Legislature(1995 - 1996)

03/27/1996 01:50 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  HOUSE BILL 412                                                               
                                                                               
       "An  Act making  appropriations for  the operating  and                 
       loan  program expenses of state government, for certain                 
       programs,    and    to    capitalize   funds;    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."                     
                                                                               
  HOUSE BILL 413                                                               
                                                                               
       "An  Act   making  appropriations  for   the  operating                 
       expenses of the state's integrated comprehensive mental                 
       health program; and providing for an effective date."                   
                                                                               
  DEPARTMENT OF EDUCATION (DOE)                                                
                                                                               
  Representative Navarre MOVED to adopt amendment DOE #6 which                 
  would eliminate the  Governor's proposed  FY97 reduction  of                 
  $100 thousand  dollars and restore community schools funding                 
  for the FY96 authorized level of $600 thousand dollars.  Co-                 
  Chair Hanley OBJECTED.                                                       
                                                                               
  A roll call was taken on the MOTION to adopt DOE #6.                         
                                                                               
       IN FAVOR:      Grussendorf, Navarre, Brown.                             
       OPPOSED:       Kelly, Kohring, Martin, Mulder, Parnell,                 
                      Therriault, Foster, Hanley.                              
                                                                               
                                                                               
                                4                                              
                                                                               
                                                                               
  The MOTION FAILED (3-8).                                                     
                                                                               
  Representative Brown MOVED  to adopt amendment DOE  #8 which                 
  would fund pupil transportation at the foundation  projected                 
  level for FY97.   The amendment would add a little more than                 
  $3 million dollars to the budget.  Co-Chair Hanley OBJECTED.                 
                                                                               
  LARRY  WIGET, DIRECTOR  OF  GOVERNMENT RELATIONS,  ANCHORAGE                 
  SCHOOL DISTRICT, ANCHORAGE, stated that Representative Brown                 
  had  accurately  reflected  the concerns  of  the  Anchorage                 
  school  district   regarding  pupil  transportation.     The                 
  Governor's proposed budget would  force the Anchorage school                 
  district to cut from the budget an additional $1.57  million                 
  dollars.  The funding that is currently proposed in the bill                 
  includes an  8% cut  without taking  into consideration  the                 
  opening  of  new schools,  new  routes and  a cost-of-living                 
  raise.                                                                       
                                                                               
  A roll  call was taken on the  MOTION to adopt amendment DOE                 
                                                                               
       IN FAVOR:      Brown, Grussendorf.                                      
       OPPOSED:       Kelly, Kohring, Martin, Mulder, Parnell,                 
                      Therriault, Hanley, Foster.                              
                                                                               
  Representative Navarre was not present for the vote.                         
                                                                               
  The MOTION FAILED (2-8).                                                     
                                                                               
  Representative Mulder MOVED to report CS HB 230 (FIN) out of                 
  Committee with  individual recommendations.  There  being NO                 
  OBJECTION, it was so ordered.                                                
                                                                               
  CS HB 230  (FIN) was reported  out of  Committee with a  "do                 
  pass" recommendation.                                                        
                                                                               
  DEPARTMENT OF PUBLIC SAFETY (DPS)                                            
                                                                               
  Co-Chair Hanley explained that a program exists which allows                 
  the  State  to  use  felon  dividends  for  three  different                 
  programs, the  Department  of  Corrections,  Violent  Crimes                 
  Compensation   Commission  and   the  Council   on  Domestic                 
  Violence.  In years past, most of the money in those budgets                 
  had  been  from   Permanent  Fund  Dividends  (PFD).     The                 
  Governor's FY97  proposed budget had $3.196  million dollars                 
  of PFD money going to those three divisions.   Last year, it                 
  was  $2.8  million  dollars.    Co-Chair Hanley  noted  that                 
  information  was   now  available  indicating   that  amount                 
  available this year would be closer to $2.4 million dollars.                 
  He   asked   for   further   information   regarding    that                 
  determination.                                                               
                                                                               
                                                                               
                                5                                              
                                                                               
                                                                               
  NANCI  JONES,  DIRECTOR, PERMANENT  FUND  DIVIDEND DIVISION,                 
  DEPARTMENT OF REVENUE, advised that the model currently used                 
  has  been  in  existence  since  1988.   The  Department  of                 
  Corrections provides a tape each year of those felons listed                 
  as incarcerated for  that particular  qualifying year.   For                 
  FY97, the number would be determined by the felons that were                 
  incarcerated in the  1994 calendar  year, in the  qualifying                 
  year  for the  1995 PFD.   The tape  match is  compared with                 
  those persons who would be eligible for a dividend and would                 
  not  have  any  prior  denials  on  the record.    The  edit                 
  determines if they  had applied for  a dividend in any  year                 
  from 1988 - 1994.   Each year, an additional year  is added.                 
  If they are eligible, then their  dividend is eligible to be                 
  paid  for  the  appropriation.   Elimination  of  new people                 
  occurs if  they have never applied for a dividend.  A number                 
  is  then  determined  and multiplied  by  the  total of  the                 
  dividend.    The  amount  of  the  1995  dividends was  $990                 
  dollars, which totalled $2.438 million dollars available for                 
  appropriation.                                                               
                                                                               
