GENERAL SUBJECT(S): FY00 Department Overviews: Department of Corrections Department of Administration Department of Fish and Game Department of Transportation and Public Facilities The following overview was taken in log note format. Tapes and handouts will be on file with the House Finance Committee through the 21st Legislative Session, contact 465-2156. After the 21st Legislative Session they will be available through the Legislative Library at 465- 3808. Time Meeting Convened at 1:35 P.M. TAPE HFC 99 - 11, Side 1. TAPE HFC 99 - 11, Side 2. TAPE HFC 99 - 12, Side 1. TAPE HFC 99 - 12, Side 2. PRESENT: X Representative G. Davis Absent Co-Chair Therriault X Representative Foster X Co-Chair Mulder X Representative Grussendorf Absent Representative Austerman X Representative Kohring X Representative Bunde X Representative Moses Absent Representative J. Davies Absent Representative Williams ALSO PRESENT: DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE; MARGARET PUGH, COMMISSIONER, DEPARTMENT OF CORRECTIONS; DWAYNE PEEPLES, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF CORRECTIONS; SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF ADMINISTRATION; FRANK RUE, COMMISSIONER, DEPARTMENT OF FISH AND GAME; KEVIN BROOKS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF FISH AND GAME; JOSEPH PERKINS, COMMISSIONER, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES; NANCY SLAGLE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES; ROBERT POE, COMMISSIONER, DEPARTMENT OF ADMINISTRATION; ALISON ELGEE, DEPUTY COMMISSIONER, DEPARTMENT OF ADMINISTRATION; TAPE 99-11, SIDE 1 000 Co-Chair Mulder Convened the House Finance Committee meeting at 1:30 P.M. DEPARTMENT OF CORRECTIONS 144 MARGARET PUGH, COMMISSIONER, DEPARTMENT OF CORRECTIONS Noted that the Department of Corrections' primary mission is to provide statewide prison and jail service and supervision of parolees. She provided members with a handout, FY00 Operating Budget Overview (copy on file). 301 Commissioner Pugh Reviewed page 2. 343 Commissioner Pugh Alaska is 6th in the nation in regards to inmate growth. Continued growth will result in future problems with overcrowding. 491 Commissioner Pugh Reviewed short-term measures to deal with overcrowding. 531 Commissioner Pugh A year ago the Department of Corrections was at 125 percent capacity. The department is now below 100 percent. 631 Commissioner Pugh Discussed measures that were taken. Out- of-state contracts were entered. Successful tent programs were operated around the state. 668 Commissioner Pugh Began in November to use credit cards for bail in some institutions. This program has been successful. 718 Commissioner Pugh Expect to open community residential center (CRC) beds in Nome. 750 Commissioner Pugh Noted that the electronic monitoring program is scheduled to begin soon. 757 Commissioner Pugh Discussed new facilities. If everything continues to go well, Anchorage 400-bed facility will open around 1/2002. 824 Commissioner Pugh Discussed Highland Mountain conversion to an all-female facility. The mental health unit and substance abuse centers are fully functional. 904 Commissioner Pugh Discussed victims advisory groups. 941 Commissioner Pugh Hired 2 new probation officers and continued work on upgrading information systems. 967 Commissioner Pugh Budget focuses on providing for annual growth in offender population. They are working on a five-year plan. 1067 Commissioner Pugh Requesting part year funding for temporary housing units in Juneau, Fairbanks and Bethel. Will support 54 prisoners each. Costs will be comparable to sending prisoners to out-of-state contract facilities. 1111 Commissioner Pugh Requesting new 40-bed center at Spring Creek for youths. 1128 Commissioner Pugh Difference in actual cost for out of state beds will be included. 1201 Commissioner Pugh Noted that there are fund source changes. To jumpstart CRC beds, FY 96 FY 97 federal grants were used. 1207 Commissioner Pugh Referred to mental health planner. 1224 Representative Bunde Why is there a 16 percent increase in parolees? 1253 Commissioner Pugh Explained that it is an increase in probation and parolees. Both are growing populations. The increase over last year was in keeping with inmate growth. There may be bulges in certain areas due to individual cases such as drug arrests. 1328 Representative Bunde Questioned the per capita incarcerated rate in Alaska compared to other states. 1352 Commissioner Pugh Thought that Alaska is high, would provide exact numbers. 1377 Representative Kohring Questioned if the state's capacity level includes new facilities. 1403 Commissioner Pugh No, the capacity rate is based on current facilities only. Today is the first time that Cook Inlet is below full capacity. 1425 Representative G. Davis Referred to Wildwood. 1460 Commissioner Pugh Construction at Wildwood is related to improvements for administrative area and increased beds. 1483 Co-Chair Mulder Discussed contracts for outside beds. Questioned cost of beds. 1500 Commissioner Pugh $53 dollars per bed. There are 902 inmates that are out-of-state. There are some that are out under federal supervision. There are 873 in Arizona. Emphasized that there are not a lot of additional prisoners that can be transferred out-of-state. 