HOUSE FINANCE COMMITTEE May 18, 1999 4:20 A.M. TAPE HFC 99 - 148, Side 1 TAPE HFC 99 - 148, Side 2 CALL TO ORDER Co-Chair Therriault called the House Finance Committee meeting to order at 4:20 a.m. PRESENT Co-Chair Therriault Representative Foster Co-Chair Mulder Representative Grussendorf Vice Chair Bunde Representative Kohring Representative Austerman Representative Moses Representative J. Davies Representative Williams Representative G. Davis ALSO PRESENT Annalee McConnell, Director, Office of Management and Budget, Office of the Governor; Dan Spencer, Chief Budget Analyst, Office of Management and Budget, Office of the Governor; Kenneth Bischoff, Director, Division of Administrative Services, Department of Transportation; Brian Butcher, Staff, Representative Therriault; Tom Lawson, Director, Administrative Services, Department of Commerce and Economic Development; Joe Perkins, Commissioner, Department of Transportation and Public Facilities; Tom Brigham, Director, Division of Statewide Planning, Department of Transportation and Public Facilities. SUMMARY CSSB 32(FIN) am "An Act making and amending appropriations and reappropriations; making and amending appropriations under art. IX, sec. 17(c), Constitution of the State of Alaska, from the constitutional budget reserve fund; and providing for an effective date." HCS CSSB 32 (FIN) was REPORTED out of Committee with a "do pass" recommendation. CS FOR SENATE BILL NO. 32(FIN) am "An Act making and amending appropriations and reappropriations; making and amending appropriations under art. IX, sec. 17(c), Constitution of the State of Alaska, from the constitutional budget reserve fund; and providing for an effective date." Co-Chair Therriault provided members with a proposed committee substitute for SB 32, work draft 1-GS1022\S, 5/17/99 (copy on file). Co-Chair Mulder MOVED to ADOPT work draft 1-GS1022\S, 5/17/99. There being NO OBJECTION, it was so ordered. Co-Chair Therriault MOVED to ADOPT Amendment 1 (copy on file). He explained that Amendment 1 contains a number of amendments sponsored by the Administration. Insert the following new sections: DEPARTMENT OF ADMINISTRATION. The sum of $165,000 is appropriated from the general fund to the Department of Administration, public defender agency, for operating costs for the fiscal year ending June 30, 1999. ALASKA CHILDREN'S TRUST. (a) The designated program receipts (AS 37.05.146(b)(3)) received from the issuance of Heirloom Birth Certificates during the fiscal years ending June 30,1999 and June 30, 2000 is appropriated to the Alaska children's trust (AS 37.14.200) in accordance with AS 18.50.225(a). (b) The appropriation made in (a) of this section is retroactive to July 1, 1998. DEPARTMENT OF LAW. The sum of $575,000 is appropriated from the following sources to the Department of Law, governmental affairs, to investigate and prosecute the claims of state and municipal agencies against the Bank of America and certain other affiliated banks for the fiscal years ending June 30, 1999 and June 30, 2000: General fund $250,000 Statutory designated program receipts 325,000 DEPARTMENT OF LAW. The sum of $230,354 is appropriated from the general fund to the Department of Law to pay judgments and claims against the state for the fiscal year ending June 30, 1999. (Add to immediate effective date section). DISASTER RELIEF FUND. (a) The sum of $630,200 is appropriated from the general fund to the disaster relief fund (AS 26.23 .300) for costs associated with disasters. (b) The appropriation made by (a) of this section is retroactive to May 31, 1999. (Add reference to this section to Sec. _______ (capitalized funds)) DEPARTMENT OF MILITARY AND VETERANS AFFAIRS. The sum of $27,000 is appropriated from the general fund to the Department of Military and Veterans Affairs for costs associated with search and rescue missions for the fiscal year ending June 30, 1999. DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT. (a) The unexpended and unobligated balance on June 30, 1999, of the federal receipts from the United States Agency for International Development grant authorized by RPL 08-8-0001 is appropriated to the Department of Commerce and Economic Development for programs under the grant agreement for the fiscal year ending June 30, 2000. (b) The sum of $118,000 is appropriated from federal receipts to the Department of Commerce and Economic Development for programs under a grant agreement with the United States