  Ms. Jones continued, according to  statute, if an amount  is                 
  appropriated over and above that number, then the detail  of                 
  that appropriation  needs to be listed on the dividend stub.                 
  Currently, that amount  would roll  forward with the  amount                 
  remaining  in  the  fund  and  appears  as  a  prior  period                 
  adjustment.                                                                  
                                                                               
  Representative Brown stated  that if the  over-appropriation                 
  was not corrected, would that money then be taken out of the                 
  current year dividend pool.   Ms. Jones noted that  would be                 
  correct for the dividends to be paid for 1997.                               
                                                                               
  Representative Brown asked for further information regarding                 
  the drop-in felons  for whom the  dividends would be  coming                 
  into the  pool for calendar  year 1993 and 1994.   Ms. Jones                 
  established that the discrepancy resulted in FY96 when there                 
  were many names provided from  the Department of Corrections                 
  as  felons who  were in  fact not  yet incarcerated  felons.                 
  That number  then needs  to be  adjusted for  the amount  of                 
  dividends to be  paid.   The number that  year totalled  400                 
  felons who appealed and who the State had to pay  a dividend                 
  to.  In order for the State not to be required to pay twice,                 
  an adjusted number was provided.                                             
                                                                               
  Representative Mulder questioned how that could happen.  Ms.                 
  Jones pointed out that there could be a lag in the reporting                 
  time.  The  prisoner could be arrested,  spending over night                 
  in jail, but then not convicted of that crime.  Depending on                 
  when the tapes are  made available, there could be no way of                 
  knowing until the dividend was not paid.  In the last fiscal                 
  year, there were 168 dividends  overturned.  The 1996 number                 
  is correct.  The run is normally done in March of each year.                 
                                                                               
                                6                                              
                                                                               
                                                                               
  This  oversight could result in  a $1.10 dollar reduction to                 
  the PFD's this year.                                                         
                                                                               
  NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF                 
  MANAGEMENT  AND BUDGET,  OFFICE OF  THE GOVERNOR,  explained                 
  that the calculations were provided to the Governor's Office                 
  recently, after the amendments had been completed.  A review                 
  has  not  been  provided  to  determine  how  to  bring  the                 
  discrepancy  in  line  with  the  amount which  is  actually                 
  available.                                                                   
                                                                               
  Representative  Mulder  questioned   if  the  Department  of                 
  Corrections had  given incorrect  information regarding  the                 
  status  of  eligibility.     Ms.  Jones  replied   that  the                 
  information available at the time,  needed to be adjusted in                 
  a manner so that the PFD  can make the necessary calculation                 
  changes.    At the  time  that  the tape  was  provided, the                 
  Department  submitted their best  guess.  She  noted for the                 
  record  that the  Department supplied  the only  information                 
  that was available to them at that time.  Numbers need to be                 
  continually adjusted.                                                        
                                                                               
  (Tape Change, HFC 96-97, Side 2).                                            
                                                                               
  Co-Chair  Hanley  suggested that  the  Committee work  out a                 
  solution to  funding the different compensation  for victims                 
  and their family programs.  He requested that a spread sheet                 
  addressing these concerns by provided.  Representative Brown                 
  stressed that the Council on Domestic Violence should not be                 
  shorted as a result of the PFD mis-calculation.                              
                                                                               
  Co-Chair Hanley stated  that DPS #5 and DPS #6 would be HELD                 
  until the spread sheet material was available.                               
                                                                               
  Representative  Brown MOVED to adopt DPS  #4 which would add                 
  program receipt authority  of $50  thousand dollars for  the                 
  Department  of  Public  Safety  for  the Division  of  Motor                 
  Vehicles.   Co-Chair Foster OBJECTED.   Representative Brown                 
  noted that this was a new program approved by LB&A this year                 
  which allows  emissions testing  centers to  do registration                 
  renewals.                                                                    
                                                                               
  KENNETH  BISCHOFF,  DIRECTOR,  DIVISION   OF  ADMINISTRATIVE                 
  SERVICES,  DEPARTMENT OF PUBLIC  SAFETY, confirmed  that the                 
  request would  be funded  through program  receipts although                 
  would  be  considered general  fund  money.   Currently, the                 
  sign-up rate  does not  indicate an  excess of  $50 thousand                 
  dollars.  The agency feels that they can "live" with the $50                 
  thousand  dollar  limit.    Representative  Brown  MOVED  TO                 
  WITHDRAW  the  MOTION  to adopt  DPS  #4.    There being  NO                 
  OBJECTION, it was withdrawn.                                                 
                                                                               