1602 Co-Chair Mulder Estimated that out-of-state prisoners would remain between 850-900. 1622 Representative Kohring Questioned activities at Point Mackenzie. 1655 Commissioner Pugh 20 new beds were built. Inmates are rehabilitating rooms. 1663 Representative Kohring Asked the intent of the Department of Corrections for the facility. 1676 Commissioner Pugh The overall goal is for it to remain a farm that can raise animals and foodstuffs. 1721 DWAYNE PEEPLES, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF CORRECTIONS In response to a question by Representative G. Davis, clarified that the state is spending approximately $21.5 million on out-of-state prisoners. 1769 DEPARTMENT OF ADMINISTRATION 1775 ROBERT POE, COMMISSIONER, DEPARTMENT OF ADMINISTRATION Provided members with handout, FY00 Budget Overview (copy on file). 1813 Commissioner Poe Two major areas of concern; Y2K and labor contracts. 1862 Commissioner Poe Discussed Division of Motor Vehicles (DMV). Noted that DMV has an 11 percent acceptance rate. 1901 Commissioner Poe Noted budget issues. Observed the fiscal deficit. Emphasized willingness to look at ways to reduce costs. 1956 Commissioner Poe Stressed the need to find a new funding mechanism for the Alaska Oil and Gas Conservation Commission. Discussed $238 thousand dollar increment to bring inspectors even with number of wells. Stressed that additional inspectors are needed to serve industry. 1991 Commissioner Poe Discussed pioneer homes. New rate increase would result in 63 new positions. There would be two new positions per home. Commissioner Poe Observed that the children's initiative would be funded through tobacco settlement funding. Commissioner Poe Discussed leasing. Noted that it is traditionally underfunded. 2031 Commissioner Poe Observed that the Office of Public Advocacy and the Alaska Public Defenders Agency have been underfunded. There are increments for both. Office of Public Advocacy is involved in child in need cases and public guardian cases. 2084 Commissioner Poe Noted growth in senior population. 2105 Commissioner Poe Working with Senator Pearce to change funding for the Oil Gas Conservation Commission. Commissioner Poe Discussed longevity bonus. 2143 Commissioner Poe Discussed Work Place Alaska. Work Place Alaska helps managers. People can apply via the Internet. The division's personnel have decreased by a third since 1991. 2199 Commissioner Poe Discussed the $150 thousand dollar increment for senior services. The increment would fund services that are required by statute. It would replace mental health funds that were not available. 2214 Representative G. Davis Referred to the Bank of America building. Commissioner Poe Will get back with estimated savings. 2279 Representative Bunde Referred to new positions at the pioneer homes. Questioned how positions will address concerns regarding level of skill. 2309 ALISON ELGEE, DEPUTY COMMISSIONER, DEPARTMENT OF ADMINISTRATION Pointed out that a public forum was conducted in Anchorage last week. There are areas that need work. Department of Administration heard a number of positive comments. New positions are to keep ahead of the curve. Current staffing is only adequate. 000 TAPE 99-11, SIDE 2 TAPE CHANGE 039 SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OFADMINISTRATION In response to a comment by Representative Bunde, observed that the department's handout is also used for training employees. 214 Co-Chair Mulder Questioned the intention of labor negotiations. Observed that the Legislature passed a resolution during the 1998 session regarding labor negotiations. 243 Commissioner Poe Stressed that the Department of Administration intends to keep the legislature's position in mind 309 Commissioner Poe Discussed new positions; 17 positions are technical, 10 programmer positions were previously authorized, 10 are non-general funds, 63 are for new positions in pioneer homes, 3 in the Office of Public Advocacy are related to child protection funded by tobacco, and 6 positions to work on Y2K issues will only be during Y2K project. 387 Ms. Barton There are only 3 positions that are funded through the general fund. They are in the Office of Public Advocacy. 407 Representative Kohring Referred to the newly named Public Communications Services component. 435 Ms. Elgee This component was formerly called Alaska Rural Communications Services. It was renamed to reflect that it also covers satellite infrastructure, and public radio and television broadcasting. 499 Representative Kohring Expressed concern that public broadcasting should be paid for with state dollars. 544 Representative G. Davis Observed that the Division of Motor Vehicles brings in revenues over 30 million and only costs under 8 million. Representative Kohring Time to consider what is the primary focus of state government. Need to eliminate programs. DEPARTMENT OF FISH AND GAME 697 FRANK RUE, COMMISSIONER, DEPARTMENT OF FISH AND GAME Provided members with a handout, Mission Statement, Department of Fish and Game (copy on file). 787 COMMISSIONER RUE Introduced department directors. 