MINUTES SENATE FINANCE COMMITTEE 7 May 1997 5:16 p.m. TAPES SFC-97, #147, Side 1 (000 - 592) 147, Side 2 (592 - 303) CALL TO ORDER Senator Bert Sharp, Co-chairman, convened the meeting at approximately 5:16 p.m. PRESENT In addition to Co-chairman Sharp, Senators Pearce, Phillips, Donley, Parnell and Adams were present when the meeting convened. Senator Torgerson arrived shortly thereafter. ALSO ATTENDING: Glenda Straube, Director, Division of Child Support Enforcement, Department of Revenue; Jim Nordlund, Director, Central Office, Division of Public Assistance, Department of Health and Social Services; Dan Branch, Assistant Attorney General, Human Services Section, Civil Division Juneau, Department of Law; Mitch Gravo, lobbyist; aides to committee members and other legislators. via teleconference: Greg Wolfe, Vice Presdient, Anchorage, Economic Development Corporation; Steve Lauper, Esq., AIDEA. SUMMARY INFORMATION Co-chair Sharp convened the evening meeting and called SB 159. CS FOR SENATE BILL NO. 159(L&C) "An Act relating to the new business incentive program." Greg Wolfe, Vice President, Anchorage Economic Development Corporation testified via teleconference from Anchorage. He explained the bill presently before the committee. The expansion and diversification would provide year-round employment. It was designed to help Alaskans compete in the market. Senator Pearce asked the packet from AEDC be passed out. Senator Adams commented on the business incentive grant for five years. He wanted to know who was responsible for repayment of monies if business ceases before five years. Mr. Wolfe responded saying that the loan or grant would be decided by AIDEA and they would be responsible for collection otherwise. Senator Adams also noted that the bill did not note a minimum or maximum amount on the loan. Mr. Wolfe reviewed briefly the standards for eligibility and noted the limits were stated in the bill. When the bill is completely put together the limits will be clearly known. Co-chair Sharp said there was no supporting statement from AIDEA as to whether they agreed with this bill or not. Mr. Wolfe said that AIDEA was aware and supported the bill. Steve Lauper, Esq., counsel for AIDEA testified via teleconference from Anchorage. He said there had been some concerns with the operation but that it had been corrected in the new CS which they supported. Senator Parnell referred to page two of the AEDC statement and commented on the feasibility study. Senator Adams asked whether fifty percent of the business cost could be recovered or not. Mr. Lauper assured that everything was done with reimbursement in mind. He said this bill was a vehicle in which to attract established businesses to Alaska. Senator Pearce asked if it would also attract business to state property. Mr. Wolfe said not necessarily. They would try to look at all conditions. The bill would help tilt in favour of Alaska. Mitch Gravo, lobbyist, was invited to join the committee. He referred to a letter from the Anchorage mayor. In response to Senator Parnell's question, Mr. Wolfe further noted the letter from the Anchorage mayor. He said it was a matter of logistics and operations. Criteria was being established. Noting the absence of Co-chair Sharp, Co-chair Pearce set aside SB 159. She then called SB 154. CS FOR SENATE BILL NO. 154(HES) "An Act relating to paternity determination and child support; relating to reporting of and access to financial or other information for child support purposes; making changes to laws relating to occupational, recreational, or other licenses, permits, certificates, or other authorizations issued by the state to facilitate administration of child support laws; relating to the interest rate on judgments or decrees for child support; relating to immunity from civil liability for good faith compliance with reporting or other requirements for child support purposes; relating to voiding fraudulent transfers and to penalties for noncompliance with orders for child support purposes; amending Rules 4, 5, 35, 52, 58, 60(b), 78, 90.1, and 90.3, Alaska Rules of Civil Procedure; amending Rule 901, Alaska Rules of Evidence; amending Rules 3 and 5, Alaska Bar Association Rules; repealing the effective date of sec. 45, ch. 107, SLA 1996; and providing for an effective date." Glenda Straube, Child Support Enforcement was invited to join the committee. She explained the HES version of the bill before the committee. It included changes in federal mandates applicable for all states. Jim Nordlund, Division of Public Assistance was invited to join the committee. He said this bill, if passed into law would result in penalties for violators. With reference to the impact on the agency, he said it would be difficult if federal funds were lost due to non-compliance. The Department of Health and Social Services supported the bill. Ms. Straube explained the bill section by section. She specifically referred to new hire reporting and said all employers must report new or re-hires within twenty days. Senator Parnell asked about section 76 on page 29, line 27. Ms. Straube said she did not know who would make the determinations. She noted that crew member fishing licenses were added in to the bill. Social security numbers must be on all documents and shared with all child support agencies. However, the information was only to be used for child support purposes. Senator Phillips asked about the right to privacy with regards to the social security number and would this be a violation of one's constitutional rights. Dan Branch, Assistant Attorney General, Department of Law was invited to join the committee. He said the social security number was protected by federal law. He would look up and provide the necessary information to the committee with regards to use of the social security number. Senator Phillips had noted that one does not have to list their social security number on documents any more. Ms. Straube continued explaining the bill. She said once established, paternity could not be rescinded after sixty days without court process. Punitive fathers could request blood tests and the Division would provide these tests. She further said all agencies must provide employment records as applicable because there could be multiple cases involving the same party. A state agency or a court order could require a participant to be employed. She cited cases where individuals were appropriately employed and now paying child support payments. The State of Alaska also respects liens from other states. The department recognized use of first class mail after all diligent methods had been exhausted to notify the individual regarding child support. There was no statute of limitations on reporting arrears to the credit bureau. Further not mandated but included in the bill was: 1. one rate of interest for the child support debt (see section 12 and 13, judgments and decrees); 2. the child support order would be corrected if based on fraudulent information. Senator Torgerson asked about section 13 (AS 25.27.025). Ms. Straube indicated she would provide requested information after research. Under section 111 she said no could withhold employment if it was known the perspective employee owed child support. It should be clearly known the individual is responsible for the child whether a court order for child support is received or not. There was miscellaneous discussion between Senator Parnell and Ms. Straube regarding enforcement of child support. She did indicate that the department could not override a court order. Further under section 111, (5), everything would automatically conform according to federal mandate. Senator Torgerson asked if passage of this bill was urgent and Ms. Straube indicated that it was. Co-chair Sharp held the bill in committee and advised that he would bring it up again on tomorrow morning's calendar. ADJOURNMENT Co-chair Sharp adjourned the session at 6:32 p.m. until tomorrow morning.