Agency for International Development for the fiscal year ending June 30, 2000. DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS (a)The sum of $600,000 is appropriated from federal receipts to the Department of Health and Social Services, ChildCare Benefits for the fiscal year ending June 30, 1999. (b) The appropriation made in Section 31, ch. 137, SLA 1998, p. 21, line 6 (Department of Community and Regional Affairs, Child Assistance) and amended in Section 10, ch. 2, SLA 1999, page 9, lines 20 is reduced by $350,000 general funds and increased by $350,000 interagency receipts. DEPARTMENT OF HEALTH AND SOCIAL SERVICES. The sum of $1,460,400 is appropriated to the Department of Health and Social Services for additional costs of the Foster care program for the fiscal year ending June 30, 1999 from the following sources: General fund $350,000 Federal receipts 860,000 Inter-Agency receipts 250,000 DEPARTMENT OF LABOR. The sum of$.1,255,000 is appropriated from costs for the fiscal year ending June 30, 1999. DEPARTMENT OF LABOR. The unexpended and unobligated general fund balance, not to exceed $31,000, of the appropriation made in sec. 17, ch. 79, SLA 1993, page 6, line 2 (workers' compensation records imaging - $383,800) is reappropriated to the Department of Labor for the workers' compensation information handling systems project. MILITARY AND VETERANS AFFAIRS. The sum of $35,000 is appropriated from designated program receipts (AS 37 .05. 146(b)(3)) to the Department of Military and Veterans Affairs for operations and maintenance costs of the Alaska National Guard Kotzebue hangar for the fiscal year ending June 30, 1999. DEPARTMENT OF Natural RESOURCES. Section 131, ch. 139, SLA1998, page 53, line 4 is amended to read: Appropriation General Other Items Funds Trails Federal Grants $525.000 [$200,000] Section 132, ch.139, SLA1998, page 109, line 16 is amended to read: Federal Receipts 2.665.000 [2,340,000] Add a new supplemental item to read: The sum of$191,250 is appropriated from federal receipts to the Department of Public Safety, highway safety planning agency -federal grants, for grant activities for the fiscal year ending June 30, 1999. ANNALEE MCCONNELL, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR reviewed Amendment 1. Representative Grussendorf questioned if judgments and claims in the Department of Law were included. Ms. McConnell affirmed that they were included and added that all of their concerns were included. There being NO OBJECTION, Amendment 1 was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 2. Insert a new section. (a) The unexpended and unobligated balance on June 30, 1999, of the appropriation from the general fund made in sec. 31, ch. 137, SLA 1998, page 55, line 25 (Village Public Safety Officer Program -$7,245,500) is reappropriated to the Department of Public Safety for the following purpose and in the amount stated for the fiscal year ending June 30, 2000. PURPOSE Fish and Wildlife Protection Equipment $250,000 (b) If the amount available for reappropriation under (a) of this section is less than $250,000, then the reappropriation made by (a) of this section shall be reduced by the amount of the shortfall. (c) The appropriation made by this section is for a capital project and lapses under AS 37.25.020. Ms. McConnell explained that Amendment 2 would pay for yearly operational equipment. There being NO OBJECTION, it was so ordered. Co-Chair Therriault MOVED to ADOPT Amendment 3. Insert a new section. DEPARTMENT OF PUBLIC SAFETY (a) The proceeds from the sale of three aircraft, including parts inventory, by the Department of Public Safety are appropriated from the general fund to the Department of Public Safety for the purchase of replacement aircraft. (b ) The appropriation made under this section is for a capital project and lapses under AS 37.25.020. DAN SPENCER, CHIEF BUDGET ANALYST, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR explained that Amendment 2 takes FY99 funds. KENNETH BISCHOFF, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF TRANSPORTATION clarified that the department has not decided if there would be more than one aircraft. There being NO OBJECTION, Amendment 3 was adopted. Vice-Chair Bunde MOVED to ADOPT Amendment 4 (copy on file). Insert a new sections: (a) The sum of $3,000,000 is appropriated from federal receipts to the Department of Health and Social Services, ChildCare Benefits for the fiscal year ending June 30, 1999. (b ) The appropriation made in Section 31, ch. 137, SLA 1998, p. 21, line 6 (Department of Community and Regional Affairs, Child Assistance) and amended in Section 10, ch. 2, SLA 1999, page 9, line 20 is reduced by $2,000,000 general funds and increased by $3,000,000 interagency receipts and lapses June 30, 2001. The sum of$2,100,000 is appropriated to the Department of Health and Social Services for a special project for child protection for the fiscal years ending June 30, 1999, June 30,2000 and June 30,2001 from the following sources: General Fund $1,800,000 Federal receipts $300,000 The sum of $200,000 is appropriated from the general fund to the Department of Health and Social Services as a capital appropriation for Family Services Field Safety, Office and Transportation Equipment. EXPLANATION: This amendment allows an immediate beginning for a special project for child protection to provide funds for contracts and project workers to reduce the back-log of children in the Foster Care system (see attached proposal). The first section appropriates $3.0 million additional federal receipts to DHSS Public Assistance ChildCare. This will allow DHSS to transfer funds to DCRA childcare. The second section replaces $2.0 million general fund in DCRA with interagency receipts (TANF federal coming from DHSS), also extends the lapse date so that the balance is kept in reserve, if the Legislature chooses to continue the project for a second year. The third section makes an appropriation of $1.8 million to DHSS for the special project for child protection, using the general funds from child assistance, plus $300.0 federal receipts from Title IVE. Ms. McConnell explained that Amendment 4 would allow permanent placement for 397 children that have been in foster care for at least 18 months. Federal regulation requires that these children be placed in permanent care by the end of the next fiscal year. It also allows $200.0 general fund dollars for a capital appropriation for safety equipment for Family Services field offices. In addition, $800 thousand general fund dollars would be carried forward. Vice-Chair Bunde noted that intent language would require that a preliminary report be given to the Department of Health and Social Services budget subcommittees. Both co- chairs of the Health, Education and Social Services Committee would be involved. There being NO OBJECTION, Amendment 5 was adopted. Vice-Chair Bunde MOVED to ADOPT Amendment 5 (copy on file). Insert a new section: The unexpended and unobligated balance, not to exceed $82,000, of the appropriation made in sec. 18( d), ch. 139, SLA 1998, page 7, lines 15 -18 (Department of Health and Social Services, costs related to reducing the adoption caseload backlog -$866,667), is reappropriated to the Alaska Court System for the special project for child protection for the fiscal years ending June 30, 1999, June 30, 2000 and June 30, 2001. EXPLANATION: This amendment funds the increased court costs that will result from the two-year special project for child protection. That project seeks to move 397 children who have been in state custody for more than 18 months to a permanent home. In approximately 60 percent of those cases, the state will have to go to court to seek termination of parental rights. Because of their complexity, the trials in such cases can take weeks. Co-Chair Therriault noted that in order to get children through the system paternal rights may have to be terminated. There being NO OBJECTION, Amendment 5 was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 6 (copy on file). Insert a new section: (a) The unexpended and unobligated balance on June 30,1999 of the general funds appropriated by sec. 31, ch137, SLA 1998, page 26, lines 6-14, as amended by sec. 9(b), ch. 2, SLA 1999 (K-12 Support - $726,760,700), not to exceed $250,000 is reappropriated to the following departments in for the following purposes in the amounts listed: Department of Administration -Satellite Interconnection Project Equipment Replacement and Repair $150,000 Department of Administration -Pioneers' Homes Health and Safety Repairs 100,000 < > (a) The unexpended and unobligated balance on June 30, 1999 of the general funds appropriated by sec. 31, ch137, SLA 1998, page 26, lines 6-14, as amended by sec. 9(b), ch. 2, SLA 1999 (K-12 Support - $726,760,700), remaining after the appropriation in (a) of this section, not to exceed $700,000, is reappropriated to the Department