                                                                               
                                7                                              
                                                                               
                                                                               
  DEPARTMENT OF ENVIRONMENTAL CONSERVATION (DEC)                               
                                                                               
  Representative   Therriault   MOVED   to   adopt   DEC   #1.                 
  Representative  Brown  requested   a  further   explanation.                 
  Representative Therriault explained  that due to a  delay of                 
  the approval of the  switch within the Clean Air  Program by                 
  the Environmental Protection Agency (EPA),  there would be a                 
  brief  period of  time  that fees  will be  assessed without                 
  funding.   Originally, the  Department requested  six months                 
  worth of general fund program receipts.  The amendment would                 
  provide authorization for three months with anticipation  of                 
  the transfer of the  program on October 1, 1996  rather than                 
  January 1, 1997.                                                             
                                                                               
  KURT FREDRIKSSON, ACTING  DEPUTY COMMISSIONER, DEPARTMENT OF                 
  ENVIRONMENTAL CONSERVATION,  stated that  total funding  for                 
  the program was  for $2.1  million dollars.   Representative                 
  Therriault pointed out that the  amendment would only change                 
  the source of  the funds.   The fees will  come through  the                 
  Clean Air Fund rather than the general fund.                                 
                                                                               
  BARBARA FRANK,  BUDGET OFFICER,  DIVISION OF  ADMINISTRATIVE                 
  SERVICES,   DEPARTMENT   OF    ENVIRONMENTAL   CONSERVATION,                 
  reiterated  that the  Governor's  proposed  budget was  $2.1                 
  million dollars for FY97.  The  initial request was for $2.1                 
  million  in  the Clean  Air  Fund.   DEC  then  submitted an                 
  amendment  to  convert $1  million  dollars to  general fund                 
  program  receipts.   There  is  no  change in  the  level of                 
  funding, only the funding source.                                            
                                                                               
  There being NO OBJECTION, DEC #1 was adopted.                                
                                                                               
  Representative Brown MOVED to adopt  DEC #2.  Representative                 
  Therriault  OBJECTED.  Representative Brown advised that DEC                 
  Level Waste  Radiation Compact.   There  are three  approved                 
  sites  in  the United  States.    If  participation  is  not                 
  continued, the users in Alaska will  not be able to continue                 
  use  of the site  located in Washington  State for disposal.                 
  Mr.  Fredriksson  commented that  hospitals  could privately                 
  contract with that facility.  Representative Brown explained                 
  that there would  be large  implications resulting from  the                 
  State not dealing with hazardous waste storage arrangements.                 
                                                                               
  A roll call was taken on the MOTION.                                         
                                                                               
       IN FAVOR:      Parnell, Brown, Grussendorf.                             
       OPPOSED:       Kohring,  Martin,   Mulder,  Therriault,                 
                      Kelly, Foster.                                           
                                                                               
  Representatives Hanley and Navarre were  not present for the                 
  vote.                                                                        
                                                                               
                                8                                              
                                                                               
                                                                               
  The MOTION FAILED (3-6).                                                     
                                                                               
  Representative Brown MOVED to adopt  DEC #3.  Representative                 
  Therriault OBJECTED.  Representative Brown noted that DEC #3                 
  would restore the money that  the Governor requested for the                 
  vehicle inspection program  which passed last session  as SB                 
  28.  Without funding the request, the software  to implement                 
  the program will not be installed.   Last year's fiscal note                 
  was  not adequately  funded to  accomplish the  task  of the                 
  legislation.                                                                 
                                                                               
  A roll call was taken on the MOTION.                                         
                                                                               
       IN FAVOR:      Brown, Grussendorf.                                      
       OPPOSED:       Martin,  Mulder,  Parnell,   Therriault,                 
                      Kelly, Kohring, Foster.                                  
                                                                               
  Representatives Navarre and Hanley were  not present for the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative Brown MOVED to adopt  DEC #4.  Representative                 
  Therriault OBJECTED.   Representative Brown  advised that if                 
  the  reduction   in  this  component  continues,   it  would                 
  eliminate a major  portion of sewage management  with regard                 
  to subdivision review  activities.   The action will  affect                 
  approximately one  thousand subdivisions in the Kenai, Matsu                 
  and Anchorage  areas.   Property values  could be  affected.                 
  She stressed that  it would be  more cost effective to  deal                 
  with  the  issues  before  the  building  begins  and  urged                 
  Committee members not to do away with that function.                         
                                                                               
  Representative Brown continued, it would  not be possible to                 
  pass  the  responsibility  to the  municipalities  until the                 
  program is self sustaining.   The funds need to  be provided                 
  because they affect public health which is the core function                 
  of the State.  Representative Brown  asked to change the BRU                 
  from Air  and Water  to  Statewide Public  Services.   There                 
  being NO OBJECTION, the BRU was changed.                                     
                                                                               
