HOUSE FINANCE COMMITTEE January 28, 1998 1:40 P.M. TAPE HFC 98 - 9, Side 1. TAPE HFC 98 - 9, Side 2. TAPE HFC 98 - 10, Side 1. TAPE HFC 98 - 10, Side 2. CALL TO ORDER Co-Chair Hanley called the House Finance Committee meeting to order at 1:40 P.M. PRESENT Co-Chair Hanley Representative Kelly Co-Chair Therriault Representative Kohring Representative J. Davies Representative Martin Representative Grussendorf Representative Moses Representative Foster Representative Mulder Representative G. Davis was not present for the meeting. ALSO PRESENT Sister Helen Prejean, Louisiana; Rev. Pat Travers, Diocese of Juneau; Annalee McConnell, Director, Office of Management and Budget, Office of the Governor; Tom Lawson, Director, Division of Administrative Services, Department of Commerce and Economic Development; Keith Kelton, Director, Division of Facility Construction & Operation, Department of Environmental Conservation; Kurt Fredriksson, Director, Division of Spill Prevention & Response, Department of Environmental Conservation; Kenneth Bishchoff, Director, Division of Administrative Services, Department of Public Safety; Sharon Barton, Director, Division of Administrative Services, Department of Administration; Larry Streuber, Facilities/Planning Chief, Division of Administrative Services, Department of Health & Social Services; Laurie Perkins, Director, Division of Administrative Services, Department of Revenue; Nico Bus, Director, Division of Administrative Services, Department of Natural Resources & Department of Military & Veterans Affairs. SUMMARY COMMENTS ON THE DEATH PENALTY - SISTER PREJEAN HB 327 An Act making and amending capital appropriations and reappropriations and capitalizing funds; and providing for an effective date. HB 327 was HELD in Committee for further discussion. COMMENTS ON THE DEATH PENALTY REV. PAT TRAVERS, DIOCESE OF JUNEAU, introduced Sister Helen Prejean of Louisiana and provided written testimony by the Catholic Diocese of Juneau in opposition to institutionalizing the death penalty in the State of Alaska. SISTER HELEN PREJEAN, AUTHOR - DEAD MAN WALKING, LOUISIANA, provided a brief history of her involvement in working to abolish the death penalty throughout the United States. She discouraged the House Finance Committee members from adopting the proposed legislation making the death penalty legal in this State. During the past years, Sister Helen explained that she had accompanied four people to the electric chair, at the same time working with murder victim's families in their healing process. The Catholic nun from Louisiana said race, poverty, and vengeance unjustly influence how capital punishment is applied. Sister Prejean noted that she understood the political pressure regarding this issue. She pointed out that research indicates that people when initially asked if they want the death penalty will voice support. After fourteen years of educating the American people on the death penalty, once they understand and are shown how it works, most people reject that choice. When people reflect "below" the surface of the death, they then reject the death penalty. Sister Prejean pointed out that thirty-eight states currently have the death penalty. She questioned if this was a road that Alaska needs to walk. No matter how the bill is designed, including all safeguards, the reality is that it is only poor people on death row. She believed that was a direct result of the type of defense that poor people receive. She asked how would safeguards be built in, reminding legislators how expensive that would be. Sister Prejean asked what determines a crime that qualifies "killing" people. When a life of a human being is taken, that life is sacred and irreplaceable; it is a personal universe. When that death occurs, a line has been crossed and there is no way that adequate restitution can replace it. Sister Helen pointed out that what drives the death penalty in actual practice is who was killed. We say that we value equally the life of all citizens. She believed that who was killed determines the amount of outrage. Who the victim is and what outrage is felt over their death will be a large determining factor in who receives the death penalty. Coupled with the discretionary powers of the district attorney, the truth of "value of life" will become unbalanced. Then there becomes selectivity involved and race can not be escaped. Since 1976, each time in the practice of the death penalty in the United States occurs, it is when a white person has been killed. According to the Alaska Native Justice Center, of the eight people executed in the Territory of Alaska between 1900 and 1957, when the death penalty was abolished, only two were white. She continued, one could not make the predisposition that when someone is killed in a family that everyone in that family will want the death penalty for the person who did the killing. Murder victims families are not able to come to terms with their own grief solely by killing the killer. Sister Helen reiterated that every time someone dies, a personal universe has been lost. A death never replaces another life. She stressed that there could never be enough justice for the victims. Sister Helen went on to discuss the financial costs associated with capital punishment. It is estimated that the first murder trial will cost $50 million dollars. She recommended that money be poured into victims of violent crimes, into juvenile offenders, community policing and into things that make a difference when crime happens in a community. She elaborated that the people doing the thinking and the people doing the murder are not the same person. Police chiefs and others involved with crime know that violence