of Transportation and Public Facilities for operating expenses for the fiscal year ending June 30, 2000. Ms. McConnell explained that the amendment would use lapsing funds to support two projects in the Department of Administration, satellite connection and pioneer home repairs. Representative J. Davies questioned if the amendment appropriated more than is available. Ms. McConnell explained that the total available is $726 million dollars. There being NO OBJECTION, Amendment 6 was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 7A. Insert a new section: Page 31, following line 9: Sec. 72. The unexpended and unobligated balance of the appropriation made in sec. 19, 4 ch. 79, SLA 1993, page 11, lines 6 -7 (Community/Regional inpatient facilities. $1,000,000) 5 i$ reappropriated to the Department of Health and Social Services for construction of a 6 juvenile detention center." Page 43, line 8 -9 (Department of Health and Social Services, Ketchikan Juvenile Detention 15 Center): Delete "500,000' and Insert " 150,000". BRIAN BUTCHER, STAFF, REPRESENTATIVE THERRIAULT explained Amendment 7A is a net zero. There being NO OBJECTION, Amendment 7A was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 7 (copy on file). Insert a new section: Add on page 33, line 18 Maintenance, Renewal, Repair, Renewal and Replacement 800,000 General Funds There being NO OBJECTION, it was so ordered. Co-Chair Therriault MOVED to ADOPT Amendment (8 Page 28, lines 23 through 28: Delete all) He explained that the amendment deletes duplicate language. There being NO OBJECTION, it was so ordered. Co-Chair Therriault MOVED to ADOPT Amendment 9 (copy on file). Insert: Page 49, lines 17-20 Anchorage Area Contingency for 721,000: 65,200 in general funds and 655,800 in federal receipts Planning/Construction Shortfalls and Road/Intersection Improvements (ED 10-25) The reappropriation of the $65,200 contained in the front section on page 26, lines 9-11 of the proposed committee substitute would eliminate the general fund match needed for this project. In the FY'99 capital budget $655,800 of federal receipts and $65,200 of general funds were appropriated to the Anchorage Area Contingency for Planning/Construction Shortfalls and Road/Intersection Improvements. However, according to the Department of Transportation, the legislature appropriated General Funds to projects without having the necessary federal authorization to match the general fund appropriations. In the Senate version of SB 32, $655,800 of federal receipts and $0 general funds was appropriated to the Anchorage Area Contingency for Planning/Construction Shortfalls and Road/Intersection Improvements. This appropriation of federal funds would match the FY'99 appropriation of general fund match for the project since the Senate version of SB 32 did not exceed the authorized federal receipt authority. There being NO OBJECTION, Amendment 9 was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 10 Insert a new section: (a) Subject to (b) of this section, the sum of $185,000 is appropriated from the Oil/Hazardous Prevention and Response Fund and the sum of $200,000 is appropriated from the Storage Tank Assistance Fund to the Department of Environmental Conservation for costs associated with implementing SB 128. (B) The appropriation made by (a) of this section is conditioned on the enactment into law in 1999 of a version of SB 128, relating to the storage tank assistance fund. Ms. McConnell clarified that the Conference Committee on the operating budget did not adopt the fiscal note. Co-Chair Mulder explained that the amendment would be on the new fiscal note on SB 128 when it comes before the House for consideration. There being NO OBJECTION, Amendment 10 was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 11. Insert a new section: (a) Subject to (b ) of this section, the sum of $55,699 is appropriated from general funds to the Alaska Court System for costs associated with implementing the geographical cost of living provisions contained in HB 199. (B) The appropriation made by (a) of this section is conditioned on the enactment into law in 1999 of a version of HB 199, relating to compensation for certain state employees. Co-Chair Therriault explained that the appropriation is contingent on passage of HB 199. There being NO OBJECTION, Amendment 11 was adopted. Co-Chair Therriault MOVED to ADOPT Amendment 12. Insert a new section: After the appropriation for $517,500 from