ALASKA STATE LEGISLATURE
SENATE STATE AFFAIRS STANDING COMMITTEE
February 11, 2014
9:01 a.m.
MEMBERS PRESENT
Senator Fred Dyson, Chair
Senator Cathy Giessel, Vice Chair
Senator John Coghill
Senator Bill Wielechowski
MEMBERS ABSENT
Senator Bert Stedman
COMMITTEE CALENDAR
SENATE BILL NO. 132
"An Act relating to motor vehicle registration fees."
- MOVED CSSB 132(STA) OUT OF COMMITTEE
SENATE BILL NO. 104
"An Act relating to appropriations from the dividend fund;
creating the criminal fund; and providing for an effective
date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 132
SHORT TITLE: MOTOR VEHICLE REGISTRATION FEES
SPONSOR(s): SENATOR(s) FAIRCLOUGH
01/22/14 (S) READ THE FIRST TIME - REFERRALS
01/22/14 (S) STA, FIN
02/11/14 (S) STA AT 9:00 AM BUTROVICH 205
BILL: SB 104
SHORT TITLE: APPROPRIATIONS FROM THE DIVIDEND FUND
SPONSOR(s): SENATOR(s) DYSON
01/22/14 (S) PREFILE RELEASED 1/10/14
01/22/14 (S) READ THE FIRST TIME - REFERRALS
01/22/14 (S) STA, FIN
02/06/14 (S) STA AT 9:00 AM BUTROVICH 205
02/06/14 (S) Heard & Held
02/06/14 (S) MINUTE(STA)
02/11/14 (S) STA AT 9:00 AM BUTROVICH 205
WITNESS REGISTER
SENATOR ANNA FAIRCLOUGH
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: SB 132 sponsor.
TALLY TEAL, Staff
Senator Fairclough
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided committee substitute (CS) overview
for SB 132.
JOSHUA BANKS, Staff
Senator Dyson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided a sectional analysis and CS review
for SB 104.
DAN DEBARTOLO, Director
Permanent Fund Dividend Division
Alaska Department of Revenue
Juneau, Alaska
POSITION STATEMENT: Addressed Permanent Fund Dividend (PFD)
distributions pertaining to prison inmates.
ACTION NARRATIVE
9:01:24 AM
CHAIR FRED DYSON called the Senate State Affairs Standing
Committee meeting to order at 9:01 a.m. Present at the call to
order were Senators Giessel, Coghill, and Chair Dyson.
CHAIR DYSON announced that the committee will take up SB 132
with the intention to pass the bill. He said the committee will
accept a Committee Substitute (CS). He noted that SB 132 has
little or no known opposition. He stated that the committee will
also take up SB 104 and a CS will be presented. He said SB 104
will not be passed out of today's committee meeting.
SB 132-MOTOR VEHICLE REGISTRATION FEES
9:02:26 AM
CHAIR DYSON announced that SB 132 was before the committee.
CHAIR DYSON welcomed Senator Wielechowski to the committee
meeting.
9:02:46 AM
SENATOR GIESSEL moved the CS for SB 132, labeled, 28-LS1218\N,
as the working document.
CHAIR DYSON announced that [without objection] version N is
adopted.
9:03:12 AM
SENATOR ANNA FAIRCLOUGH, Alaska State Legislature, Juneau,
Alaska, sponsor SB 132, announced that the CS before the
committee addressed clean-up language for SB 132.
She remarked about the difficulty from statutes in previous
legislative bodies for individuals turning 65 in receiving their
one-car motor vehicle benefit for registering without fee. She
detailed that an individual turning 65 after January 1 may have
to wait for their benefit for nearly two years due. She
explained that the current auto registration is for two years.
She stated that the initial legislative intent was not to have
an individual 65 or over wait 2 years. She asserted that her
intent is to fix the wrong in delaying registration benefits to
individuals who turn 65.
9:04:13 AM
TALLY TEAL, Staff, Senator Fairclough, Alaska State Legislature,
Juneau, Alaska, addressed the CS for SB 132. She said there are
three changes from the original bill. First, after discussion
with Amy Erickson from the Alaska of Administration-Division of
Motor Vehicles (DMV), a language change was made that specifies
a person must be 65 at the time of registration to be eligible
for the exemption. She explained that DMV was concerned about
any confusion about the possibility of having to refund fees for
someone who had registered at age 64 earlier in the year and
would turn 65 with an expectation for a refund. Second, at the
request of the DMV, an effective date will for the bill will be
January 1, 2015 in order to keep records and accounting as clean
as possible. Third, language was added to the title to make it
specific to vehicle registration fee exemptions for seniors.