  Representative  Therriault  responded   that  $1.5   million                 
  dollars had been restored to Statewide Public Services.  Mr.                 
  Fredriksson remarked  that "sewage  on the  ground" was  the                 
  worst  situation.    Initially  in  creating  a subdivision,                 
  checks are made regarding the  carrying capacity of the land                 
  piece to address  a specific  load.  Representative  Navarre                 
  questioned information used in bank financing determinations                 
  for building  codes.  Mr. Fredriksson replied that the focus                 
  of  a  financial   lending  institution  would  be   on  the                 
  individual lot and  system review.  Subdivision  reviews can                 
                                                                               
                                9                                              
                                                                               
                                                                               
  have a large effect  on what the individual lot  system will                 
  look like.                                                                   
                                                                               
  Representative Therriault stated  that the Department  would                 
  like to devest itself of this entire function, although, the                 
  municipalities    are   reluctant    to   take    on   those                 
  responsibilities.                                                            
                                                                               
  A roll call was taken on the MOTION.                                         
                                                                               
       IN FAVOR:      Brown, Grussendorf.                                      
       OPPOSED:       Mulder,  Navarre,  Parnell,  Therriault,                 
                      Martin, Foster.                                          
                                                                               
  Representatives Kelly, Kohring and  Hanley were not  present                 
  for the vote.                                                                
                                                                               
  The MOTION FAILED (2-6).                                                     
                                                                               
  Representative Therriault requested that DEC  #5 be HELD for                 
  further consideration.                                                       
                                                                               
  Representative Navarre requested that DEC #6 be HELD.                        
                                                                               
  (Tape Change, HFC 96-98, Side 1).                                            
                                                                               
  Representative   Grussendorf   MOVED   to  adopt   DEC   #7.                 
  Representative Mulder OBJECTED.   Representative Grussendorf                 
  stated that the  amendment would provide for  one additional                 
  seafood inspector.  Currently, there is a "glut" of fish and                 
  any problems will reflect seriously on the market.                           
                                                                               
  Representative  Navarre  maintained  that  one  incident  of                 
  contamination would taint the entire  fishing industry.  Mr.                 
  Fredriksson suggested that  fees should  be charged for  the                 
  service.  Representative  Martin interjected that government                 
  should not be involved in the process.  The seafood industry                 
  should hire  inspectors.  Representative  Therriault pointed                 
  out that component had $2.7 million dollars remaining.                       
                                                                               
  A roll call was taken on the MOTION to adopt DEC #7.                         
                                                                               
       IN FAVOR:      Navarre, Grussendorf.                                    
       OPPOSED:       Parnell,  Therriault,   Kelly,  Kohring,                 
                      Martin, Mulder, Foster.                                  
                                                                               
  Representatives Hanley and  Brown were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  LEGISLATURE                                                                  
                                                                               
                               10                                              
                                                                               
                                                                               
  Representative   Navarre    MOVED   to    adopt   LEG    #2.                 
  Representative  Mulder  OBJECTED.    Representative  Navarre                 
  advised that the amendment would reduce a per diem  increase                 
  for  legislators  and  would  allocate  that amount  to  the                 
  University of Alaska budget.                                                 
                                                                               
  A roll call was taken on the MOTION.                                         
                                                                               
       IN FAVOR:      Grussendorf, Navarre.                                    
       OPPOSED:       Parnell,  Therriault,   Kelly,  Kohring,                 
                      Martin, Mulder, Hanley.                                  
                                                                               
  Representatives Foster and  Brown were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative   Navarre    MOVED   to    adopt   LEG    #3.                 
  Representative  Kelly  OBJECTED.     Representative  Navarre                 
  advised that the amendment had been offered in an attempt to                 
  close the budget  gap by having the  Legislature participate                 
  in "doing  its part".  Representative Kelly pointed out that                 
  the increase was granted through the 18th Legislature.                       
                                                                               
  A roll call was taken on the MOTION.                                         
                                                                               
       IN FAVOR:      Grussendorf, Navarre.                                    
       OPPOSED:       Therriault,   Kelly,  Kohring,   Martin,                 
                      Mulder, Parnell, Hanley, Foster.                         
                                                                               
  Representative Brown was not present for the vote.                           
                                                                               
  The MOTION FAILED (2-8).                                                     
                                                                               
  OFFICE OF THE GOVERNOR                                                       
                                                                               
  Representative  Grussendorf  MOVED  to adopt  GOV  #1.   The                 
  amendment would partially restore funding to the  Governor's                 
  recommendation from below cap underage.   Some reduction was                 
  merited as a result  of a court decision against  the closed                 
  primary election need  to produce  two separate ballots  and                 
  additional  training.    The   Division  of  Elections   has                 
  indicated that the subcommittee's recommended reduction  was                 
  too drastic and that it would threaten the Divisions ability                 
  to provide a flawless primary and general election.                          
                                                                               