is spawned from dead-end lives, alcohol and drugs, people with no future. Communities need to be infused with life, hope, jobs and education, which will make a difference. Sister Prejean pointed out that by instituting the death penalty, we imitate the behavior of the criminal, giving back the violence that person gave to the community. She pointed out the moral lesson to children by legalizing such action. When some people do some things, it is okay to kill them; instead, demonstrating in our State, no one is allowed to kill anyone. That is only God's power. The practice of the death penalty is the practice of societal hate and legalized vengeance. Sister Helen Prejean concluded by encouraging Committee members to choose the higher road, the moral road and not put the vote to the people. She reminded Committee members that "we're all human and we're all frail" and no one knows it better than the Legislators who put these laws together and made them work. (Tape Change HFC 98- 9, Side 2). HOUSE BILL NO. 327 "An Act making and amending capital appropriations and reappropriations and capitalizing funds; and providing for an effective date." Co-Chair Hanley informed members that the meeting would provide a general overview of the Capital Budget Request (CBR), noting that federal funds are not yet currently available. ANNALEE MCCONNELL, DIRECTOR, OFFICE OF MANAGMENT AND BUDGET, OFFICE OF THE GOVERNOR, provided Committee members with a handout summary sheet, "Governor Knowles' Proposed FY99 Capital Budget". [Attachment #2 - Copy on File]. Ms. McConnell acknowledged that the overall Governor's proposed budget of $871 million dollars was larger than last year's, mostly from increased federal funds. The Governor's capital plan for FY99 focuses on education, economic development, transportation, public safety and health. The $92.3 million dollars in general funds is approximately the same level as in FY98. However, federal funds increase by more than $150 million dollars, mostly for highways and airports. "Gateway Alaska" uses $191 million dollars in federal funds and revenue bonds for a major terminal expansion at the Anchorage International Airport. A little over 50% of the proposed budget will be provided by federal funds. State general funds will amount to 10%. The recommended Alaska Housing Finance Corporation (AHFC) share of the budget is $52 million dollars, which, together with a $1 million dollar to debt service for the University of Alaska-Anchorage (UAA) dorms and a $50 million dollar dividend to the general fund, will hold total contribution within the plan for maintaining an excellent credit rating. Alaska Industrial Development Export Authority (AIDEA) FY99 dividend of $16 million dollars, through this proposal would be appropriated to economic development projects statewide. Ms. McConnell noted that the budget bill does not include the Statewide Transportation Improvement Program (STIP) and the Airport Improvement Program (AIP) for final stages of public review and comment. The capital budget bill appropriates state matching funds for community projects throughout the State but does not list specific projects. As soon as the STIP and AIP are final, the lists will be released and the projects will be incorporated in the Governor's budget amendments available February 25th. Co-Chair Hanley clarified that this proposed legislation requests $100 million dollars in general funds, not $92.3 million dollars. He pointed out that $7 million had also been included for the Court System. Ms. McConnell agreed noting that whether the Administration agrees with the Court System's requests or not, they do not exercise authority over the Court System. Co-Chair Hanley advised that last year; the Administration did use the funds appropriated to the Court System for an item not related to the Courts. Ms. McConnell pointed out that there were two major elements of the overall capital plan not included in the proposed bill as they have been included in separate legislation. The School Construction Plan will address all of the major maintenance projects and new construction requested by the school districts for the next 10 years. Total recommended investment in that area is $720 million dollars. The tobacco tax increase will be recommended to be used to fund this legislation. That tax is projected to be approximately $34 million dollars per year. General fund money will be required in six years. Ms. McConnell agreed that it was an ambitious proposal. Representative J. Davies asked if the school construction plan would extend to university level needs. Ms. McConnell advised that the proposed bill would address needs only from K-12. The University has a CBR assessment in the amount of $7 million dollars for deferred maintenance. The Governor `s proposed program requires legislation and will carry a fiscal note. In response to Co-Chair Hanley, Ms. McConnell advised that the prison bill would cover expansion in three locations: Anchorage - 6th Avenue Jail, Bethel and Sutton. The proposed plan will address overcrowding in the prison system. The intent is to use lease-purchase financing with local communities. Ms. McConnell continued, a smaller portion of the proposal would convert the Harborview facility to a treatment facility for adults with disabilities and for adult offenders with serious alcohol and abuse problems. This funding request has been incorporated into all the budget plans. Co-Chair Therriault questioned the final understanding reached last year in relationship to the Harborview facility. Ms. McConnell noted that last year, the Legislature had included per bed costs, which then was vetoed by the Administration. The Department of