Legislature(2015 - 2016)HOUSE FINANCE 519

02/02/2015 01:30 PM House FINANCE

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01:32:16 PM Start
01:33:17 PM Fy 16 Budget Overview: Department of Environmental Conservation
02:31:23 PM Fy 16 Budget Overview: Alaska Court System
03:19:52 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Heard & Held
- FY16 Dept. of Transportation & Public
-- Above Item Rescheduled to 2/9/15 --
- FY16 Alaska Judiciary
- FY16 Dept. of Environmental Conservation
--Above Item Rescheduled from 2/9/15 --
HOUSE BILL NO. 72                                                                                                             
     "An  Act making  appropriations  for  the operating  and                                                                   
     loan  program  expenses  of  state  government  and  for                                                                   
     certain    programs,    capitalizing    funds,    making                                                                   
     reappropriations,  and 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 NO. 73                                                                                                             
     "An  Act making  appropriations  for  the operating  and                                                                   
     capital    expenses    of   the    state's    integrated                                                                   
     comprehensive mental  health program; and  providing for                                                                   
     an effective date."                                                                                                        
^FY 16 BUDGET OVERVIEW: DEPARTMENT OF ENVIRONMENTAL                                                                           
1:33:17 PM                                                                                                                    
LARRY  HARTIG,  COMMISSIONER,   DEPARTMENT  OF  ENVIRONMENTAL                                                                   
CONSERVATION,  highlighted  the PowerPoint  presentation  "FY                                                                   
16   Department   Overview:   Department   of   Environmental                                                                   
Commissioner Hartig began with slide 2: "DEC's Mission."                                                                        
     Protect human health and the environment.                                                                                  
Commissioner Hartig reviewed slide 3: "Outcomes."                                                                               
     -Clean  water,  healthy  air,  and  good  management  of                                                                   
     hazardous materials and waste                                                                                              
     -Safe drinking water and sanitary waste disposal                                                                           
     -Food safe to eat                                                                                                          
     -Low risk  of spills  and efficient, effective  response                                                                   
     when spills occur                                                                                                          
     -Wise resource development for a growing state                                                                             
Commissioner Hartig turned to slide 4: "Means."                                                                                 
     -Science-based standards                                                                                                   
     -Permits   and   authorizations    incorporating   these                                                                   
     -Monitoring,   outreach,   compliance  assistance,   and                                                                   
    -Emergency response and oversight of spill clean-up                                                                         
     -Meaningful   and   effective   public   processes   for                                                                   
     developing standards and permits                                                                                           
     -Technical    assistance,   grants,    and   loans    to                                                                   
     communities   for   drinking    water   and   wastewater                                                                   
Commissioner  Hartig discussed  Slide 5:  "What Alaskans  Get                                                                   
for Their Money."                                                                                                               
     According  to   calculations  by  Legislative   Finance,                                                                   
     DEC's FY2016  general fund budget  is equal to  $144 per                                                                   
     year per resident worker - that's just 39¢ a day for:                                                                      
          clean air to breathe                                                                                                  
          clean water to drink                                                                                                  
          safe food to eat                                                                                                      
          clean land and waters                                                                                                 
          responsible resource development                                                                                      
     If you  look at  the numbers  by total population,  that                                                                   
     number drops to roughly 18¢ a day per Alaskan                                                                              
Commissioner   Hartig  commented   that  the  Department   of                                                                   
Environmental  Conservation's  (DEC) mission  benefitted  the                                                                   
general  population   of  the   state  as  well   as,  future                                                                   
generations  of   Alaskans,  tribes,  and   communities.  The                                                                   
department  benefitted businesses  by ensuring safe  economic                                                                   
development   through   its  permits,   authorizations,   and                                                                   
Commissioner  Hartig   continued  with  slide   6:  "Existing                                                                   
Budget Conditions."                                                                                                             
    -Federal Sequestration and declining federal funds                                                                          
          -Ex: Drinking Water program lost $267.2 federal                                                                       
       revenue in FY2014, more than 3% of all funds                                                                             
     -Budget cuts in recent years                                                                                               
     -Declining balance in the Prevention Account                                                                               
     -Not all fees reflect the actual cost of the work                                                                          
          -Ex: Fees for permitted Direct Market Fishing                                                                         
          Vessels  <     65 feet are set in statute and                                                                         
          cover approximately 12%  of the cost to conduct                                                                       
          vessel inspections                                                                                                    
