SENATE FINANCE COMMITTEE SECOND SPECIAL SESSION May 30, 2015 1:14 p.m. [Note: The meeting was held in Anchorage, Alaska at the Anchorage Legislative Information Office] 1:14:12 PM CALL TO ORDER Co-Chair Kelly called the Senate Finance Committee meeting to order at 1:14 p.m. MEMBERS PRESENT Senator Anna MacKinnon, Co-Chair Senator Pete Kelly, Co-Chair Senator Peter Micciche, Vice-Chair Senator Click Bishop Senator Mike Dunleavy Senator Lyman Hoffman Senator Donny Olson MEMBERS ABSENT None ALSO PRESENT James Armstrong, Staff, Senator Pete Kelly; David Teal, Director, Legislative Finance Division. SUMMARY SB 2001 APPROP: OPERATING BUDGET/LOANS/FUNDS SB 2001 was SCHEDULED but not HEARD. CSHB 2001(FIN)am APPROP: OPERATING BUDGET/LOANS/FUNDS CSHB 2001(FIN)am was HEARD and HELD in committee for further consideration. CS FOR HOUSE BILL NO. 2001(FIN) am "An Act making appropriations for the operating and loan program expenses of state government and for certain programs; making appropriations for the operating expenses of the state's integrated comprehensive mental health program; capitalizing funds and repealing appropriations; making 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." 1:14:47 PM JAMES ARMSTRONG, STAFF, SENATOR PETE KELLY, stated the bill would fully-fund the K-12 foundation formula, at roughly $16.5 million for than HB 72. The bargaining units were restored and funded. He stated that page 64 approved the language, and Sections 4 through 6 listed the funding sources. The draft had a provision for pay increases for non-covered employees contingent on the governor's veto of HB 176, which was $11.8 million. There was an unallocated reduction on page 25, lines 24 through 25 of $29.8 million that corresponded with the covered and non-covered increases. If a supermajority vote was not obtained then K- 12 foundation funds would be prorated at the same level in HB 72; all of the bargaining units would be rejected, and the cost of living pay increases would not be funded; and there would be an unallocated reduction of $9.8 million. He explained that there was an amendment that added $15 million in CBR funds for the following items: $700,000 for Parents as Teachers; $2 million Pre-K grants; $2.5 million for Office of Children's Services (OCS) front-line social workers; $2.8 million for the senior benefits program; $1.750 million for the Alaska Marine Highway System; $5 million for the University of Alaska; and $250,000 for public broadcasting. The amendment also added $681,700 in federal funds, and limited the FY 15 CBR access to a maximum of $500 million. Co-Chair Kelly remarked that the governor did not have a fully-funded budget, which was the reason for the current special session. He wondered if the current bill was a fully-funded budget. 1:18:17 PM DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION, replied that the current version did not fully fund the budget. The FY 16 supermajority vote gave access to $15 million, and was the maximum that could be withdrawn from the CBR. Co-Chair Kelly wondered what was needed from the savings account to fully fund the budget. Mr. Teal replied that approximately $3 billion was required to fully fund the budget. Co-Chair Kelly stated that the budget was $3 billion, and only $15 million would be available. 1:19:05 PM RECESSED ADJOURNMENT 4:49:22 PM The meeting was adjourned at 4:49 p.m.