Corrections has worked with that. She advised that it would cost three million-dollars in operating expenses to run the facility for a year. At that magnitude, the Legislature must be comfortable before the city of Valdez begins spending city funds. In-mate health care has not been included in that average. Co-Chair Hanley asked if the operating costs for Harborview as a treatment center had been included in the proposed operating budget. Ms. McConnell acknowledged that they had been included in that budget as a fiscal note item. Representative J. Davies asked where deferred maintenance items, other than those related to schools had been included in the proposed Capital Budget Request (CBR). Ms. McConnell replied that each department with maintenance responsibilities has some funds allocated for critical deferred maintenance needs. The current proposed budget does not deal with statewide-deferred maintenance. The Governor has determined the priority school needs. There is not enough money in the individual departmental budgets to keep the State from sliding further into maintenance problems. Co-Chair Hanley requested a list of operating needs which are above the Governor's budget request for each department. Representative Martin referenced the airport expansion and asked how that would be financed. Ms. McConnell stressed that the $3 dollar passenger tax would not be used for that request. Those funds would be generated through Airport Revenue Bonds. Co-Chair Therriault questioned how future costs would be tracked. Ms. McConnell pointed out that fiscal notes outline expense and debt service through the next six years. (Tape Change HFC 98- 10, Side 1). Ms. McConnell stated that the complete lists of projects to be funded for the water/sewer projects and Community Capital Matching Grants are in the Governor's bill and accessible on the OMB Web site. She offered to provide Committee members a copy of the five-year plan. DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT Representative Martin questioned the status of the Four Dam Pool. TOM LAWSON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, replied that the Four Dam Pool CBR increment would be used to make various repairs to the Terror Lake tunnel as well as the Tyee power transmission line. The money funds for this increment would come from statutory designated program receipts, users of the power. Representative Martin asked if any money was being paid toward debt service. Mr. Lawson offered to check into that concern for Representative Martin. DEPARTMENT OF ENVIRONMENTAL CONSERVATION Co-Chair Hanley requested information regarding the water/sewer-funding summary. KEITH KELTON, DIRECTOR, DIVISION OF FACILITY CONSTRUCTION & OPERATION, DEPARTMENT OF ENVIRONMENTAL CONSERVATION, explained the process used to determine community water/sewer needs. In terms of dollar amount, the Municipal Matching Grants program which also serves urban communities will remain status quo with last years request of $2 million federal receipt dollars and $14.6 million State general fund dollars. To comply with last year's legislative budget request for the Village Safe Water Program, there will need to be five separate appropriations. The federal funds available for match are $25 million dollars; $10 million dollars of that amount is not required for authority taxation. That money moves directly through the Rural Development Authority (RDA) to the communities. Mr. Kelton stated that $14 million dollars would be requested from budget EPA funds, $22 million GF dollars, $16 AHFC funds, which totals $53 million dollars for both programs. Co-Chair Hanley asked if the Department administered the Village Safe Water grants. Mr. Kelton replied that DEC takes advantage of that opportunity to receive the fees for the engineering studies, defined up-front, to authorize those projects. Co-Chair Therriault asked if it would be determined at that point if a community was capable to manage the facility. Mr. Kelton explained that DEC works closely with specialists within the Department of Community and Regional Affairs during the feasibility study analysis to define resources available within the communities to operate and maintain the completed projects. Representative J. Davies asked if rural development matches were administered directly from the Rural Development Authority (RDA). Mr. Kelton stated that those funds were not received by the Department, although, do receive the benefit of them. A match does have to be provided. Ms. McConnell added that the project details outline where RDA funds become involved. Co-Chair Therriault asked the source of "other" funds used to upgrade the state owned storage tanks. KURT FREDRIKSSON, DIRECTOR, DIVISION OF SPILL PREVENTION & RESPONSE, DEPARTMENT OF ENVIRONMENTAL CONSERVATION, noted that the funding source would be the State Response Fund. He added that there are two different programs within that account, the Response Account and the Prevention Account. FRONT SECTION Co-Chair Hanley questioned the amount requested for finger printing. Ms. McConnell stated that the amount requested would fully fund the Sitka Academy expansion for the women's dorm. Co-Chair Hanley asked how much money was remaining from last year's capital appropriation for the replacement system. KENNETH BISCHOFF, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF PUBLIC SAFETY, stated that the full amount of the appropriation was available for reappropriation. Co-Chair Hanley asked if that amount was increased in the capital budget elsewhere. Mr. Bischoff replied that the Department would be requesting an increment to the Criminal Records component to supplement what was available and budgeted for