SENATE COMMUNITY & REGIONAL AFFAIRS COMMITTEE February 23, 1993 9:02 a.m. MEMBERS PRESENT Senator Randy Phillips, Chairman Senator Robin Taylor, Vice Chairman Senator Rick Halford MEMBERS ABSENT Senator Al Adams Senator Fred Zharoff COMMITTEE CALENDAR SENATE BILL NO. 33 "An Act relating to grants for local emergency planning committees and emergency response organizations; and providing for an effective date." SENATE BILL NO. 35 "An Act providing immunity for the Alaska State Emergency Response Commission, the local emergency planning committees, the Hazardous Substance Spill Technology Review Council, and their members for official actions; and providing for an effective date." SENATE BILL NO. 88 "An Act relating to grants to municipalities, named recipients, and unincorporated communities; establishing capital project matching grant programs for municipalities and unincorporated communities; establishing a local share requirement for capital project grants to municipalities, named recipients, and unincorporated communities; and providing for an effective date." SENATE BILL NO. 89 "An Act making appropriations for capital project matching grant programs; and providing for an effective date." PREVIOUS SENATE COMMITTEE ACTION SB 33 - No previous action to record. SB 35 - No previous action to record. SB 88 - See Community & Regional Affairs minutes dated 2/16/93, 2/18/93.. SB 89 - See Community & Regional Affairs minutes dated 2/16/93, 2/18/93. WITNESS REGISTER Annette Kreitzer, Staff to Senator Loren Leman State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Offered information on SB 33 & SB 35 Michael Conway, Director Division of Spill Prevention Department of Environmental Conservation 410 Willoughby Ave., Suite 105 Juneau, AK 99801-17795 POSITION STATEMENT: Testified in support of SB 33 Jeff Morrison, Legislative Liaison Administrative & Support Services Division Department of Military & Veterans Affairs P.O. Box 110900 Juneau, AK 99811-0900 POSITION STATEMENT: Testified in support of SB 33 Marie Sansone, Assistant Attorney General Department of Law P.O. Box 110300 Juneau, AK 99811-0300 POSITION STATEMENT: Present to answer questions on SB 33 & SB 35 Jack Fargnoli, Senior Policy Analyst Office of Management & Budget P.O. Box 110020 Juneau, AK 99811-0020 POSITION STATEMENT: Offered information on SB 88 & SB 89 ACTION NARRATIVE TAPE 93-8, SIDE A Number 001 The Senate Community & Regional Affairs Committee was called to order by Chairman Randy Phillips at 9:02 a.m. CHAIRMAN RANDY PHILLIPS introduced SB 33 (GRANTS FOR LOCAL EMERGENCY PLANNING) as the first order of business. ANNETTE KREITZER, staff to Senator Loren Leman, stated Senator Leman introduced SB 33 at the requests of the Department of Environmental Conservation and the Department of Military and Veterans Affairs. She explained the legislation clarifies the granting authority for DEC and DMVA for what they are trying to do to meet their responsibilities under the Super Fund Act. It will allow DEC to award grants to form local emergency planning committees and will allow DMVA to award grants for disaster planning and response. Ms. Kreitzer directed attention to a proposed committee substitute. She said after the original bill was drafted, it was brought to the sponsor's attention that the bill didn't do exactly what these departments needed. Number 055 MICHAEL CONWAY, Director of the Division of Spill Prevention and Response, Department of Environmental Conservation, stated the department's support for the legislation. He said this will give them the opportunity to streamline their ability to do business with local emergency planning committees (LEPCs). Number 067 JEFF MORRISON, Legislative Liaison, Department of Military and Veterans Affairs, voiced the department's support for SB 33, saying it expedites their ability to administratively handle the money dealing with LEPC's. He directed attention to the draft committee substitute, noting one of the significant changes is the addition of subsection (b) in Section 1. The original legislation just addressed training grants, and the new subsection allows the LEPC's to contract for developing plans as well as training. Number 098 MARIE SANSONE, Department of Law, stated she was present to answers questions from the committee. Number 103 SENATOR TAYLOR moved that CSSB 33 (CRA) be adopted. Hearing no objection, it was so ordered. SENATOR TAYLOR moved that CSSSB 33 (CRA) be passed out of committee with individual recommendations. Hearing no objection, it was so ordered. Number 122 CHAIRMAN RANDY PHILLIPS introduced SB 35 (IMMUNITY FOR ACTIONS TAKEN UNDER AS 46.13) as the next order of business. ANNETTE KREITZER, staff to Senator Loren Leman, explained the legislation was introduced at the request of the Department of Environmental Conservation. It addresses liability of volunteers and state officials who serve on the Alaska State Emergency Response Commission, the local emergency planning committees, and the Hazardous Substance Spill Technology Spill Council. Ms. Krietzer noted that staff from the Department of Law was present to respond to questions. Number 150 SENATOR TAYLOR voiced his concern that the legislation would be granting a complete blanket of immunity for all members participating in the review of and approval of the local emergency plans, the commission that establishes it, the members of the council, or even the local