847 Commissioner Rue Observed that there are six divisions. There are 820 permanent full-time employees and approximately 1000 part- time employees around the state. Mission to provide opportunity to use Alaska's resources on a sustained yield basis. Commissioner Rue Discussed opportunities to use resources. Noted that the department handles fishing licenses. Commissioner Rue Management costs of commercial fisheries brings in 2 percent more money than is spent. 1030 Commissioner Rue Pointed out that users pay for many programs. 1047 Commissioner Rue Maintained that Alaska has the healthiest stocks, habitat and the best management in the nation. Pointed out that Congress has expended $100 million dollars to fix salmon habitat in the Northwest United States. This is several times greater than the Department of Fish and Game's annual general funds budget. 1131 Commissioner Rue Commercial salmon harvest is 98 percent of the US commercial salmon harvest and 10 times that of British Columbia, Canada. 1188 Commissioner Rue Acknowledged that there are problems, emphasized commitment to sustained yield and providing opportunities. 1219 Commissioner Rue Emphasized that the department needs to maintain good research and science, promote good management, protect habitat and have good public process. 1237 Commissioner Rue Pointed out that the Department of Fish and Game's jurisdiction is greater than other departments. The Department of Fish and Game has responsibility offshore and inland, and for international treaties. 1292 Commissioner Rue Discussed page 3. The Department of Fish and Game receives 1.6 percent of the state's general funds. The department's general funds percentage has been going down as federal funding has increased. 1387 Commissioner Rue Discussed page 5. Fewer general funds than 1979. 1397 Commissioner Rue Discussed page 6. Noted breakdown of departments' budget by division. 76 percent of general funds are in commercial fisheries. 1457 Commissioner Rue Discussed page 7. Federal funds are growing. General funds are staying about the same. Interagency receipts are growing. 1532 KEVIN BROOKS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF FISH AND GAME Discussed interagency receipts. He observed that this is the result of SB 250, which was passed in 1998. There is a transfer into the divisions of Sport Fisheries and Wildlife Conservation due to SB 250. The transfer funds projects that were previously paid with Fish and Game funds. There is an additional $5 million dollars in interagency receipts. Mr. Brooks Discussed other legislation passed in 1998. There has been an $1.9 million dollar increase in federal receipt authority from federal aid contracts 1715 Mr. Brooks Discussed test fishery receipts in the Division of Commercial Fisheries. These are non-general funds positions. 1731 Mr. Brooks Noted that Exxon Valdez Oil Spill Settlement funds are being reduced. 1757 Mr. Brooks Fish and Game funds are down. 1761 Mr. Brooks Total funds are similar. 1783 Co-Chair Mulder Referred to interagency receipts. Mr. Brooks Noted that there are no new items. Co-Chair Mulder Referred to the $2.5 million increase to the Western region. 1823 Mr. Brooks Explained that there is an increase in test fisheries receipts for the observer program. Co-Chair Mulder Asked if revenues are down for commercial fisheries. 1846 Mr. Brooks Stated that they would have the estimated amount around 2/15/99. Estimate that revenues are down. 1883 Representative Bunde Noted that $700 thousand dollars were paid to vendors for licensing. Asked if it would be possible to recapture costs by having the department sell licenses. Suggested that a cap be put on the amount vendors can sell. Referred to the Duck Stamp program. Pointed out that there is a bargain on harvest tags. Questioned if seniors should continue to receive discounts. 2008 Commissioner Rue Trying to make it easier to get licenses over the Internet. 2041 Representative Bunde Asked if the decrease in licenses last season was due to increased charges or to poor forecasts on fisheries Mr. Brooks Responded that per unit sales were within 1 percent of the previous year's. Noted that there was a shift from non-resident licenses. 2085 Co-Chair Mulder Suggested that they could restructure the price to gain greater sales. 2098 Representative G. Davis Questioned 45 new positions? Noted that the purpose of one position is to work with schools. Questioned what that position would accomplish. 2120 Commissioner Rue Explained that the overall budget is going up. General funds are going down. Mr. Brooks Explained that none of the new positions are paid by general fund dollars. The Division of Sport Fish has 12, nine-month positions that are going to full-time. Observed that the number of hunters is decreasing nationally. 2272 Commissioner Rue Want to encourage kids to hunt with their parents. Representative G. Davis Noted that the economy is good. Government services are being requested while dollars are going down. 2360 Representative Moses Pointed out that vendors sell licenses as a convenience for customers. DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES 000 TAPE 99-12, SIDE 1 TAPE CHANGE 009 JOSEPH PERKINS, COMMISSIONER, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES Provided members with handout, FY00 Budget Overview, Department of Transportation and Public Facilities (copy on file). 