government; making, amending, and repealing capital and operating appropriations; and providing for an effective date. HCS CS SB 100 (FIN) was reported out of Committee with a "do pass" recommendation. SENATE BILL 100 "An Act making supplemental and special appropriations for the expenses of state government; making, amending, and repealing capital and operating appropriations; and providing for an effective date." Co-Chair Larson listed items to be addressed in the work draft 8-GS1063\D, HCS CSSB 100 (FIN). His intention was to 1 close Section #52 - Department of Corrections. Co-Chair Larson MOVED Amendment #1. [Attachment #1]. The Amendment would provide the sum of $5,553,400 appropriated from the general fund to the Department of Corrections for the fiscal year ending 6/30/93. There being NO OBJECTION, it was so ordered. Co-Chair Larson provided the Committee with Amendment #2. [Attachment #2]. The sum of $1.150 million dollars appropriated from the general fund to the University of Alaska to pay the settlement agreement and legal costs associated with Dix. et al., v. University of Alaska. Representative Therriault MOVED Amendment #2, which would create a new section. There being NO OBJECTION, Amendment DUANE GUILEY, DIRECTOR, SCHOOL FINANCE, DEPARTMENT OF EDUCATION, introduced Amendment #3. [Attachment #3]. He stated that the Cooperative Agreement Grant Fund was established in legislation last year providing a grant fund program for school districts. The purpose of the legislation was to encourage cooperative agreements between school districts to provide more efficient and economical administrative and educational services. Over $1 million dollars were requested in the grant funds. Co-Chair Larson asked if any of the grants had been distributed. Mr. Guiley stated they had not. The legislation was passed last year although the fund was not capitalized when the legislation was passed. Representative Martin expressed disapproval of the legislation. Representative Hoffman MOVED Amendment #3. Co-Chair Larson OBJECTED. Representative Hoffman WITHDREW THE MOTION. Amendment #3 failed adoption. Co-Chair Larson explained the changes to Section #43. The subcommittee recommends increasing the sum to "$1,222,900" dollars. Representative Therriault MOVED TO RESCIND the original action in adopting the "$611,500". The original amount of funding would not adequately address the needed Dalton Highway repairs. There being NO OBJECTION, it was so ordered. Representative Therriault MOVED to add "$1,222,900" dollars to Section #43 for the Dalton Highway repairs and the aviation program for the current fiscal year. There being NO OBJECTION, it was so ordered. Co-Chair Larson discussed Section #72, the appropriation for the API facility. Representative Hanley MOVED a change to Page 12, Line 16, deleting "a" and changing "facility" to "facilities". He noted, the Mental Health Board requested 2 the change. JANET CLARKE, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, commented the Department does not oppose the amendment. The amendment would continue to allow the Department to bill a central facility and would also allow flexibility for replacing sections of API which need to be in regional or community settings. Representative Hanley provided the Committee background information regarding the facility. There currently is disagreement that Alaska needs a $60-$80 million dollar API. The Mental Health Board supports the legislation. Representative Brown recommended eliminating subsection (b), allowing funds to stay in the Mental Health account until a decision is reached. Ms. Clarke stated that the Department and the Mental Health Board have an agreement. One hundred and fourteen bed facility have been agreed upon. The current API facility will be down-sized to ninety beds. This is the smallest size facility which the Department can justify to provide the needed services. Representative Brown inquired how much of the appropriation would go to the proposed facility and how much to community facilities. Ms. Clarke replied that the community facilities envisioned would be in-patient hospital beds, although they have not yet been planned. Representative Hanley WITHDREW THE AMENDMENT. There being NO OBJECTION, it was withdrawn. Co-Chair MacLean MOVED Section #72. There being NO OBJECTION, it was so ordered. Co-Chair Larson provided the Committee with Amendment #4 which would appropriate $29.5 thousand dollars from the general fund to the Department of Health and Social Services, Alcohol and Drug Abuse Administration for line item allocations. [Attachment #4]. The amendment adds a new section. CHERYL FRASCA, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, explained the amendment would support the Governor's newly hired employee hired to address the alcohol and drug abuse problems in the State. The position was unexpected and not budgeted for in the new fiscal year. Representative Hanley asked if the position was funded in the budget next year. Ms. Clarke stated it was not. She said Lloyd Rupp, the ex-Commissioner of the Department of Corrections. Co-Chair MacLean MOVED the adoption of Amendment #4. Representative Martin OBJECTED. 3 A roll call was taken on the MOTION. IN FAVOR: Navarre, Brown, Foster, Hoffman, MacLean, Larson. OPPOSED: Martin, Parnell, Therriault, Grussendorf, Hanley. The MOTION PASSED, (6-5). Co-Chair Larson provided the Committee with Amendment #5. [Attachment #5]. The Alaska Science & Technology Foundation's Board of Directors fully supports the capital appropriation of $3 million dollars appropriated from the earnings of the endowment in the operating budget for FY 94. The request is for this amount to be transferred to BIDCO fund. Representative Martin suggested the adoption of the amendment would confuse the previously adopted intent language. Co-Chair Larson stated the language would supercede that previously adopted. Representative Brown MOVED Amendment #5. (Tape Change, HFC 93-127, Side 1). JAY HOGAN, STAFF, CONTRACT TO THE HOUSE FINANCE COMMITTEE, REPRESENTATIVE LARSON, stated the amendment would amend the bill previously passed out of Committee, substituting legislative intent for $3 million dollar appropriation in place of the current intent statement. Representative Martin OBJECTED to the amendment. A roll call was taken on the MOTION. IN FAVOR: Navarre, Parnell, Therriault, Brown, Foster, Grussendorf, Hanley, Larson, MacLean. OPPOSED: Martin. The MOTION PASSED, (10-1). Co-Chair Larson provided the Committee with Amendment #6. [Attachment #6]. Ms. Frasca explained the State of Alaska has concluded its negotiations with the Centralized Correspondence Study Education Association and the agreement has been ratified by the membership. The amendment requests the Legislature's approval of the contract's monetary terms. 4 Representative Brown MOVED Amendment #6. There being NO OBJECTION, it was adopted. Co-Chair Larson provided the Committee with Amendment #7 requested by Representative Bettye Davis. [Attachment #7]. The amendment would add $100 thousand dollars from the general fund to the Alaska School Counseling Program Grant Fund. Representative Brown MOVED Amendment #7. Representative Martin OBJECTED. REPRESENTATIVE BETTYE DAVIS spoke to the amendment. The funding would retrain counselors to work with problems children face in schools. The money would be spread throughout the State to train counselors to work with children in grades K-12. There has been no funding placed into the program for a number of years. Mr. Guiley disagreed and said funds are available for any purpose or scope of the grant awarded to the State. A roll call was taken on the MOTION. IN FAVOR: Parnell, Brown, Foster, Grussendorf, Hoffman, Navarre. OPPOSED: Therriault, Hanley, Martin, MacLean, Larson. The MOTION PASSED, (6-5). HCS CSSB 100 (FIN) was HELD in Committee for further discussion. REAPPROPRIATION LEGISLATION Co-Chair MacLean provided the Committee with Amendment #1 by Representative Mulder. [Attachment #8]. REPRESENTATIVE ELDON MULDER noted that Amendment #1 would reappropriate $50 million dollars back to Legislative Council for operations for the fiscal year ending 6/30/94. Co-Chair MacLean MOVED Amendment #1. There being NO OBJECTION, it was adopted. Representative Hoffman MOVED Amendment #2 which would clarify language on Page 21, Sections 1 - 3. [Attachment three sections into one section, Section A. There being NO OBJECTION, it was so ordered. SENATE BILL 100 5 "An Act making supplemental and special appropriations for the expenses of state government; making, amending, and