  Co-Chair Hanley  OBJECTED,  observing  that  there  a  carry                 
  forward exists from the  year before last year.   During the                 
  last  funded  election, a  two  ballot primary  existed; the                 
  Governor's  Office  has  requested  a  $573 thousand  dollar                 
  increment  to  cover  the  initial  costs.   The  Conference                 
                                                                               
                               11                                              
                                                                               
                                                                               
  Committee  authorized  $400  thousand dollars  for  the dual                 
  primary.  In 1996, the Governor left $90 thousand dollars in                 
  the base budget.  Co-Chair Hanley indicated  that this year,                 
  the  Governor  has  requested  the  same  amount.    For the                 
  increased cost request,  half has  been allocated under  the                 
  current budget.                                                              
                                                                               
  A roll call was taken on the MOTION.                                         
                                                                               
       IN FAVOR:      Brown, Grussendorf, Navarre.                             
       OPPOSED:       Kelly, Kohring, Martin, Mulder, Parnell,                 
                      Therriault, Hanley, Foster.                              
                                                                               
  The MOTION FAILED (3-8).                                                     
                                                                               
  FRONT SECTION                                                                
                                                                               
  Co-Chair   Hanley   distributed  committee   substitute  #9-                 
  GH2035\C,  Cramer,  3/27/96,  to   Committee  members.    He                 
  commented that based  on the Mental Health  Trust Settlement                 
  and as requested in statute, a  separate bill for the mental                 
  health interests has  been created.   That legislation  will                 
  have  both an  operating and  capital aspect for  the mental                 
  health trust authority.  When  the subcommittee reports were                 
  adopted,  it  included  recommendations  for  mental  health                 
  spending.                                                                    
                                                                               
  MIKE  GREANY,  DIRECTOR,  DIVISION  OF LEGISLATIVE  FINANCE,                 
  added that  the capital  appropriations associated with  the                 
  mental health program would also be included in HB 413.                      
                                                                               
  Co-Chair Foster MOVED to  adopt the work draft as  discussed                 
  as the front  section to HB 413.  There  being NO OBJECTION,                 
  it was adopted  to be  incorporated into  the Mental  Health                 
  Trust bill.                                                                  
                                                                               
  Co-Chair Hanley provided  the Committee with  a copy of  the                 
  Front Section comparison between the  Governor and the House                 
  Finance Committee recommendations.  [Copy on file].                          
                                                                               
  VIRGINIA  STONKUS,  FISCAL  ANALYSTS,   LEGISLATIVE  FINANCE                 
  DIVISION, provided a  sectional analysis  of the  comparison                 
  chart.                                                                       
                                                                               
  Section  #1 deals with the Alaska Clean Air Protection Fund.                 
  This section  provides transition  language for  the use  of                 
  revenues related to  the Clean Air Protection  Fund (ACAPF).                 
  Once  approved by the Environmental Protection Agency (EPA),                 
  receipts collected from  air permit fees would  be converted                 
  from general fund program receipts to ACAPF receipts.                        
                                                                               
  The Governor's Section #1 for Alaska  Clean Water Fund would                 
                                                                               
                               12                                              
                                                                               
                                                                               
  appropriate general funds  and federal funds for  the Alaska                 
  Clean Water Fund.   Funding from  this fund follows a  cycle                 
  which begins with the compilation of a funding priority list                 
  for waste water treatment and collection systems.  To  date,                 
  the Alaska Clean Water Fund has made 23 loans to communities                 
  for a total  of $50.5 million  dollars.  There is  currently                 
  $17.0 million dollars available  from the fund to  be loaned                 
  for sanitation projects.                                                     
                                                                               
  Ms. Stonkus continued, House  Section #3, Governor's Section                 
  transfer a portion of the available unrestricted cash in the                 
  general account of the AHFC revolving fund, by the direction                 
  of the AHFC  board, to the general fund.  She noted that the                 
  amount transferred in FY96 was $70 million dollars.                          
                                                                               
  Subsection (b)  appropriates any  earnings related  to AHFC,                 
  including loan  interest payments, mortgage  loan commitment                 
  fees, and  income earned  on assets  of the corporation,  to                 
  AHFC to hold as  corporate receipts.  Those receipts  are to                 
  be  allocated  among   the  AHFC  revolving  fund,   housing                 
  assistance loan fund  and the senior housing  revolving loan                 
  fund.                                                                        
                                                                               
  Subsection (c)  identifies the amount  of corporate receipts                 
  to be  appropriated to AHFC  for housing  loan programs  not                 
  subsidized  by  AHFC  and  housing  loan programs  that  are                 
  subsidized by AHFC.                                                          
                                                                               
  Ms. Stonkus pointed out that the House would increase by $20                 
  million dollars  the portion  of the  available unrestricted                 
  cash in the general account of the AHFC revolving fund to be                 
  transferred to the general fund.                                             
                                                                               
  NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF                 
  MANAGEMENT AND BUDGET,  OFFICE OF THE GOVERNOR,  stated that                 
  the  $20 million  dollar shift  would not  make  that amount                 
  available for capital  projects from  FY96.  She  summarized                 
  that the AHFC,  FY96 capital budget  was a little less  than                 
  $53 million dollars.                                                         
                                                                               
  JOHN  BITNEY, LEGISLATIVE  LIAISON,  ALASKA HOUSING  FINANCE                 
  (AHFC),  ANCHORAGE,  added that  the  total transfer  to the                 
  State  was $127  million  dollars and  that  included a  $57                 
  million  dollar transfer to the capital budget.  Those funds                 
  also  included  a   $22  million  dollar  transfer   to  the                 
  University.  He added that the  FY97 budget does not contain                 
  any funding for the University.                                              
                                                                               
  Ms. Stonkus  continued, House Section  #4 was a  new section                 
  added  by  the House  to  Alaska Industrial  Development and                 
  Export Authority  (AIDEA) which  would transfer  $21 million                 
                                                                               
                               13                                              
                                                                               
                                                                               
  dollars of the  available unrestricted  cash balance in  the                 
  AIDEA revolving fund, through direction  by the board to the                 
  general fund.                                                                
                                                                               
  Representative Brown  questioned  the  effect  the  transfer                 
  would have on AIDEA's  projects.  Ms. Slagle noted  that the                 
  Governor  has  resisted  any  drain  on AIDEA  in  order  to                 
  determine the most effective way to address their assets.                    
                                                                               
  Ms. Stonkus noted that House  Section #5, Governor's Section                 
  would appropriate  from the Permanent Fund  Earnings Reserve                 
  Account those funds necessary for the dividend program.  The                 
  amount reflected  for transfer to  the dividend fund  in the                 
  Permanent Fund's January report was $621 million dollars.                    
                                                                               
  Subsection (b) appropriates from the Permanent Fund Earnings                 
  Reserve  Account  for  inflation-proofing.    The  estimated                 
  amount would be $405 million dollars.                                        
                                                                               
  Subsection (c) would allow for the deposit of any funds that                 
  are  received  that fall  within  the  25% or  50%  split on                 
  mineral lease rentals, royalties, royalty sales, etc. to the                 
  Permanent Fund.                                                              
                                                                               
  Subsection (d)  allows interest  earned on  certain disputed                 
  mineral lease rentals, royalties, sales,  etc., and that 25%                 
  or 50%  of that recovered goes  to the Permanent Fund.   Any                 
  interest that accrues to the Permanent Fund portion of those                 
  settlements prior to being recovered by the  State, or while                 
  held by the State, shall be deposited to the Fund.                           
                                                                               
  Subsection (e) provides  conditional language  appropriating                 
  the balance of  the Alaska  Permanent Fund Earnings  Reserve                 
  account  unless   voters  ratify   a  State   Constitutional                 
  amendment specifying  a different  use at  the 1996  general                 
  election.                                                                    
                                                                               
  Co-Chair  Hanley noted  that  originally, the  Governor  had                 
  provided over  a $1 billion dollar deposit  to the Permanent                 
  Fund and  that Section (e)  was the conditional  language of                 
  that  appropriation  based on  a vote  by  the people.   Ms.                 
  Slagle added, that section would transfer the balance.                       
                                                                               
  Ms. Stonkus continued,  Governor's Section #4 and  the House                 
  Section  #6  are  identical and  address  the  Alaska Public                 
  Utilities Commission (APUC) estimated carry-forward receipts                 
  for the FY97 which range  between $150 thousand dollars  and                 
  $200 thousand dollars.                                                       
                                                                               
  Governor's Section  #5 and  House Section  #7 are  identical                 
  sections dealing with the Alaska Seafood Marketing Institute                 
                                                                               
                               14                                              
                                                                               
                                                                               
  (ASMI), an estimated carry-forward of $300 thousand dollars.                 
  Representative  Martin   suggested  that   an  estimate   be                 
  included.   Mr. Greany  explained that those  funds had been                 
  appropriated in a  prior year.   He agreed  that the  amount                 
  should be disclosed.                                                         
                                                                               
  Ms. Stonkus noted  that the Governor's Section  #6 addresses                 
  the collective  bargaining agreement  monetary terms.   This                 
  section would appropriate funds from the general fund to the                 
  Department  of  Administration  for payment  to  the  Alaska                 
  Public  Employees'  Association (APEA)/supervisory  unit for                 
  training to satisfy  the terms of the  collective bargaining                 
  agreement for the  fiscal year  ending June 30,  1997.   The                 
  House deleted that section.                                                  
                                                                               
  Mr. Greany stated that House  Section #8, Governor's Section                 
  (a) and (b) would allow the State to  cover any shortfall in                 
  unrestricted State revenues  available for appropriation  in                 
  FY97 from the CBR  per Article IX, Section #17.   The amount                 
  necessary   to    balance   general   fund    revenues   and                 
  appropriations  would be  appropriated to  the  general fund                 
  from the CBR.                                                                
                                                                               