     -DEC has implemented cost saving measures in FY2015:                                                                       
          -Retaining vacancies                                                                                                  
          -Avoiding non-essential travel                                                                                        
          -Additional    review   of   pending    contractual                                                                   
     -Department-wide vacancy rate is currently about 12%,                                                                      
     but varies across the five divisions                                                                                       
Commissioner  Hartig discussed  budget cuts  and how  DEC had                                                                   
been  cutting the  budget over  the years.  He remarked  that                                                                   
the  Village  Safe  Water  Program lost  60  percent  of  its                                                                   
federal  funding  and  currently   the  department  was  $2.1                                                                   
million  short funded  out of  a $15 million  budget for  the                                                                   
Spill  Prevention and  Response  (SPAR) program  due to  less                                                                   
than  expected  interest  earnings  income  on  the  response                                                                   
Commissioner   Hartig   emphasized  that   the   department's                                                                   
vacancy  rate  was  one indication  of  the  agency's  stress                                                                   
because  of budget constraints.  He detailed  that a  typical                                                                   
vacancy  rate was  10 percent  and that the  vacancy rate  in                                                                   
the  SPAR division  was  15 percent  and  13  percent in  the                                                                   
Division of Water.                                                                                                              
1:39:09 PM                                                                                                                    
Commissioner  Hartig advanced to  slide 7: "Budget  Reduction                                                                   
     -Services that are mandated by statute                                                                                     
     -Services   that  are  necessary   to  implement   DEC's                                                                   
     mission and core responsibilities                                                                                          
     -Services that  can't be performed by  local government,                                                                   
     federal government, or others                                                                                              
     -Services that will be difficult to restore                                                                                
     -Services  that  are a  foundation  for economic  growth                                                                   
     and prosperity                                                                                                             
     -Services that enjoy strong public support                                                                                 
     -Services that leverage other resources                                                                                    
Commissioner  Hartig  emphasized  that regardless  of  budget                                                                   
cuts he wanted permitting programs to improve and progress.                                                                     
Co-Chair  Neuman  explained  that  he  instructed  the  House                                                                   
Finance  Subcommittees  to review  statutes  that burdened  a                                                                   
department  but  did  not  provide a  benefit.  In  order  to                                                                   
achieve   more  effective   cuts,  he   requested  that   the                                                                   
departments  recommend  outdated   statutes  for  elimination                                                                   
that  increase costs  and burden  staff. Commissioner  Hartig                                                                   
concurred and  noted that the  department was in  the process                                                                   
of identifying cuts whose impacts could be mitigated.                                                                           
Commissioner   Hartig  turned  to   slide  8:  "Division   of                                                                   
     Commissioner: Larry Hartig                                                                                                 
     Deputy: Lynn Kent                                                                                                          
     Director: Tom Cherian                                                                                                      
          -Commissioner's Office                                                                                                
          -Administrative Services                                                                                              
               -Information Services                                                                                            
               -Financial Services                                                                                              
               -Budget Services                                                                                                 
               -Procurement & Building Management                                                                               
               -Environmental Crimes Unit                                                                                       
          -State Support Services                                                                                               
               -Leases and Contracts                                                                                            
     Challenges & Opportunities:                                                                                                
          -Decreasing Budgets                                                                                                   
          -Unfunded Administrative Cost Increases                                                                               
          -Succession Planning and Workforce Development                                                                        
Commissioner   Hartig  moved   to  slide   9:  "Division   of                                                                   
Environmental Health."                                                                                                          
     Director: Elaine Busse Floyd                                                                                               
          -Director's Office                                                                                                    
          -Food Safety & Sanitation                                                                                             
          -Laboratory Services                                                                                                  
          -Drinking Water                                                                                                       
          -Solid Waste Management                                                                                               
          Building Maintenance & Operations - Environmental                                                                     