repealing capital and operating appropriations; and providing for an effective date." Co-Chair MacLean MOVED TO RESCIND action taken on Amendment action was taken on Amendment #8. Representative Martin questioned why the funding for the new position adopted in Amendment #4 was not taken from funding allocated to Project Hope. Ms. Clarke responded Project Hope money is housed in the Department of Corrections. It is a different appropriation from the request by the Department of Health and Social Services, Division of Alcoholism position. Representative Therriault recommended backing funding out of the Project Hope supplemental. Representative Brown pointed out that Project Hope is not currently well defined. Ms. Frasca advised that the Governor had requested that funding as a FY 94 request, at which time the House Finance Committee decided not to consider it as part of the regular operating budget but to place it in the supplemental. Representative Brown MOVED a change to Section 75, Page 12, Line 23 amount from "$1.5 million dollars" to "$1.470 million dollars". Co-Chair MacLean OBJECTED. Co-Chair MacLean MOVED TO RESCIND action taken by the Committee in adopting Amendment #4. There being NO OBJECTION, it was so ordered. Co-Chair MacLean MOVED to include the Reappropriation Bill into HCS CS SB 100 (FIN). There being NO OBJECTION, it was so ordered. Co-Chair MacLean MOVED to report HCS CS SB 100 (FIN) out of Committee with individual recommendations. There being NO OBJECTIONS, it was so ordered. HCS CSSB 100 (FIN) was reported out of Committee with a "do pass" recommendation. ADJOURNMENT The meeting adjourned at 10:05 A.M. HOUSE FINANCE COMMITTEE APRIL 26, 1993 8:33 A.M. TAPE HFC 93 - 126, Side 2, #000 - end. TAPE HFC 93 - 127, Side 1, #000 - #535. 6 CALL TO ORDER Co-Chair Ron Larson called the meeting of the House Finance Committee to order at 8:30 A.M. PRESENT Co-Chair Larson Representative Brown Co-Chair MacLean Representative Foster Vice-Chair Hanley Representative Grussendorf Representative Hoffman Representative Martin Representative Navarre Representative Parnell Representative Therriault ALSO PRESENT Cheryl Frasca, Director, Division of Budget Review, Office of Management and Budget, Office of the Governor; Duane Guiley, Director, School Finance, Department of Education; Janet Clarke, Director, Administrative Services, Department of Health and Social Services; Representative Bettye Davis; Jay Hogan, Staff, House Finance Committee, Representative Ron Larson; Representative Jerry Mackie. SUMMARY INFORMATION SB 100 An Act making supplemental and special appropriations for the expenses of state government; making, amending, and repealing capital and operating appropriations; and providing for an effective date. HCS CS SB 100 (FIN) was reported out of Committee with a "do pass" recommendation. SENATE BILL 100 "An Act making supplemental and special appropriations for the expenses of state government; making, amending, and repealing capital and operating appropriations; and providing for an effective date." Co-Chair Larson listed items to be addressed in the work draft 8-GS1063\D, HCS CSSB 100 (FIN). His intention was to close Section #52 - Department of Corrections. Co-Chair Larson MOVED Amendment #1. [Attachment #1]. The Amendment would provide the sum of $5,553,400 appropriated from the general fund to the Department of Corrections for the fiscal year ending 6/30/93. There being NO OBJECTION, it was so ordered. 7 Co-Chair Larson provided the Committee with Amendment #2. [Attachment #2]. The sum of $1.150 million dollars appropriated from the general fund to the University of Alaska to pay the settlement agreement and legal costs associated with Dix. et al., v. University of Alaska. Representative Therriault MOVED Amendment #2, which would create a new section. There being NO OBJECTION, Amendment DUANE GUILEY, DIRECTOR, SCHOOL FINANCE, DEPARTMENT OF EDUCATION, introduced Amendment #3. [Attachment #3]. He stated that the Cooperative Agreement Grant Fund was established in legislation last year providing a grant fund program for school districts. The purpose of the legislation was to encourage cooperative agreements between school districts to provide more efficient and economical administrative and educational services. Over $1 million dollars were requested in the grant funds. Co-Chair Larson asked if any of the grants had been distributed. Mr. Guiley stated they had not. The legislation was passed last year although the fund was not capitalized when the legislation was passed. Representative Martin expressed disapproval of the legislation. Representative Hoffman MOVED Amendment #3. Co-Chair Larson OBJECTED. Representative Hoffman WITHDREW THE MOTION. Amendment #3 failed adoption. Co-Chair Larson explained the changes to Section #43. The subcommittee recommends increasing the sum to "$1,222,900" dollars. Representative Therriault MOVED TO RESCIND the original action in adopting the "$611,500". The original amount of funding would not adequately address the needed Dalton Highway repairs. There being NO OBJECTION, it was so ordered. Representative Therriault MOVED to add "$1,222,900" dollars to Section #43 for the Dalton Highway repairs and the aviation program for the current fiscal year. There being NO OBJECTION, it was so ordered. Co-Chair Larson discussed Section #72, the appropriation for the API facility. Representative Hanley MOVED a change to Page 12, Line 16, deleting "a" and changing "facility" to "facilities". He noted, the Mental Health Board requested the change. JANET CLARKE, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, commented the Department does not oppose the amendment. The amendment would continue to allow the Department to bill a central facility and would also allow flexibility for replacing sections of API which 8 need to be in regional or community settings. Representative Hanley provided the Committee background information regarding the facility. There currently is disagreement that Alaska needs a $60-$80 million dollar API. The Mental Health Board supports the legislation. Representative Brown recommended eliminating subsection (b), allowing funds to stay in the Mental Health account until a decision is reached. Ms. Clarke stated that the Department and the Mental Health Board have an agreement. One hundred and fourteen bed facility have been agreed upon. The current API facility will be down-sized to ninety beds. This is the smallest size facility which the Department can justify to provide the needed services. Representative Brown inquired how much of the appropriation would go to the proposed facility and how much to community facilities. Ms. Clarke replied that the community facilities envisioned would be in-patient hospital beds, although they have not yet been planned. Representative Hanley WITHDREW THE AMENDMENT. There being NO OBJECTION, it was withdrawn. Co-Chair MacLean MOVED Section #72. There being NO OBJECTION, it was so ordered. Co-Chair Larson provided the Committee with Amendment #4 which would appropriate $29.5 thousand dollars from the general fund to the Department of Health and Social Services, Alcohol and Drug Abuse Administration for line item allocations. [Attachment #4]. The amendment adds a new section. CHERYL FRASCA, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, explained the amendment would support the Governor's newly hired employee hired to address the alcohol and drug abuse problems in the State. The position was unexpected and not budgeted for in the new fiscal year. Representative Hanley asked if the position was funded in the budget next year. Ms. Clarke stated it was not. She said Lloyd Rupp, the ex-Commissioner of the Department of Corrections. Co-Chair MacLean MOVED the adoption of Amendment #4. Representative Martin OBJECTED. A roll call was taken on the MOTION. IN FAVOR: Navarre, Brown, Foster, Hoffman, MacLean, Larson. OPPOSED: Martin, Parnell, Therriault, 9 Grussendorf, Hanley. The MOTION PASSED, (6-5). Co-Chair Larson provided the Committee with Amendment #5. [Attachment #5]. The Alaska Science & Technology Foundation's Board of Directors fully supports the capital appropriation of $3 million dollars appropriated from the earnings of the endowment in the operating budget for FY 94. The request is for this amount to be transferred to BIDCO fund. Representative Martin suggested the adoption of the amendment would confuse the previously adopted intent language. Co-Chair Larson stated the language would supercede that previously adopted. Representative Brown MOVED Amendment #5. (Tape Change, HFC 93-127, Side 1). JAY HOGAN, STAFF, CONTRACT TO THE HOUSE FINANCE COMMITTEE, REPRESENTATIVE LARSON, stated the amendment would amend the bill previously passed out of Committee, substituting legislative intent for $3 million dollar appropriation in place of the current intent statement. Representative Martin OBJECTED to the amendment. A roll call was taken on the MOTION. IN FAVOR: Navarre, Parnell, Therriault, Brown, Foster, Grussendorf, Hanley, Larson, MacLean. OPPOSED: Martin. The MOTION PASSED, (10-1). Co-Chair Larson provided the Committee with Amendment #6. [Attachment #6]. Ms. Frasca explained the State of Alaska has concluded its negotiations with the Centralized Correspondence Study Education Association and the agreement has been ratified by the membership. The amendment requests the Legislature's approval of the contract's monetary terms. Representative Brown MOVED Amendment #6. There being NO OBJECTION, it was adopted. Co-Chair Larson provided the Committee with Amendment #7 requested by Representative Bettye Davis. [Attachment #7]. The amendment would add $100 thousand dollars from the 10 general fund to the Alaska School Counseling Program Grant Fund. Representative Brown MOVED Amendment #7. Representative Martin OBJECTED. REPRESENTATIVE BETTYE DAVIS spoke to the amendment. The funding would retrain counselors to work with problems children face in schools. The money would be spread throughout the State to train counselors to work with children in grades K-12. There has been no funding placed into the program for a number of years. Mr. Guiley disagreed and said funds are available for any purpose or scope of the grant awarded to the State. A roll call was taken on the MOTION. IN FAVOR: Parnell, Brown, Foster, Grussendorf, Hoffman, Navarre. OPPOSED: Therriault, Hanley, Martin, MacLean, Larson. The MOTION PASSED, (6-5). HCS CSSB 100 (FIN) was HELD in Committee for further discussion. REAPPROPRIATION LEGISLATION Co-Chair MacLean provided the Committee with Amendment #1 by Representative Mulder. [Attachment #8]. REPRESENTATIVE ELDON MULDER noted that Amendment #1 would reappropriate $50 million dollars back to Legislative Council for operations for the fiscal year ending 6/30/94. Co-Chair MacLean MOVED Amendment #1. There being NO OBJECTION, it was adopted. Representative Hoffman MOVED Amendment #2 which would clarify language on Page 21, Sections 1 - 3. [Attachment three sections into one section, Section A. There being NO OBJECTION, it was so ordered. SENATE BILL 100 "An Act making supplemental and special appropriations for the expenses of state government; making, amending, and repealing capital and operating appropriations; and providing for an effective date." Co-Chair MacLean MOVED TO RESCIND action taken on Amendment 11 action was taken on Amendment #8. Representative Martin questioned why the funding for the new position adopted in Amendment #4 was not taken from funding allocated to Project Hope. Ms. Clarke responded Project Hope money is housed in the Department of Corrections. It is a different appropriation from the request by the Department of Health and Social Services, Division of Alcoholism position. Representative Therriault recommended backing funding out of the Project Hope supplemental. Representative Brown pointed out that Project Hope is not currently well defined. Ms. Frasca advised that the Governor had requested that funding as a FY 94 request, at which time the House Finance Committee decided not to consider it as part of the regular operating budget but to place it in the supplemental. Representative Brown MOVED a change to Section 75, Page 12, Line 23 amount from "$1.5 million dollars" to "$1.470 million dollars". Co-Chair MacLean OBJECTED. Co-Chair MacLean MOVED TO RESCIND action taken by the Committee in adopting Amendment #4. There being NO OBJECTION, it was so ordered. Co-Chair MacLean MOVED to include the Reappropriation Bill into HCS CS SB 100 (FIN). There being NO OBJECTION, it was so ordered. Co-Chair MacLean MOVED to report HCS CS SB 100 (FIN) out of Committee with individual recommendations. There being NO OBJECTIONS, it was so ordered. HCS CSSB 100 (FIN) was reported out of Committee with a "do pass" recommendation. ADJOURNMENT The meeting adjourned at 10:05 A.M. 12