  Subsection (c) stipulates that appropriations  made by (a) &                 
  (b)  of that  section  are made  under  Article IX,  Section                 
  material from the general operations budget.                                 
                                                                               
  (Tape Change, HFC 96-98, Side 2).                                            
                                                                               
  Ms.  Stonkus  addressed House  Section  #9 -  disapproval of                 
  monetary  terms.   The  section  stipulates that  unless the                 
  Legislature  adopts a separate appropriation measure to fund                 
  the monetary  terms of  the collective  bargaining units  of                 
  ASEA/General  Government,  APEA/Supervisory Unit,  LTC, IBU,                 
  MMP unit, PSEA, Alyeska Centralized School  Employees Assn.,                 
  IBEW/Court System,  U of A/Classified Employees,  and Alaska                 
  Community  Colleges  Federation  of Teachers,  the  monetary                 
  terms of the above referenced bargaining agreements would be                 
  rejected.                                                                    
                                                                               
  Ms. Stonkus continued, House Section #10, Governor's Section                 
  Fund.  Ms. Slagle explained to Representative Martin that $9                 
  million  dollars federal  funds  had been  appropriated this                 
  year.                                                                        
                                                                               
  Ms. Stonkus stated that House Section #11 and the Governor's                 
  Section  #9  would  allocate   federal  and  other   program                 
  receipts.    Subsection (a)  is  boiler plate  language that                 
  provides for additional funding authority for excess federal                 
                                                                               
                               15                                              
                                                                               
                                                                               
  and  program  receipts  through the  Legislative  Budget and                 
  Audit Committee (LBA) process.                                               
                                                                               
  Subsections  (b)  and (c)  are  boiler plate  language which                 
  allows state  funds to be  reduced if additional  federal or                 
  other funds are available and permitted by federal statutes,                 
  and requires that  for any shortfall  of federal or  program                 
  receipts, the  appropriation would  be reduced  accordingly.                 
  That language would prohibit agencies from expending receipt                 
  authority for revenues they would not actually receive.                      
                                                                               
  The House did as  it did in FY96 and amended  Subsection (d)                 
  to cap  the possible  general fund  offset for  TItle XX  at                 
  $6.31 million dollars.                                                       
                                                                               
  Ms.  Stonkus  pointed   out  that  House  Section   #12  and                 
  Governor's  Section #10 for the Four  Dam Pool Transfer Fund                 
  were identical.  This would make the necessary appropriation                 
  from the Four Dam Pool Transfer Fund to the Southeast Energy                 
  Fund   the   Power   Cost   Equalization,   Rural   Electric                 
  Capitalization Fund and the Power Project Fund.                              
                                                                               
  The Governor's Section  #11, House  Section #13 address  the                 
  Information Services  Fund (ISF).   The  appropriation would                 
  cover  those   services  provided  by   the  Department   of                 
  Administration (DOA) for information and telecommunications.                 
  The  House reduced I/A  receipts to reflect  House action on                 
  salary increases.                                                            
                                                                               
  Ms. Stonkus continued,  the Governor's  Section #12 and  the                 
  House Section #14 addressed Insurance Claims and Reclamation                 
  of  State Land.    The House  added  the Governor's  amended                 
  language.   Subsection  (a)  would allow  up  to $5  million                 
  dollars to be  "swept" from  otherwise lapsing general  fund                 
  appropriations for catastrophic reserve purposes.                            
                                                                               
  House Section  #15,  Governor's Section  #13  addresses  the                 
  Marine Highway  System Fund  (AMHS).   Chapter 193  SLA 1990                 
  created the Alaska Marine Highway System Fund.   Its purpose                 
  is to  provide stability  to  the marine  highway system  by                 
  appropriating a consistent amount of general funds each year                 
  to be  combined with  the marine  highway system's  revenue.                 
  The House reduced the general fund transfer to reflect House                 
  action on salary adjustments, CIP transfers and subcommittee                 
  action.                                                                      
                                                                               
  House Section #16, Governor's  Section #14 addresses highway                 
  and aviation fuel tax.   Both recommendations are the  same.                 
  The  House Section  #17 and the  Governor's Section  #15 are                 
  identical and allows  for the general fund  program receipts                 
  from occupational licensing  fees under  AS 08.01.065 to  be                 
  carried forward for operating costs in FY97.                                 
                                                                               
                               16                                              
                                                                               
                                                                               
  Ms. Stonkus continued, House Section #18, Governor's Section                 
  Prevention (OHSRP) account which contains funds appropriated                 
  from  the  general  fund to  the  OHSRPR  Fund  from the  3%                 
  surcharge collected in the general fund during FY96.                         
                                                                               
  The OHSRP prevention mitigation account  is a sub-account of                 
  the  general  fund.    The  prevention   mitigation  account                 
  receives  money  recovered  from   parties  responsible  for                 
  containment   and  cleanup   of   oil  or   other  hazardous                 
  substances.  The two proposals are the same.                                 
                                                                               