CHAIR DYSON asked to clarify that if a person turns 65 after
they registered their vehicle, the individual has to wait the
two years.
MS. TEAL [indicated "yes" with a gesture.]
CHAIR GIESSEL asked to confirm that the fiscal note is zero.
MS. TEAL answered yes.
SENATOR FAIRCLOUGH pointed out that the fiscal note is
indeterminate. She said DMV thinks the fiscal note will be very
minimal and the effect will be a very small amount.
CHAIR DYSON asked if anyone wanted to testify. He noted that no
one requested to testify. He announced that the Chair will
entertain a motion.
9:06:52 AM
SENATOR GIESSEL SENATOR moved to report CS for SB 132, version
28-LS1218\N from committee with individual recommendations and
attached zero fiscal note.
9:07:06 AM
CHAIR DYSON announced that seeing no objection, CSSB 132(STA)
passes from committee.
9:07:12 AM
CHAIR DYSON announced the committee will stand at ease.
9:08:30 AM
CHAIR DYSON called the committee back to order.
SB 104-APPROPRIATIONS FROM THE DIVIDEND FUND
9:08:39 AM
CHAIR DYSON announced that SB 104 is before the committee. He
noted that SB 104 was introduced the previous week and some
discussion occurred. He revealed that Mr. Banks has worked with
two or three different state executive branch personnel and
excellent suggestions were received. He set forth that the
intent is to incorporate the suggestions into the bill. He
stated that the purpose at today's meeting is to discuss the
changes with the intent to act on SB 104 at the following
meeting.
9:09:36 AM
JOSHUA BANKS, Staff, Senator Dyson, Alaska State Legislature,
Juneau, Alaska, explained that SB 104's four major goals are as
follows:
1. Restore crime victims to pre-offense condition.
2. Establish a reliable funding source for the Violent
Crimes Compensation Board (VCCB).
3. Sets a priority for the use of the Criminal Fund (CF).
4. Uses a "vehicle" for compensation that already exists
in statute.
MR. BANKS explained the sectional analysis for SB 104 as
follows:
Section 1, subparagraph (A) makes the language for the
legislative intent for taking away a felon or certain
misdemeanants' Permanent Fund Dividend (PFD) uniform
with our priority order set in SB 104.
Section 1, subparagraph (B) would ensure that money
from ineligible individuals' PFDs goes into CF before
it is spent. The purpose of this language change was
to make sure that there wasn't an end-run to avoid
giving money to victims.
Section 2, subsection (a), this section in total gives
direction on how to spend the CF; it is a new section
that would create AS 43.23. Subsection (a) creates a
priority order for how the CF should be appropriated.
9:11:42 AM
He continued to address the sectional analysis as follows:
The priority order that we are setting is:
1. The Violent Crimes Compensation Board to make
payments for victims.
2. The Child Support Services Division to pay
child support arrearages owed by incarcerated
individuals.
3. State approved court-ordered drug or alcohol
rehabilitation costs.
4. The Department of Corrections for other
incarceration costs.
Subsection (b), the VCCB will give a report to the
Department of Revenue (DOR) showing the amount of
compensable claims that could have been given to
victims and the amount that would have been needed to
pay the first amount. The reason why we have two
amounts in this section is if they didn't have enough
money in the previous year, they can request what is
needed. Also, in the case in the future, if they end
up not granting the money that was appropriated in the
previous year, they will just need to ask for what
they need.
Subsection (c), the Child Support Services Division
(CSSD) will send the amounts of child support
arrearages owed by incarcerated individuals to the
DOR.
Subsection (d) will have the court system report on
how much they need to operate drug and alcohol
rehabilitation programs.
Subsection (e) will have DOR look at the reports given
in sections (b), (c), and (d), and determine how much
each agency should receive from the CF based on the
priority set in subsection (a).
9:13:28 AM
SENATOR COGHILL noted Section 2 and asked if the CF was placed
at the top of the list and the rest of the list stayed the same.
MR. BANKS replied that the current statute does not have a
priority order. He added that the priority list is based upon
the Governor and legislature as to who should receive funds.
CHAIR DYSON informed the committee that SB 104's primary intent
is to specify victims as the first priority. He noted in
previous legislation it was assumed that victims were listed
first.
SENATOR COGHILL asked to clarify that penalties for court-
ordered drug and alcohol treatment will be tallied and assessed
rather than the actual cost for treatment.