the membership fee. That increment will help the State locate finger print records with six other western states. Ms. McConnell added, at the time the initial request had been made and approved, the Administration determined the best option for the State would be to buy their own finger printing system. Upon further research, it appeared that a better solution would be to join the Western State's program. The proposal now is to join that network. Mr.Bischoff stated that the increase to the operating budget would be a $116 thousand dollar on-going expense. DEPARTMENT OF ADMINISTRATION Representative Martin questioned the information service source of funding. SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF ADMINISTRATION, advised that those funds would come from the Information Services Fund and would be used for out dated equipment. Money in that fund is carried over from year to year. Co-Chair Hanley requested a summary of the total amount spent each year in the State for computers as well as information on the year 2000 changeover. Ms. McConnell noted that a meeting had been scheduled with the new House of Representatives Telecommunications Committee to discuss the year 2000 change. Co-Chair Therriault asked what the Time and Attendance program was. Ms. Barton explained that currently, time and attendance is a manual effort for paychecks. The proposed increment would create an automated system from the employee to the paycheck. Proposed is only Phase 1 to determine what systems fit and could be integrated into full automation. Ms. McConnell added, the Administration is trying to adopt many of the best and innovative private sector business practices. DEPARTMENT OF COMMUNITY & REGIONAL AFFAIRS Representative Kohring asked why the State was involved with the Alaska Native Heritage Center project. Ms. McConnell replied that there are a lot of projects in the State, which create partnerships with local governments and the private sector in developing jobs. The proposed projects have been well supported because they not only create jobs but also enhance tourism. DEPARTMENT OF CORRECTIONS Representative J. Davies referenced the deferred maintenance line in the budget. Ms. McConnell noted that was the first project listed in the detail book. On all deferred maintenance appropriations, the Administration does not recommend a specific appropriation for a specified item. Where that money is ultimately spent should be for the projects which have a critical need during the fiscal year. Ms. McConnell noted that the Administration is anticipating a CBR under $100 million dollars, and that emergencies can not always be funded as requested by each department. An attempt was made to include a balance of projects, coming up with a minimum of $800 thousand dollars. DEPARTMENT OF HEALTH AND SOCIAL SERVICES Representative Kohring asked clarification on the welfare reform information system. LARRY STREUBER, FACILITIES/PLANNING CHIEF, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, stated that there was a need to upgrade the systems for office automation in Anchorage and other administrative areas. The need was to provide equipment to interface with the mainframe in order to make the changes required with passage of last year's legislation. Ms. McConnell added that federal law has required the State to overhaul its computer equipment, also. DEPARTMENT OF REVENUE LAURIE PERKINS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF REVENUE, responded to questions by Representative Kohring regarding the Child Support Enforcement Division (CSED). This year, the Department is not requesting further capital funding for that division. Representative Kohring voiced concern regarding complaints he received about CSED's aggressive behavior. Ms. McConnell reminded members that the CSED agency is involved in highly emotional work, stressing that many people feel that CSED should be more aggressive. There are tremendous arrearages from people who have not paid what is due to their own children. The computer system deals with data issues necessary to meet federal requirements. Members discussed constituent's frustrations in dealing with the CSED agency. Representative Martin requested updated information regarding how many people are leaving the welfare roles to join the work force. (Tape Change HFC 98- 10, Side 2) Co-Chair Hanley echoed Representative Martin's concern with how the collection efforts are working within all the departments. Ms. Perkins reiterated that most of the money spent on computer results from increased data requirements placed by the federal government. Collections are increasing and the amount of time to implement these changes is decreasing. She offered to provide specifics on that information at subcommittee level. CSED computers will be shut down the last week in February at which time the new systems will be installed and up and running by March 1st. DEPARTMENT OF NATURAL RESOURCES Representative J. Davies asked if the recorders office project would allow digitizing documents directly. NICO BUS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF NATURAL RESOURCES, replied that the intent of those projects was not to digitize the documents, but rather, to replace equipment and film the 1970-1977 record database. This project had been proposed last year. Currently, the State is trying to work out a cooperative partnership with private industry in this matter. Representative Kohring voiced his support for the coal bed methane increment. Mr. Bus agreed that this was an exciting program with great potential. HB 327 was HELD in Committee for further discussion. ADJOURNMENT The meeting adjourned at 3:55 P.M. H.F.C. 1 1/28/98