  Ms.  Stonkus  stated  that  House  Section  #19,  Governor's                 
  Section #17  were the  same and  would address  the Oil  and                 
  Hazardous Substance Release Response account.   The response                 
  account contains funds appropriated from the general fund to                 
  the OHSRPR Fund from  the 2 cent surcharge collected  in the                 
  general fund during FY96.                                                    
                                                                               
  House Section #20  and the Governor's amended  section deals                 
  with the retained fees.  The  language addresses the need to                 
  appropriate vendor compensation/bankcard service fees.   The                 
  House amended the Governor's amended language to include all                 
  fund sources for vendor compensation  of fishing and hunting                 
  licenses.                                                                    
                                                                               
  Ms. Stonkus advised  that House  Section #21 and  Governor's                 
  Section  #18   would   appropriate   general   fund   salmon                 
  enhancement tax receipts  to the Department of  Commerce and                 
  Economic  Development  for  qualified regional  associations                 
  operating  within a  region  designated under  AS 16.10.375.                 
  The two are identical.                                                       
                                                                               
  The  House  Section  #23  and  Governor's  Section  #20  are                 
  identical  and   would  appropriate  general  funds  to  the                 
  Department of  Revenue in  the amounts  necessary to  refund                 
  local governments their  share of  taxes and fees  collected                 
  for payment in FY97.                                                         
                                                                               
  Ms.  Slagle  pointed  out  that  the Administration  has  no                 
  discretion as to what can be done with the funds.  It is set                 
  in statute that  a certain  percentage of  the shared  taxes                 
  received have to be returned to the communities.                             
                                                                               
  Ms.  Stonkus  noted that  House  Section #24  and Governor's                 
  Section #21 address  the debt  service appropriations.   The                 
  Governor's section dealt with the transfers from the general                 
  fund  to  the debt  service  and  from debt  service  to the                 
  appropriate sources.   The House  amended the Governor's  to                 
  include individual subsections for transfers from the Alaska                 
  debt retirement fund for leases (d), G.O. debt (e), from the                 
                                                                               
                               17                                              
                                                                               
                                                                               
  International Airports  Revenue Fund  for revenue bond  debt                 
  (f),  and  from  the  Alaska debt  retirement  fund  to  the                 
  Department of Education from school debt (g).                                
                                                                               
  House Section #25  and Governor's Section #22  basically are                 
  identical  and  address the  State  Training and  Employment                 
  Program  funded  from the  Employment  and  Training Program                 
  Account  (ETPA).     That  account  is  created   through  a                 
  contribution of one-half of one percent from each employees'                 
  wage.   Unspent balances  must be  lapsed from this  account                 
  into the unemployment compensation fund.  This section makes                 
  that appropriation.                                                          
                                                                               
  House  Section  #26, Governor's  Section  #23  addresses the                 
  storage  tank   registration  fees   and  would  allow   the                 
  Legislature to appropriate on an annual basis to the storage                 
  tank assistance fund from the  general fund any registration                 
  fees  collected on  underground  petroleum storage  tanks or                 
  tank systems.   Estimate of receipts  collected in FY96  for                 
  deposit  into  the  Storage  Tank  Assistance Fund  is  $280                 
  million dollars.   That figure  was determined through  work                 
  with the agencies and through the Governor's budget.                         
                                                                               
  The  Governor's  amended proposed  a  section for  the Exxon                 
  Valdez  Spill Settlement  Fund.   Subsection  (b) identifies                 
  inter-agency receipts as the fund source for Trustee Council                 
  projects  in the back section of the appropriation bill, and                 
  gives OMB/EVOSS Trustee Council the  authority to reallocate                 
  the inter-agency  receipts between  and among the  agencies.                 
  Subsection  (c)  notes  that  any  excess appropriations  or                 
  shortfalls will be  addressed by the Legislative  Budget and                 
  Audit Committee  (LBA).   Subsection (d)  extends the  lapse                 
  date for the funds through 9/30/97.   The House deleted that                 
  section.  EVOSS projects proposed  in the Governor's amended                 
  budget will be funded directly with EVOSS funds in the House                 
  budget.  Interim adjustments  could be accommodated  through                 
  the normal Legislative Budget and  Audit Committee process.                  
                                                                               
                                                                               
  Ms.  Stonkus commented  that House  Section #27,  Governor's                 
  Section  #24 was  prompted by  the omnibus fee  bill dealing                 
  with loan guarantee  fees, and  appropriating those fees  to                 
  offset losses.                                                               
                                                                               
  Representative Mulder MOVED  to adopt the Front  Section for                 
  HB 412.  There being NO OBJECTION, it was adopted.                           
                                                                               
  HB 412 was HELD in Committee for further consideration.                      
                                                                               
  HB 413 was HELD in Committee for further consideration.                      

Document Name Date/Time Subjects