               Health Lab                                                                                                       
     Challenges & Opportunities:                                                                                                
          -Declining Federal Funding for the Drinking Water                                                                     
          -Complex Federal Requirements                                                                                         
          -High Risk Food Safety Inspections                                                                                    
          -Unique Laboratory Technology & Equipment Needs                                                                       
Commissioner Hartig  reported that Federal  Sequestration had                                                                   
long-term impacts on the division's budget.                                                                                     
Commissioner  Hartig turned  to  slide 10:  "Division of  Air                                                                   
     Director: Alice Edwards                                                                                                    
          -Director's Office                                                                                                    
          -Air Quality                                                                                                          
               -Permitting and Compliance                                                                                       
               -Community Air Quality                                                                                           
               -Air Monitoring                                                                                                  
     Challenges & Opportunities:                                                                                                
          -Continue to meet industry needs for air permits                                                                      
          -Fairbanks Air Quality/ Woodsmoke                                                                                     
          -Changing Federal Rules and Standards                                                                                 
Commissioner  Hartig   relayed  that  the  Division   of  Air                                                                   
Quality  was the  only division  that was  adding a  position                                                                   
due to increasing demands from the AKLNG pipeline project.                                                                      
1:44:23 PM                                                                                                                    
Co-Chair  Neuman   thought  that  projects  like   the  AKLNG                                                                   
project were  required to pay  for its own permitting  costs.                                                                   
He  asked for  clarification.  Commissioner Hartig  responded                                                                   
that certain federal  air quality permit costs  were required                                                                   
to  be paid  by  the  permitee.  However state  permits  were                                                                   
issued  for smaller  projects when  requirements "fell  under                                                                   
the  criteria" of  federal permits  and  were called,  "minor                                                                   
source permits."  Minor source permits were not  mandated for                                                                   
cost recovery.  In addition,  other duties  performed  by the                                                                   
division  such   as  monitoring,  establishing   air  quality                                                                   
standards  or  plans  required   undesignated  general  funds                                                                   
Representative  Wilson  asked  whether  the  Fairbanks  North                                                                   
Star  Borough would  need DEC  approval to  charge fines  for                                                                   
air quality  violations if the  local ordinance  was adopted.                                                                   
Commissioner  Hartig responded that  under state  statute the                                                                   
borough  had   the  ability,   as  an  "approved   local  air                                                                   
authority"  to implement  their  own  air program.  He  added                                                                   
that if  the borough  went beyond the  state plan  to contain                                                                   
emissions, DEC could  adopt the additional measures  into the                                                                   
state plan;  subsequently under  federal law the  state would                                                                   
also assume the  oversight to enforce implementation  of such                                                                   
measures.  Representative Wilson  asked if  DEC chose  not to                                                                   
adopt any  additional measures  the borough might  implement,                                                                   
would  that  produce  savings  for  the  state.  Commissioner                                                                   
Hartig responded  in the negative and explained  that DEC was                                                                   
relying  on  existing  resources for  Fairbanks  air  quality                                                                   
Representative  Gara  asked  whether  DEC  was  charging  for                                                                   
costs associated  with issuing state permits and  if not, was                                                                   
DEC   considering   cost   recovery    for   state   permits.                                                                   
Commissioner Hartig  responded that  if a project  fell below                                                                   
certain  thresholds for  a federal  permit,  the state  still                                                                   
required  a minor  source  permit. He  indicated  that a  fee                                                                   
structure  was  set  in statute  regarding  what  costs  were                                                                   
recoverable.  The fees for  recoverable costs were  currently                                                                   
being increased  for air  quality permits,  but he  could not                                                                   
change via regulation  statutory provisions relating  to what                                                                   
was considered an expense.                                                                                                      
Representative   Gara   asked  for   additional   information                                                                   
regarding whether  the state was losing money  because of the                                                                   
provisions   in  stature.  Commissioner   Hartig   agreed  to                                                                   
provide the information.                                                                                                        
1:50:08 PM                                                                                                                    
Commissioner Hartig  moved onto slide 11: "Division  of Spill                                                                   
Prevention and Response."                                                                                                       
     Director: Kristin Ryan                                                                                                     
