HOUSE FINANCE COMMITTEE JANUARY 25, 1995 1:35 P.M. TAPE HFC 95 - 5, Side 2, #000 - end. TAPE HFC 95 - 6, Side 1, #000 - end. TAPE HFC 95 - 6, Side 2, #000 - #213. CALL TO ORDER Co-Chair Mark Hanley called the House Finance Committee meeting to order at 1:35 P.M. PRESENT Co-Chair Hanley Representative Kohring Co-Chair Foster Representative Martin Representative Mulder Representative Navarre Representative Brown Representative Kelly Representative Grussendorf Representative Therriault Representative Parnell was not present for the meeting. ALSO PRESENT Karen Perdue, Commissioner, Department of Health and Social Services; Janet Clarke, Director, Administrative Services, Department of Health and Social Services; Gene Burden, Commissioner, Department of Environmental Conservation; Len Verrelli, Air Quality Management Section, Department of Environmental Conservation; Tom Cashen, Commissioner, Department of Labor; Arbe Williams, Director, Division of Administrative Services, Department of Labor; Adjutant Major General Jake Lestenkof, Commissioner, Department of Military & Veterans Affairs; Jeff Morrison, Director, Division of Administrative Services, Department of Military and Veterans Affairs; Mike Greany, Director, Legislative Finance Division; Representative John Davies; Representative Tom Brice; Representative Gene Kubina; Representative Irene Nicholia; Representative Ed Willis. SUMMARY AGENCY OVERVIEWS: Department of Environmental Conservation Department of Health and Social Services Department of Labor Department of Military and Veterans Affairs 1 (*Copies of log notes, meeting tapes and handouts are on file with the Legislative Finance Division. Contact #465- 3795). Log DISCUSSION DEPARTMENT OF ENVIRONMENTAL CONSERVATION Committee meeting to order at 1:35 P.M. ENVIRONMENTAL CONSERVATION (DEC), provided a brief overview of the Department. The intent of DEC is to protect public health from environmental threats, and to conserve, protect and improve Alaska's environment for present and future generations. Commissioner Burden provided the Committee with a handout. [Copies on file - Attachment #1]. has five areas of responsibility. assures wholesome fish, meat, and dairy products for consumers and enforces basic standards of sanitation in public facilities. ensures compliance with air, land and water pollution laws to protect public health and the environment. Operation Division which provides financial and technical assistance to local communities for construction and operation of water, sewer and solid waste projects. Division which improves the state's capability to prevent, respond to, and clean up pollution from oil and hazardous substances. Services Division which provides overall 2 financial, employee and informational services to the public and within the Department. budget was adequately funded to address the needs of the small communities. DEPARTMENT OF ENVIRONMENTAL CONSERVATION, noted that the Department is investigating ways to compensate for budget shortfalls. Grussendorf and Mr. Verrelli regarding the Department's responsibility in the prevention of shellfish poison. percent increase to the Solid Waste Management component of the budget. Mr. Verrelli explained that recent cuts have stripped the program's ability to operate in compliance with the EPA standards. proposed budget has not been fully evaluated and that the Department would appreciate broader recommendations from the Legislative body. Mr. Verrelli explained most increases to the DEC budget resulted from federal mandates. addressing the proposed budgetary increase to the DEC budget. Department had existed as an independent entity. Commissioner Burden replied since 1972. Representative Kelly pointed out that the DEC budget began to increase in 1990 and has not returned to the pre-spill level. requires a maintenance effort to maintain spill response. The bulk of those funds are federally received. DEC currently has responsibilities which are not fully functioning because of budget 3 cuts. He recommended a policy call to discontinue those programs. Environmental Conservation was completed. DEPARTMENT OF MILITARY AND VETERANS AFFAIRS COMMISSIONER, DEPARTMENT OF MILITARY & VETERANS AFFAIRS (DMVA), explained the components of the Departments proposed budget. 1. National Guard - A large investment for the State. 2. Emergency Services 3. Responsibility to Veterans Affairs. he pointed out the total number of veterans in Alaska is 68,000. planned to continue funding the youth corp. Major General Lestenkof noted it was a program which was working well and which received total funding through the federal government. million dollar increase to the Disaster Relief Fund. ADMINISTRATIVE SERVICES, DEPARTMENT OF MILITARY AND VETERANS AFFAIRS, advised that the $12 million dollars consisted of $3 million dollars general funds and $9 million dollars federal funds. These funds are allocated for anticipated disasters. regarding forward funding of the DMVA budget. Discussion followed among Committee members and Mr. Morrison addressing that concern. National Guard personnel had changed over the years. 