HOUSE FINANCE COMMITTEE January 25, 2002 2:47 PM TAPE HFC 02 - 16, Side A CALL TO ORDER Representative Con Bunde, Vice-Chair called the House Finance Committee meeting to order at 2:47 PM. MEMBERS PRESENT Representative Con Bunde, Vice-Chair Representative Eric Croft Representative John Davies Representative Bill Hudson Representative Ken Lancaster Representative Carl Moses MEMBERS ABSENT Representative Eldon Mulder, Co-Chair Representative Bill Williams, Co-Chair Representative Richard Foster Representative John Harris Representative Jim Whitaker ALSO PRESENT Ed Flanagan, Commissioner, Department of Labor and Workforce Development; PRESENT VIA TELECONFERENCE There were no teleconference testifiers. GENERAL SUBJECT (S): Missions and Measures: Department of Labor and Workforce Development The following overview was taken in log note format. Tapes and handouts will be on file with the House Finance Committee through the 22nd Legislative Session, contact 465- 2156. After the 22nd Legislative Session they will be available through the Legislative Library at 465-3808.   LOG SPEAKER DISCUSSION  TAPE HFC 02 - 16 DEPARTMENT OF LABOR AND WORKFORCE  SIDE A DEVELOPMENT  000 ED FLANAGAN, Discussed the Employment Security COMMISSIONER, Division. He noted that the there has DEPARTMENT OF LABOR been an increase to 34.7 percent of the AND WORKFORCE number of registered clients that are DEVELOPMENT receiving service though an Alaska Job Center. He noted that the centers are largely self-service.  Commissioner Noted that some of the federal measures Flanagan are useful but some do not reflect performance according to state needs.  19 Commissioner Provided members with a copy of their Flanagan Strategic Plan for the Employment Security Division (copy on file). The overall mission is to exceed the expectations of Alaskan employers, workers and job seekers.  34 Commissioner Reviewed the timeliness of first payments Flanagan issued within 35 days. The federal benchmark is 95 percent. They are at 97.2 percent.  52 Commissioner Referred to measures on training adult Flanagan job participants. The federal target is for 66 percent placement. They are at 60 percent. He felt that the measure could be improved. He observed that only the baseline has been established. They projected a 1 percent increase.  99 Commissioner He maintained that the measure: the Flanagan percentage of survey respondents rating the UI services adequate or higher needed to be changed.  118 Commissioner He observed that a new survey would Flanagan discover the number of employers satisfied.  150 Commissioner Reviewed measures for the Division of Flanagan Administrative Services. He observed that the number of late penalties incurred for payroll or vendor payments have been less than .1 percent or 33 - 34 out of 33,400.  164 Commissioner Observed that the average time taken from Flanagan a workers' Compensation hearing has decreased. The department intends to attempt to add an additional Citizen's Panel.  190 Vice-Chair Bunde Questioned if the results of the panels' hearings would be helpful to the subcommittee.  202 Commissioner Noted that the state is only accountable Flanagan for cases concerning state employees. The decisions are approximately 50/50.  210 Commissioner Noted that there has been progress on Flanagan Fishermen's Fund claims. Claim processing  time has been reduced from 68.7 to 23.7 days.  229 Commissioner Noted that the number of uninsured injury Flanagan cases have been decreased from 117 in FY98 to 19 in FY01. They project 15 cases in FY02.  251 Commissioner Second injury fund determination has been Flanagan reduced. He explained that insurers pay into the Fund to remove the disincentive to hire a previously injured employee. The beginning salary for injured rehired employees comes from the Fund. The money comes from insurers and penalties.  279 Commissioner Reviewed measures for the Division of Flanagan Labor Standards and Safety. He noted that lost workday injury and illness has been targeted. The number of lost workdays is difficult to account due to different definitions. Lost workday incidents are measurable; however there is a time lag on the data. They only have numbers for 1999. An additional research analyst in the OSHA program would allow them to have their own measure. He noted that the number is being reduced by approximately 3 percent a year.  322 Vice-Chair Bunde Questioned if the reduction in the logging industry was considered [as a contributing factor]. Commissioner Flanagan responded that they try to account for that in the number of incidents. More discussion ensued regarding the measure. Illness rates are per 100 full-time workers.  345 Commissioner Discussed the percentage of wage claims Flanagan settled. He observed that 50 percent of the claims are settled with a collection. Employers go out of business or leave the state in some incidences. The program is general fund supported and there is a lack of resources. He did not know the number of cases per year. He explained that many of the employers have gone bankrupt.  378 Commissioner Noted that the number of boiler and Flanagan pressure vessel inspections completed compared to the backlog has not gone beyond 65,000. He acknowledged the need to reduce the backlog. One plumbing inspector has passed qualifications to assist with boiler inspections. He stressed the importance of assuring safety. He expressed concern with  elevator inspections. There is only one inspector. There are 850 - 900 elevators with a backlog of 300 elevators. There is a plan to address the issue under legislation introduced by Representative Murkowski. The untapped revenue from backlog could pay for two positions.  422 Representative Questioned if inspections could be Hudson contracted to relieve the backlog.  429 Commissioner Noted that there are some contractors for Flanagan the large vessels, which the state certifies. The cost is greater for contracting than it would be for in-state inspectors.  431 Representative Expressed concern with the safety factor.  Hudson 439 Commissioner Noted that the economy of scale would not Flanagan allow the state to get out of the business.  441 Commissioner The wages of clients served by the Flanagan Division has increased from $17,000 in 1998 to $20,425 in FY01. The Division anticipates a 2 percent annual increase.  469 Commissioner Noted that the disability determination Flanagan service has had a backlog. The backlog has been decreased. There is not currently a measure to track this item.  489 ADJOURNMENT The meeting was adjourned at 3:30 PM