          -Spill Prevention & Response                                                                                          
               -Prevention, Preparedness, and Response                                                                          
               -Contaminated Sites                                                                                              
               -Response Fund Administration                                                                                    
     Challenges & Opportunities:                                                                                                
          -Prevention Account Sustainability                                                                                    
          -Managing Risk Associated with New Natural                                                                            
          Resource    Development    Activity   and    Marine                                                                   
Commissioner  Hartig  pointed   to  slide  12:  "Division  of                                                                   
     Director: Michelle Hale                                                                                                    
          -Water Quality                                                                                                        
               -Wastewater Discharge Permitting                                                                                 
               -Cruise Ship                                                                                                     
               -Water Quality Standards, Assessment, and                                                                        
          -Facility Construction                                                                                                
          -Village Safe Water Program                                                                                           
          -Municipal Grants & Loan Program                                                                                      
     Challenges & Opportunities:                                                                                                
          -Continuing to Develop Depth in APDES                                                                                 
          -Improvements to Federal 404 Dredge & Fill                                                                            
          Permitting and Mitigation                                                                                             
          -Declining Federal Funding in the Village Safe                                                                        
          Water Program                                                                                                         
Commissioner  Hartig related  that  water  quality fell  into                                                                   
two categories:  water quality  standards and facilities.  He                                                                   
noted  that   the  Alaska  Pollution  Discharge   Elimination                                                                   
System program  was delegated to  the state from  the federal                                                                   
Environmental Protection  Agency (EPA) which  regulated waste                                                                   
water  discharges  and  was  developing  well.  The  division                                                                   
caught  up with  the  inherited backlog  of  permits and  was                                                                   
issuing an  increasing number  of permits and  authorizations                                                                   
in a timely manner.                                                                                                             
Co-Chair  Thompson  read  reports  about  sewage  lagoons  in                                                                   
small  communities that  were  degrading and  the absence  of                                                                   
federal funds to  mitigate the problem. He  asked whether DEC                                                                   
had  and inventory  of  the failing  sewage  lagoons and  the                                                                   
costs  to address  the issue.  Commissioner Hartig  responded                                                                   
that  the  department  was  examining  the  issue  and  would                                                                   
provide the  information. He remarked  that with  the decline                                                                   
in  the   Village  Safe  Water   funds  the   department  was                                                                   
prioritizing water and wastewater systems versus landfills.                                                                     
Commissioner  Hartig  discussed  slide 13:  "FY2016  Endorsed                                                                   
Budget Request."                                                                                                                
     Operating Request:   $85,864.7                                                                                             
     •Unrestricted GF:   $20,454.6                                                                                              
     •Designated GF:     $27,392.4                                                                                              
     •Other State Funds: $14,388.9                                                                                              
     •Federal Receipts:  $23,628.8                                                                                              
     •Positions:         537                                                                                                    
     Capital Request:    $64,014.9                                                                                              
     •Unrestricted GF:   $18,738.6                                                                                              
     •Other State Funds: $3,026.3                                                                                               
     •Federal Receipts:  $42,250.0                                                                                              
     Lowest capital request since FY2006                                                                                        
     DEC has the second smallest UGF budget of all State                                                                        
     agencies, behind DMVA.                                                                                                     
Commissioner  Hartig pointed to  the pie  chart on  slide 14:                                                                   
"FY2016  Operating Budget  By Fund  Source." He  communicated                                                                   
that each colored  section represented DEC's  funding sources                                                                   
and that federal receipts were a major source of funds.                                                                         
1:55:11 PM                                                                                                                    
Commissioner  Hartig  highlighted  slide 15:  "FY2016  Budget                                                                   
Changes."  He  relayed  that the  chart  indicated  that  the                                                                   
department  was decreasing the  budget by  9.5 percent  in FY                                                                   
2016 along with eliminating 24 positions.                                                                                       
Commissioner Hartig  presented slide 16:  "FY2016 Significant                                                                   
Budget Changes."                                                                                                                
     · Administration                                                                                                           