4 continues to be a slow drop rate. The manning level for Alaska has not yet been determined although he suggested that the level should stabilize soon. Federal funding is determined by the strength and number of units per state. Military and Veterans Affairs was completed. DEPARTMENT OF HEALTH AND SOCIAL SERVICES HFC 6 - 1 KAREN PERDUE, COMMISSIONER, DEPARTMENT OF HEALTH AND #000 SOCIAL SERVICES (DHSS), acquainted herself to the Committee and explained the mission of the State of Alaska Department of Health and Social Services: To promote and protect the physical, emotional, social and economic well-being of Alaskans so that each person can be as self- sufficient as possible. of volunteerism in communities throughout the State. She added that federal funds comprise 40% of the proposed DHSS budget. Representative Martin's queries regarding single pay health insurance explaining that it would provide coverage for every person in the State. The plan will move forward slowly, she thought taking many years to come to full fruition. regarding the excelarated migration of low- income persons to Alaska. Commissioner Perdue thought that the Alaska Permanent Fund and the Longevity Bonus might encourage the movement North. budgetary status of the proposed alcohol and drug abuse component. Commissioner Perdue emphasized that alcohol is the most pervasive problem in Alaska and results in continuation of rising costs to all departments. She added, the proposed Hickel Administration 5 budget sustains status quo funding for that component. Commissioner Perdue and Committee members regarding welfare reform intentions. Commissioner Perdue noted that this concern was a high priority for Governor Knowles and that he has established a six member task force to identify agency resources in order to increase self sufficiency in those persons receiving Aid to Families and Dependant Children (AFDC). SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, acknowledged that there would be large changes to the welfare system, although emphasized that 95% of the Department rules are established by federal mandates. with DHSS promising more services without increasing the budget. Commissioner Perdue reminded the Committee that all solutions will cost the State money. Brice's question regarding interdepartments working through AFDC, DHSS and child support distribution and payment through the Department of Revenue (DOR). encouraging more volunteer services in agency work to help solve budget costs. concluded their FY96 agency overview. DEPARTMENT OF LABOR LABOR, provided the Committee with a handout. [Copies on file - Attachment #3]. The mission of the Department of Labor as established in Title 23 is to foster and promote the welfare of the wage earners in the State, improve their working conditions and advance their opportunities for profitable employment. 6 Knowles recommended that positions not be filled unless they were essential. He added, there would be a reclassification of certain range scale levels. Commissioner's Office and four divisions: 1. Administrative Services Division 2. Employment Security Division 3. Labor Standards & Safety Division 4. Worker's Compensation Division fund process and receipts. ADMINISTRATIVE SERVICES, DEPARTMENT OF LABOR, advised that the majority of those funds are reinvested into that program. should be made across the board rather than to individual components. Discussion followed among Committee members regarding that concern. with inter-department duplication of occupational safety services. Ms. Williams stressed that the State OSHA program is not a duplication of the federal one. The Knowles Administration is looking for further cost reductions to the budget for the Department. the workmen's compensation increase for small businesses. Representative Navarre pointed out that the changes made to that program in 1988 have been detrimental to the small state employees and employers. HFC 6 - 2 Representative Therriault agreed that the current #000 workmen's compensation system does not appear to be working for either the employee or employer. He pointed out the continued abuse of that system. medical costs associated with the problems of 7 the current workmen's compensation system. Representative Mulder informed Committee members of the Ad Hoc Task Force appointed by Governor Knowles to address these concerns. agency overview. ADJOURNMENT The meeting adjourned at 3:10 P.M.