emergency planning committees. At the same time, we have strict liability for damage claims against companies that have ever existed in Alaska law, and yet we are giving the people who administer it a complete blanket of immunity, he said. CHAIRMAN PHILLIPS stated SB 35 would be held until the Thursday meeting to give the committee the opportunity to take a closer look at it. CHAIRMAN PHILLIPS brought SB 88 (CAPITAL PROJECT GRANTS) and SB 89 (APPROP: CAPITAL PROJECT MATCHING GRANTS) before the committee as the next order of business. JACK FARGNOLI, Senior Policy Analyst, Office of Management and Budget, presented a brief recap on the provisions of SB 88, which is a high priority of Governor Hickel. The Governor has proposed in the appropriation bill, SB 89, a total of $67 million for funding, which, under the provisions of the appropriation bill, would be split $65.3 million for municipalities and $1.7 million for unincorporated communities. Under both of those programs, there would be matching grant provisions that are broken down by the sizes of the communities involved, such that each time a grant or part of a grant was drawn from the communities accounts that will be created, the communities would be responsible for putting up a match. The match could be in dollars or it could be in-kind. Mr. Fargnoli said the primary intent in introducing the legislation is to help encourage and maximize the influence of the local communities themselves in the identification and prioritization of their projects. The Governor would propose those projects in their same priority order in his capital budget each year, subject to the total amount of appropriations available, and then transmit those projects as part of his capital budget to the legislature for consideration. A separate provision of the bill provides that if he for any reason departs from the priority order that is identified by local communities themselves, then he would explain in writing to the legislature his reasons for doing so. Mr. Fargnoli reiterated that it is the Governor's sense that this is important both for the process is creates and the attention is gives to local priorities. Mr. Fargnoli related that Shelby Stastny, Director of the Office of Management and Budget, was unable to attend the hearing because he was in a meeting with Governor Hickel. Number 270 SENATOR TAYLOR referred to page 11, lines 3 through 11, which relates to the local share percentage. He said the population in Wrangell is very similar to Barrow and the North Slope Borough. One mill in Wrangell generates about $75,000 total, whereas one mill in the North Slope generates several million. He said the percentile is based merely upon population and totally disregards the tax base of the community and its ability to pay. He then suggested putting this on a mill equivalency basis. JACK FARGNOLI said in the earlier versions of the bill that were in the last two sessions, there was a rather elaborate set of formulas to deal with the fiscal capacity of the different communities just to capture those kinds of differences. The decision was made this year that the desirability of simplifying the bill for purposes of ease of understanding and ease of administration would outweigh those concerns. The bill was changed to a flat three-tiered structure, grouping them by population, knowing that in some cases there would be those kind of discrepancies. He added that Senator Taylor's point was well taken and he had no reason to disagree with it. Number 325 SENATOR HALFORD commented that any time we try to classify by some arbitrary standard, we run the risk of discriminating unfairly. He asked if they had considered using the same match percentage across the state. JACK FARGNOLI acknowledged that they had, and their conversations indicated pretty strongly that then you wouldn't be dealing simply with the polarities between the extreme cases, so they departed from that rather early. SENATOR HALFORD said if he were to support the bill, he thinks equity is a far better way to simplify it. He suggested it should simply say that the match initially is 10 percent and the match at the second tier is 20 percent, and leave the provisions that do provide some kind of cost of living differential and who is eligible for a match in the bill. JACK FARGNOLI responded that he thought they would be willing to make that change. Number 345 CHAIRMAN RANDY PHILLIPS stated that he was considering offering an amendment that would limit the projects for $1 million to a community. It limits that community or the non-organized area, or the organization that is doing it to 10 percent for administrative costs. JACK FARGNOLI said that they wouldn't have a problem with that change. Number 360 SENATOR TAYLOR suggested that within the percentiles that there be some significant readjustments and that it be based on a mill equivalency basis, or perhaps a combination of population and mill equivalency. He also said he was not willing to accept the Department of Community and Regional Affairs' formula. SENATOR HALFORD said that if we're trying to find a real formula that reflects ability to pay, then it has to be mill rate per capita. Number 387 CHAIRMAN RANDY PHILLIPS stated SB 88 and SB 89 would be back before the committee at the Thursday, February 25 meeting. There being no further business to come before the committee, the meeting was adjourned at 9:30 a.m.