0071 Commissioner Perkins Noted that the economy is good and that transportation is important to maintaining a good economy. Maintained that the state's transportation system has improved. 192 Commissioner Perkins Observed that the majority of residents surveyed felt that the Department of Transportation and Public Facilities is doing a good job. 52 percent of Alaskans surveyed are satisfies with roads. 268 Commissioner Perkins Noted that a lot of gravel roads still need to be paved. The federal capital budget has doubled. 367 Commissioner Perkins Discussed the Department of Transportation and Public Facilities' operating budget. Noted that the budget has gone down over the last 7 years and has not kept up with inflation. A large amount of the department's costs are fixed. Commissioner Perkins Discussed page 3. Pointed out that federal highway funds are being used to increase maintenance. The federal government won't pay for winter maintenance. The department is at the maximum amount that can be spent for summer maintenance. Anymore and there will be cuts in winter maintenance. Without the use of federal funds the department would have to lay off winter employees 561 Commissioner Perkins Can go 2 - 3 years before the federal funds are reduced. 587 Commissioner Perkins Discussed efficiency. Noted that it is hard to measure. Compared Alaska to other western states. Discussed page 2. Concluded that the Department of Transportation and Public Facilities is efficient. 625 Commissioner Perkins Department of Transportation and Public Facilities has 3,400 employees, 30 percent are federally funded. There are 178 engineers in the department. The program is being doubled. 767 Commissioner Perkins Discussed new positions. 82 new positions, 56 positions are for use on the Malaspina. Commissioner Perkins 10 positions for TEA-21 implementation of new federal funding. Commissioner Perkins 8 new positions in Anchorage International airport. Paid for through landing fees. 856 Commissioner Perkins Discussed positions in the Northern region. 917 Commissioner Perkins Discussed winter maintenance. Established equipment pools. Commissioner Perkins Discussed page 5, capital budget. 1000 Commissioner Perkins Discussed page 6. 88 percent of department personnel are work on the Alaska Marine Highway System or in maintenance and operations. These are the folks that are working. 1071 Co-Chair Mulder Asked if Kennicott is Y2K compliant. 1197 ROBERT DOLL, GENERAL MANAGER, FERRY OPERATIONS, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES Many of the suppliers for components of the Kennicott were European. No obvious Y2K problems. It is technologically sophisticated. 1223 Representative G. Davis Referred to trip of Kennicott to Seward, to bring legislators to Juneau. 1304 Mr. Doll Pointed out that alterations in schedule occur for a variety of reasons. Consideration is given to the total public interest. The advantage out weighed the disadvantage to others. 1498 Representative Bunde Referred to use of federal funds. Pointed out federal fund will run out and the state will be left paying for road maintenance. Asked plans for the Dalton highway. 1580 Commissioner Perkins The Dalton highway will be widen and paved. Stressed that paving the highway would save the base of the road in the future. The base for the Dalton highway will be replaced and capped. The state saves 40 percent on the maintenance of paved roads. Pointed out that graters are one of the most expensive pieces of equipment. 1710 Commissioner Perkins Observed that the Denali road has been scheduled for work via contract. Public hearings will be held. There is no schedule for its paving. The road opening may be delayed. 1760 Representative Bunde Referred to gas tax. 1801 Commissioner Perkins Expressed support for the gas tax. The gas tax will be spent to match federal funding. It hasn't been raised since 1961. Alaska would still be the 4th lowest in nation with a raise in its gas tax. Currently, Alaska has the lowest gas tax. It would be a statewide tax at the pump. 1871 Co-Chair Mulder Asked total amount needed for the match and the total amount that the tax will provide. 1901 Commissioner Perkins Will be approximately even. 1914 Co-Chair Mulder Tax will result in increased service. 1932 Commissioner Perkins Emphasized that the tax will be statutorily dedicated to highways. 1977 Co-Chair Mulder Questioned status of the federal language which allows Alaska to use federal funds on rural roads. 2099 Commissioner Perkins The language was not contained in the legislation that was passed by Congress. Work by Alaska's congressional delegation succeeded in clarifying that federal funding can be spent on any public road in Alaska. 2103 Representative Moses Pointed out that the highway tax will capture funding from nonresidents that travel in Alaska. 2132 Co-Chair Mulder ADJOURNED Senator Mulder adjourned the meeting at 3:58 p.m. HOUSE FINANCE COMMITTEE LOG NOTES January 29, 1999 H,F.C. 3 1/29/99