Legislature(1995 - 1996)

05/06/1996 12:25 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  SENATE BILL NO. 215                                                          
       "An  Act  streamlining  the  functions  of   state                      
       government, including authorizing the commissioner                      
       of  fish  and  game to  award  grants  for certain                      
       resource activities; allowing agents  selling fish                      
       and  game  licenses  and tags  to  retain  certain                      
       compensation; authorizing the Department of Health                      
       and Social  Services to  award grants  for certain                      
       services for developmentally  delayed or  disabled                      
       children;   relating   to   rabies   control   and                      
       administration of flour and bread standards by the                      
       Department    of    Environmental    Conservation;                      
       repealing the Athletic Commission,  the regulation                      
       of boxing  and  wrestling,  the  certification  of                      
       professional geologists, and  the Water  Resources                      
       Board;  repealing  certain  filing statements  and                      
       bonds for  enforcement and  collection of  certain                      
       taxes; and providing for an effective date."                            
  BUDGET,  OFFICE OF  THE GOVERNOR noted  that there  are some                 
  legal concerns regarding portions of the legislation.                        
  Ms. Slagle  provided members  with a  sectional analysis  of                 
  CSSB 216 (FIN) am (copy on  file).  She review the sectional                 
       *    Sections 1 & 2.  Allows school districts to submit                 
            reports for  their  six  year  plans  for  capital                 
            maintenance and construction  requirements to  the                 
            Department of Education on a biennial basis.                       
       *    Section 2.   Allows  the University  of Alaska  to                 
            require  employees  to deposit  paychecks directly                 
            into a  bank, savings  and loan  or credit  union.                 
            Processing cuts will be reduced.                                   
       *    Section 4.  Allows the Department of Fish and Game                 
            to  award grants for Kenai River drainage projects                 
            specifically  appropriated  for FY  94 and  FY 96.                 
            Without this section  the grants would have  to be                 
            passed  through  another  state organization  with                 
            granting authority.                                                
       *    Sections 5,  6,  and 8.   Allows  agents of  sport                 
            fishing  and hunting  licenses and tags  to retain                 
            the full 5  percent allowed  for compensation  for                 
            their  services.    Without these  sections  money                 
            would be paid  to the  State and then  transferred                 
       *    Section 7.   Allows  agents of  sport fishing  and                 
            hunting licenses and  tags to assign a  portion of                 
            their compensation  to an in-state  nonprofit fish                 
            or game association.   This  section was added  in                 
            the Senate.                                                        
       *    Sections  9  -  13.    Allows  the  Department  of                 
            Commerce and Economic Development to collect taxes                 
            on insurance premiums  more frequently than  on an                 
            annual basis and to be collected electronically.                   
  Representative Parnell  asked  if this  change would  effect                 
  insurance  companies.    Ms. Slagle  stated  that  insurance                 
  industry representatives  testified that  they could  accept                 
  quarterly collection,  but did  not want  collections to  be                 
  more frequent.                                                               
       *    Section 14.  Reduces  the requirements for  filing                 
            of credits for  certain mining exploration  costs.                 
            This  would  eliminated  the  annual  filing   and                 
            certification process and  substitute a  threshold                 
            of when  a credit reaches $250.0  thousand dollars                 
            or the holder is ready to take the credit.                         
       *    Section  15.     Requires   the  Alaska   Railroad                 
            Corporation   to   use   competitive  bidding   on                 
            construction   contracts   over   $25.0   thousand                 
            dollars, that the Department of Transportation and                 
            Public Facilities  authorizes.   This section  was                 
            added in the Senate.                                               
       *    Section 16.  Shortens the time limit on payment of                 
            warrants to 1 year.  The  current statute is for 2                 
            years.     This  would  be  consistent   with  the                 
            unclaimed property statutes.                                       
       *    Section  17.   Calculates terminal  leave payments                 
            based on annualized rate of pay.                                   
       *    Section 18.  Is in  conjunction with a repealer in                 
            Section 24 which  eliminated the non-resident  tax                 
            affidavit tax bond program.                                        
       *    Sections 19 & 20.  Allows the Department of Health                 
            &  Social  Services  granting  authority  for  the                 
            Infant Learning Program.                                           
       *    Section 21.   This section would restrict  certain                 
            state  corporations  to   contract  for   lobbying                 
            activities.  This section is a duplication.                        
       *    Section  22.   Repeals  the requirement  that  the                 
            Department  of  Environmental  Conservation report                 
            and care  for  animals  suspected  of  rabies  and                 
            handle the disposal of rabid  animals.  Eliminates                 
            the requirement that  the Department regulate  the                 
            vitamin and  mineral  content of  flour and  bread                 
            sold  in  the  State.     This  requirement  is  a                 
            duplication  of  federal regulations.   Eliminates                 
            the requirement that employees that have separated                 
            from state government  employment and rehired must                 
            repay  leave  received  in  cash  at the  time  of                 
       *    Section 23.   Eliminates the Athletic  Commission,                 
            Boxing and  Wrestling Commission.   They have  not                 
            been active in the past several years.  Eliminates                 
            the  requirement  that professional  geologists be                 
            certified  by  the  Department  of  Commerce   and                 
            Economic  Development.     Eliminates  the   Water                 
            Resources Board.                                                   
       *    Section 24.   Eliminates the  calculation required                 
            to transmit remainder  of vendor compensation  for                 
            issuance of  sport fishing  and hinging  licenses.                 