general fund program receipts co1lected under AS 43.70.030 made to the Department of Commerce and Economic Development, division of occupational licensing, under a section of CCS HB 50, an amount not to exceed $100,000 is appropriated from the genera' fund program receipts col1ectcd under AS 43.70.030 to the Department of Commerce and Economic Development, division of trade and development, for programs for the development of international trade for the fiscal year ending June 30, 2000." Co-Chair Therriault explained that the amendment makes a $100 thousand dollar adjustment in the Department of Commerce and Economic Development in acknowledgement that the cuts were too deep. Co-Chair Mulder added that part of the Department's base was factored on this appropriation and that it would replace other funds that were not available. Representative J. Davies noted that Occupational Licensing would collect the program receipts. TOM LAWSON, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT explained that the $100 thousand dollar authorization is for excess general fund program receipts from the business licenses. There being NO OBJECTION, Amendment 12 was adopted. Co-Chair Mulder questioned if the Trade Offices would be open and funded. Mr. Lawson stated that the shortfall is close to $250 thousand dollars. None of the cuts would be reinstated. Co-Chair Therriault MOVED to ADOPT Amendment 13 (copy on file). Insert a new section: The sum of $3,600,000 is appropriated from the power cost equalization and rural electric capitalization fund (AS 42.45.100) to the Department of Community and Regional Affairs for additional expenses of operating the power cost equalization program for the fiscal year ending June 30. 2000." Representative Grussendorf explained that the amendment would allow addition money to be authorized from the fund. Co-Chair Therriault clarified that the amendment is linked to legislation that would be before the Committee on the next day. Total funding available would be brought up to the estimated amount. There being NO OBJECTION, Amendment 13 was adopted. Co-Chair Mulder Moved to Rescind the Committee's action in adopting Amendment 12. There being NO OBJECTION, it was so ordered. Co-Chair Mulder MOVED to Amend the Amendment by deleting "$100,000" and inserting "$150,000". There being NO OBJECTION, it was so ordered. Co-Chair Mulder MOVED to ADOPT Amendment 12 as amended. There being NO OBJECTION, it was so ordered. Representative Moses MOVED to ADOPT Amendment 14. Co-Chair Therriault OBJECTED. Representative Moses discussed Amendment 14. Department of Transportation and Public Facilities Add Iliamna-Nondalton $2,400,000 Highway (ED 40) Completion of the Iliamna-Nondalton Road is scheduled in the STIP for construction next summer. The State has spent approximately $600,000 in design, environmental and engineering work to date. Inclusion of at least half of the needed federal authorization will allow work to continue during the interim. The remaining authorization can then be added next year. The project may experience some delay, but could still be put out to bid in late summer or early fall of 2000. No increase in the general fund match is required by this amendment. Representative Moses explained that the appropriation was originally submitted for $4.8 million dollars. The item was taken out in the Senate. The project has been held up for several years. Representative G. Davis questioned where the general fund match would be found. Representative Moses stated that the match would come from community road funds. Co-Chair Therriault noted that it would over authorize the funds. A roll call vote was taken on the motion. IN FAVOR: Moses, Bunde, Davies, Foster, Grussendorf OPPOSED: Kohring, Williams, Austerman, Davis, Mulder, Therriault The MOTION FAILED(5-6). Representative J. Davies MOVED to ADOPT Amendment 15. Amendment 15 would add an additional $150 thousand dollars for Pioneer's Homes. A roll call vote was taken on the motion. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Therriault, Mulder The MOTION FAILED (3-8). Representative J. Davies Withdrew Amendment 16. Representative J. Davies MOVED to ADOPT Amendment 17. Insert on page 33, line 29 Statewide Library $100,000 Co-Chair Therriault noted that statewide libraries are currently funded at $90 thousand dollars. A roll call vote was taken on the motion. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Therriault, Mulder The MOTION FAILED (3-8). Representative J. Davies Amendment 18. Insert page 72, line 32 University of Alaska Fairbanks-Tanana Valley College $7 million dollars. Representative J. Davies noted that the amendment would bring funding for the Hutchinson Career Center project to its full amount. He noted that the $3 million dollars in the budget is the entire capital appropriation for the University of Alaska. There is no money for deferred maintenance or other projects. This is the number one project of the Board of Regents. In response to a question by Co-Chair Therriault, Representative J. Davies clarified that the increase would be general funds. A roll call vote was taken on the motion. IN FAVOR: Davies, Grussendorf, Moses, Therriault OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Mulder The MOTION FAILED (4-7). Representative J. Davies MOVED to ADOPT Amendment 19. Co- Chair Mulder OBJECTED. Insert page 72, line 32 University of Alaska Fairbanks-Tanana Valley College $3.5 million dollars. Representative J. Davies stated that this would bring the appropriation slightly above the Governor's request. The additional $500 thousand dollars would come from AHFC funds. Representative Grussendorf spoke in support of the amendment. A roll call vote was taken on the motion. IN FAVOR: Davies, Grussendorf, Moses, Therriault OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Mulder The MOTION FAILED (4-7). Representative J. Davies Withdrew Amendment 20 (copy on file). l11iamna: Nondallton Highway 4,845.9 FED 250. GF Representative J. Davies MOVED to ADOPT Amendment 21 amended to $3.4 million dollars. Co-Chair Mulder OBJECTED. AHFC Low Income Weatherization $3.4 million dollars Representative J. Davies spoke in support of the amendment. He pointed out that it is a statewide program. Co-Chair Therriault noted that the additional $1 million dollars would be general funds. A roll call vote was taken on the motion. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Therriault, Mulder The MOTION FAILED (3-7). Representative J. Davies MOVED to ADOPT Amendment 22 with an amended fund source of general funds. Co-Chair Therriault OBJECTED. Page 43, line 12 Add Alano Club Replacement Project $600,000 Representative J. Davies spoke in support of the amendment. A roll call vote was taken on the motion. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Therriault, Mulder The MOTION FAILED (3-8). Representative J. Davies MOVED to ADOPT Amendment 23 (copy on file). Co-Chair Mulder OBJECTED. Page 43, line 12 Add Public Health Nursing WAN/Computer upgrade $100,000 Representative J. Davies explained that the computer equipment is aged. (Tape Change, HFC 99 - 148, Side 2) A roll call vote was taken on the motion to adopt Amendment 23. IN FAVOR: Davies, Grussendorf, Moses OPPOSED: Bunde, Austerman, G. Davis, Foster, Kohring, Williams, Therriault, Mulder The MOTION FAILED (3-8). Representative Grussendorf MOVED to ADOPT Amendment 24. Co- Chair Therriault OBJECTED. Page 32, line 16 Add Maniilaq Senior Center Repairs $400,000 Representative Grussendorf spoke in support of the amendment. He gave a brief history of the Maniilaq Senior Center. A roll call vote was taken on the motion to adopt Amendment 24A. IN FAVOR: Foster, Grussendorf, Kohring, Moses, Davies OPPOSED: Williams, Austerman, Bunde, Davis, Mulder, Therriault The MOTION FAILED (5-6). Representative J. Davies MOVED to ADOPT Amendment 24 B. Co- Chair Mulder OBJECTED. Section 77, page 48, lines 19-28 Deferred Maintenance and Emergency Repairs 3,900,000 Airport Deferred Maintenance $900,000 Emergency and Non-Routine Repairs $1,000,000 Harbor Deferred Maintenance $1,000,000 Highway Deferred Maintenance $1,000,000 JOE PERKINS, COMMISSIONER, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES spoke in support of Amendment 24A. He noted that the Department of Transportation and Public Facilities items of deferred maintenance were put in the capital budget in 1988. These items are in direct support of the operating budget. He reviewed cuts to the Department of Transportation and Public Facilities. He stressed that there is still a cut of $2.1 million dollars in their operating budget. Without the amendment the Department of Transportation and Public Facilities would have a total reduction of $4.1 million dollars. Representative J. Davies pointed out that half of the funding is in the operating budget on page 48. The amendment restores the appropriation to the original amount. Representative