MR. BANKS replied that the court system does not have records
for treatment program costs. He said the intent to have the
Department of Corrections (DOC) report treatment program costs.
9:15:20 AM
CHAIR DYSON explained that there are two groups who kind of get
money for victims to propitiate them: DOL for court-ordered
adjudication and VCCB. He specified that DOL cannot begin their
work until final adjudication and the process can take months or
years. He said VCCB can begin immediate recompense for victims.
He asserted that SB 104 does not touch DOL's court system
orders.
MR. BANKS continued the sectional analysis as follows:
Subsection (f) will have DOR submit a legislative
report listing the amounts that should go to each
agency; this is going to be done when the operating
budget is submitted to the legislature.
Section 3 establishes the CF in statute. Currently
there is no statutory reference to the PFD-CF; it is
really only in existence for accounting purposes. We
felt that it was needed so that all PFDs from
ineligible individuals can statutorily be tracked and
specify that it is going into the CF. The last
sentence in Section 3, page 4, line 28, you will see
that nothing in this section creates a dedicated fund
and the purpose of that is to avoid misconstruing that
this fund is creating a dedicated fund. In Article IX,
Section 7 of the Alaska Constitution; it prohibits the
dedication of funds to a specific purpose. The Alaska
Supreme Court did a good precedent case on Sonneman v.
Hickel, which dealt with the Alaska Marine Highway
System Fund. The court said that even though the money
automatically goes into the Marine Highway Fund
through revenue received from the Marine Highway,
because the legislature is not forced by law to spend
that money in the fund on the Marine Highway, it does
not violate the dedicated funds clause. So we worked
with Legislative Legal to make the language in the CF
very similar to the Marine Highway Fund so that we can
avoid the dedicated funds clause.
SENATOR COGHILL asked to clarify that anything in the CF can be
appropriated by the legislature for any purpose.
MR. BANKS answered yes.
9:18:41 AM
He continued the sectional analysis on Section 4 as follows:
In paragraph 6 we are giving DOR additional regulatory
authority to implement AS 43.23.031, which is Section
2 of our bill. Page 6, subsection 11 will allow DOR to
use the list ineligible individuals provided by DOC to
determine how much child support arrearages are owed
by these individuals.
CHAIR DYSON noted that original intent was to have victims paid
50 percent from the CF and 50 percent from the Victims
Compensation Fund. He explained that SB 104 allows VCCB to do
what is appropriate for the victim and the perpetrator will be
on the hook to repay what the perpetrator is able to do. He
remarked that it was his own experience with criminal activity
that as part of the criminal's rehabilitation and or restoration
that many individuals do what they can for restoring the victim.
9:20:41 AM
MR. BANKS summarized the sectional analysis as follows:
Section 5 will set an effective date for July 1, 2014.
SENATOR COGHILL asked if an inmate has to apply for a PFD and
can an inmate be forced to apply for a PFD.
MR. BANKS replied no. He specified that inmates are ineligible
to receive a PFD. He said the state has a quasi-garnishment
process where an inmate's PFD is taken away and put into the CF.
SENATOR COGHILL asked to clarify that an inmate is an Alaskan
resident and the PFD is a transactional question whether they
apply or not with the state getting the PFD for correctional
costs.
CHAIR DYSON added that fund distribution will be dictated by the
set priorities.
9:22:08 AM
SENATOR WIELECHOWSKI asked if inmates housed outside of Alaska
were still considered Alaska residents.
MR. BANKS responded that he did not know.
9:23:11 AM
DAN DEBARTOLO, Director, Permanent Fund Dividend Division
(PFDD), Alaska Department of Revenue, Juneau, Alaska, responded
that PFDD receives information from DOC and the Department of
Public Safety (DPS) strictly for instate individuals. He
explained that PFDD is not making the assumption for individuals
who are out of state. He asserted that out of state individuals
would not be counted.
SENATOR WIELECHOWSKI asked to clarify that an inmate housed
outside of the state does not meet any of the requirements or
exceptions to receive a PFD.
MR. DEBARTOLO clarified that PFDD never puts an application
through on behalf of inmates. PFDD receives a list of
individuals that meet the criteria in the statute whether or not
they are a felon or misdemeanant, whether they were sentenced or
incarcerated. He said since PFDD does not receive an actual
application, the assumption is made that the individual would
have applied for a PFD had the individual not been in one of
those particular situations. He explained that PFDD does not
know where sentenced inmates are incarcerated.
CHAIR DYSON asserted that bringing the prisoners home has a
collateral benefit.