            Eliminates   non-resident   affidavit   tax   bond                 
       *    Sections   25  and   26.     These  sections   are                 
            transitional language.                                             
       *    Section   27.     This  section  deals   with  the                 
            applicability of warrants  issued on or after  the                 
            effective date of Section 16.                                      
       *    Section 28.  Restricts the  payment of state money                 
            to entities  that are  not incorporated under  the                 
            laws of the State.                                                 
       *    Sections  29  -  31.    These  sections  implement                 
            effective dates                                                    
  Representative Brown referred  to Section 5.   She asked  if                 
  there are provisions for auditing of vendors.                                
  OF FISH AND GAME explained that there is a monthly reporting                 
  system with  vendors.   He  stated  that the  Department  is                 
  comfortable with the shift to a retained fee.  He emphasized                 
  that the current system is redundant.                                        
  Representative Brown referred to Section  14.  She expressed                 
  concern that the certification  be contemporaneous with when                 
  the money and records are available.  She emphasized that it                 
  would not be sensible  to allow records to be  collected for                 
  20 years before they are turned in.                                          
  RESOURCES  pointed  out  that  CPA  certification  would  be                 
  required  when   credits  reach  $250.0   thousand  dollars.                 
  Representative Brown  noted that credits  could be collected                 
  for a number of  years.  Ms. Caroll reiterated  that credits                 
  would be turned in when they  reach at least $250.0 thousand                 
  dollars  or when  production begins.   She  agreed  that the                 
  language  could  be  tightened.    She  explained  that  the                 
  Department did not want to  require annual certification due                 
  to the amount of additional paperwork.  Representative Brown                 
  noted   that  the   credits   are  direct   credits  against                 
  obligations owed to  the State.  She noted that  there is no                 
  requirement for the CPA to certify  that credits are correct                 
  or that  the expenditures actually  took place.   Ms. Caroll                 
  suggested a three year limit.                                                
  Representative Brown referred to Sections 19 and 20.                         
  SOCIAL SERVICES explained that these sections will allow the                 
  Department to continue  the status quo.   He noted that  the                 
  addition  of   federal  aid   required  regulations.     The                 
  Department of  Law  reviewed the  regulations and  concluded                 
  that the Department of Health & Social Services did not have                 
  sufficient grant making authority.                                           
  Representative Therriault provided  members with Amendment 1                 
  (copy on file).                                                              
  NATURAL RESOURCES discussed  Amendment 1.  He  stressed that                 
  the amendment should be considered a conceptional amendment.                 
  He  explained  that  Section  17  clarifies under  and  over                 
  payment of royalties and how  they are calculated.   Section                 
  18  sets  up a  period of  time  during which  interest will                 
  accrue on overpayments.   He  observed royalty payments  are                 
  for the preceding month.  He  noted that there are generally                 
  metering errors.  He added that  smaller royalty payers base                 
  their payments on the larger royalty  payers.  If the larger                 
  payer is wrong  then the  smaller companies are  wrong.   He                 
  noted that errors are generally cleared  up in 60 days.   He                 
  stressed   that  small   adjustments   are  not   worth  the                 
  administrative  overhead.   The  amendment  would allow  the                 
  Department to dismiss small over or under payments.  The set                 
  interest  rate is  11  percent.   He  maintained that  "may"                 
  should be changed to "shall".                                                
  Representative   Parnell   questioned  the   interest  rate.                 
  Representative Therriault noted  that the existing statutory                 
  language sets the interest rate.                                             
  Amendment 1 was HELD.                                                        
  Representative Mulder  MOVED to report CSSB 215 (FIN) am out                 
  of Committee  with individual  recommendations and  with the                 
  accompanying fiscal notes.  There being NO OBJECTION, it was                 
  so ordered.                                                                  
  CS SB  215 (FIN) am was  reported out of Committee  with "no                 
  recommendation" and with  three fiscal impact notes,  one by                 
  the Department of  Fish and Game,  one by the Department  of                 
  Revenue, dated 5/1/96, and one by the Department of Commerce                 
  and Economic Development, dated 1/12/96;  and with four zero                 
  fiscal  notes,  one  by  the  Department of  Revenue,  dated                 
  5/1/96, one by the Department of Environmental Conservation,                 
  dated  1/12/96, one  by  the Department  of Health  & Social                 
  Services,  dated  1/12/96,  and  one  by the  Department  of                 
  Natural Resources, dated 5/1/96.                                             

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