Williams spoke in support of additional funding. He questioned how funds would be allocated. Commissioner Perkins responded that the money has already been allocated. Regions are funded by percentage, but the funding is tied to projects. He emphasized that the work will be done, but that funding would have to come out of operating funds. Representative G. Davis noted that the Department of Transportation and Public Facilities' deferred maintenance is not eligible for the deferred maintenance bonding package. He questioned where the state is on its bonding package. Co-Chair Mulder explained that the package specified particular projects. Three of the harbors were funded. He acknowledged the deferred maintenance backlog. Co-Chair Therriault explained that the intent was to be sensitive to the Alaska Housing Finance Corporation's (AHFC) participation in the bonding package. He observed that problems could be caused with the bonding counsel if current facilities are not maintained. Representative J. Davies stressed that the items that would be funded are not normally considered in the deferred maintenance package due to their size and nature. These are small ticket items such as brush and culvert clearing. Representative J. Davies MOVED to AMEND Amendment 24B to add $100 thousand dollars to each component for a total increment of $400 thousand dollars. There being NO OBJECTION, Amendment 24B was adopted as amended: Section 77, page 48, lines 19-28 Deferred Maintenance and Emergency Repairs Airport Deferred Maintenance $550,000 Emergency and Non-Routine Repairs $600,000 Harbor Deferred Maintenance $600,000 Highway Deferred Maintenance $600,000 Co-Chair Therriault MOVED to ADOPT Amendment 25 (copy on file). Ms. McConnell explained that the amendment allows lapse balances in the Governor's office to be placed in the Governor's Contingency Fund. There being NO OBJECTION, it was so ordered. Representative Williams MOVED to ADOPT Amendment 26 (copy on file). Co-Chair Mulder OBJECTED. Amendment 26 combines the National Highway System Program (NHS) Construction with the Alaska Marine Highway System NHS and Ferryboat Discretionary projects. Representative Williams explained that the amendment allows funds to be combined for greater flexibility. TOM BRIGHAM, DIRECTOR, DIVISION OF STATEWIDE PLANNING, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES explained that the two appropriations would be combined. There are no changes in projects or the dollar amount. He stressed that there may not be enough state match to cover discretionary funding under TEA-21. Representative G. Davis spoke against the amendment. A roll call vote was taken on the motion Amendment 26. IN FAVOR: Davies, Grussendorf, Moses, Foster, Williams OPPOSED: Bunde, Austerman, G. Davis, Kohring, Therriault, Mulder The MOTION FAILED (5-6). Co-Chair Therriault MOVED to ADOPT Amendment 27 (copy on file). Amendment 27 would apply any lapse in the Department of Health and Social Services toward the Medicaid match. The anticipated lapse amount in the appropriations listed in Amendment 27 is estimated at $100 to $200 thousand dollars. There being NO OBJECTION, it was so ordered. Co-Chair Therriault MOVED to ADOPT Amendment 27A. It is the intent of the Legislature that the progress of this project be reviewed on a periodic basis and that the Departments of Law, D HSS, and Administration provide a full verbal and written briefing to the House Health and Social Services budget subcommittee, which includes the Co Chair of the House Health and Social Services Committee within six months after startup of the project. Thereafter, briefings will be available upon request of the subcommittee. There being NO OBJECTION, it was so ordered. Co-Chair Therriault MOVED to ADOPT Amendment 28 (copy on file). Amendment 28 would lower the amount paid to the State Bond Committee for payment of additional principal and interest from $3,400,00 to $2,450,000 dollars. There being NO OBJECTION, it was so ordered. Representative J. Davies referred to page 11, section 28. Co-Chair Therriault explained the effective date on the Tourism Bill is delayed a year. Section 28 would fund the transition year. Co-Chair Mulder MOVED to report HCS CSSB32 (FIN) out of Committee. There being NO OBJECTION, it was so ordered. HCS CSSB 32 (FIN) was REPORTED out of Committee with a "do pass" recommendation. ADJOURNMENT The meeting adjourned at 5:46 a.m. House Finance Committee 18 5/18/99