9:25:50 AM
CHAIR DYSON announced that SB 104 will be held in committee and
asked Mr. Banks to review the CS for SB 104.
MR. BANKS said the CS for SB 104 changes the following:
The first change that we are looking at making is in
Section 1, page 2, line 20: after "victims," we would
like to add "and operating costs of the Violent Crimes
Compensation Board;" the purpose of this is to allow
VCCB to continue using the CF to fund their operating
costs. Currently the money that they get from the CF
goes towards compensation of victims as well as the
operating costs.
CHAIR DYSON asked if the change just puts in statute that which
is already the practice.
MR. BANKS answered yes.
9:27:28 AM
MR. BANKS continued to address the CS for SB 104 as follows:
On page 3, line 14: we are doing the same thing,
adding operating costs to the VCCB.
At the end of page 3 and the first line of page 4: we
are deleting Subsection 1 and putting in the language
"to the Crime Victim Compensation Fund established
under AS 18.67.162 for payments to crime victims and
operating costs of the Violent Crimes Compensation
Board." This will just mirror the language that is
currently used to allow the VCCB to receive money from
the CF.
On page 4, line 2: after "arrearages," we would add
the words "owed by incarcerated individuals with minor
children;" the purpose of this is to put a time limit
on how much money from the CF will go to pay child
support arrearages. You will have offenders that have
life sentences and when they start they have a three
year old child, but 15 years later they are not a
minor child anymore and so not in need of child
support at that point.
On page 4, line 3: we will be deleting "to a state
approved rehabilitation program," and substitute that
for "to the Department of Corrections."
CHAIR DYSON asked what the previously noted change accomplishes.
MR. BANKS answered that the court system does not track drug
rehabilitation costs and DOC will report drug rehabilitation
costs.
9:29:38 AM
He continued the address the CS as follows:
Page 4, line 9: add "and operating cost of the Violent
Crimes Compensation Board" at the end of line 9.
Page 4, line 12: after "individuals," add "with minor
children;" again, to put in that time limit.
CHAIR DYSON asked if the previous change is a change in policy.
He specified that placing "with minor children" does not change
what the policy is, just puts it in statute.
MR. BANKS answered correct. He explained that minor children
currently receive child support and do not receive support when
they are no longer a minor.
He continued to address the CS as follows:
Page 4, line 13: we are deleting "court system" and
replacing that with "Department of Corrections."
CHAIR DYSON set forth the following to the committee:
I want it clearly on the record that my intention that
the funds that will be available for crime victims
will go back and catch up on arrearages and what is
due to them. It's not just this year's victims and
this year's court ordered restitution, it is to go
back and catch up on what they were ruled to get. If I
didn't say it before, DOC realizes they are going to
take a decrement in their budget from these funds, but
indeed with the PFD going up and the prison population
significantly increasing; there may not be a huge hit.
The other thing is, under the Affordable Care Act, DOC
can now get reimbursement from Medicaid; so that will
be additional funds that will backfill from these
funds that won't be going to prisoner healthcare.
9:32:57 AM
SENATOR COGHILL asked to clarify that the change allows the flow
of money into a fund that will go into a program to help
victims. He noted that the Department of Law (DOL) is still
proceeding with court ordered claims that are owed and asked how
DOL's claims collections works with the victim's funds. He asked
to clarify that DOL is going to go after restitution and that
money flows in a different way.
MR. BANKS relied that DOL's statutes will not be changed. He
specified that DOL will continue to seek court-ordered
restitution. He specified that SB 104 will allow money to go to
VCCB, a fund that is different than restitution. He explained
that VCCB can give a "grant" to a victim before there is a
conviction.
SENATOR COGHILL remarked that he did not want the legislature to
relax on restitution. He asserted that the victim's restitution
avenue be held firm. He said the DOL budget must include the
necessary tools for restitution.
9:34:31 AM
CHAIR DYSON added that DOL's Collection Department has
accelerated and intensified their efforts. He noted that DOL's
Collection Department is getting two or three times the amount
of restitution versus two years ago. He noted his appreciation
that the Governor and the Administration have shown a
significant amount of enthusiasm for getting after victims'
restitution. He remarked that the affected departments have been
supportive.
CHAIR DYSON announced that the intent is to move the bill at the
next committee meeting, [SB 104 is held in committee]. He asked
if anyone in the room or online would like to testify.
9:36:00 AM
CHAIR DYSON closed public testimony.
9:36:06 AM
There being no further business to come before the committee,
Chair Dyson adjourned the Senate State Affairs Committee at 9:36
a.m.