     · CO    -Efficiencies    due   to   Reorganization    of                                                                   
        Administrative Functions: -$114.1; -1 PCN(-$43.1                                                                        
        UGF/ -$71.0 I/A)                                                                                                        
     · AS    -Efficiencies    due   to   Reorganization    of                                                                   
        Administrative Functions: -$25.0 UGF                                                                                    
     · AS -Replace Federal Receipts with Existing Clean                                                                         
        Water Administrative Fees: $0.0($84.0  Other / -$84.0                                                                   
     · AS -Rebalance Funding of Core Service Lease Costs:                                                                       
        $0.0($400.0 CAPF/$110.0 CPVEC/-$510.0 FED)                                                                              
Commissioner   Hartig   pointed    to   slide   17:   "FY2016                                                                   
Significant Budget Changes."                                                                                                    
        · Environmental Health                                                                                                  
        · FSS  -Reduce  Inspections  of Retail  Food,  Public                                                                   
          Accommodations, & Non-Food Facilities-$869.3 UGF;                                                                     
          -8 PCNs                                                                                                               
        · EHL-Delete  two  Microbiologists   Positions-$170.0                                                                   
          UGF; -2 PCNs                                                                                                          
        · EHL -Maintain Fish Tissue Monitoring Program$0.0                                                                      
          ($250.0 OR/-$250.0 UGF)                                                                                               
        · DW  -Reduced Capacity  in  Drinking Water  Program-                                                                   
          $507.3 UGF; -4 PCNs                                                                                                   
        · SWM  -Efficiencies  due  to Implementation  of  New                                                                   
          Regulations-$85.6 UGF; -1 PCN                                                                                         
Commissioner Hartig noted the large reduction in the food                                                                       
safety program and thought that the function could be taken                                                                     
over by local governments.                                                                                                      
Commissioner Hartig advanced to slide 18: "FY 2016                                                                              
Significant Budget Changes."                                                                                                    
        · Air Quality                                                                                                           
        · AQ   -Expand  Air   Permitting   Program  to   Meet                                                                   
          Industry Needs$123.0 DGF; 1 PCN                                                                                       
        · Spill Prevention & Response                                                                                           
        · SPAR  -Reorganization  and  Consolidation  of  SPAR                                                                   
          Programs-$520.0; -4 PCNs                                                                                              
Commissioner Hartig turned to slide 19: "FY2016 Significant                                                                     
Budget Changes."                                                                                                                
        · Water                                                                                                                 
        · WQ   -Efficiencies   due   to   Reorganization   of                                                                   
          Administrative Functions-$95.0 UGF; -1 PCN                                                                            
        · WQ-Offset   Ocean  Ranger  Fees  for   Fish  Tissue                                                                   
          Monitoring Program-$250.0 OR                                                                                          
        · WQ -Delete Environmental Program Manager-$103.4                                                                       
          UGF; -1 PCN                                                                                                           
        · FC -Replace Federal Receipts with Existing Clean                                                                      
          Water   Administrative    Fees$0.0($700.0   Other/-                                                                   
          $700.0 Fed)                                                                                                           
        · FC      -Maintain       Operator      Certification                                                                   
          Program$0.0($101.1 DGF/-$101.1 Fed)                                                                                   
Commissioner   Hartig   discussed   slide   20:   "Department                                                                   
     -Prevention Account Sustainability                                                                                         
     -Village Safe Water                                                                                                        
          -Federal Funding Decline                                                                                              
          -Alaska Challenge Project                                                                                             
     -Fairbanks Air Quality/ Woodsmoke                                                                                          
Commissioner  Hartig explained  slide 21:  "How the  Response                                                                   
Fund Works."                                                                                                                    
     "It is  the intent  of the  Legislature and declared  to                                                                   
     be the  public policy  of the State  that funds  for the                                                                   
     abatement of  a release of oil or a  hazardous substance                                                                   
     will always be available." (A.S. 46.08.030)                                                                                
     -Response Account                                                                                                          
          -Funded by 1¢ surcharge on each barrel of oil                                                                         
          -Surcharge suspended when fund exceeds $50                                                                            
          -Pays for emergency response activities                                                                               
          -Department   recovers    costs   from   identified                                                                   
          responsible parties                                                                                                   
     -Prevention Account                                                                                                        
          -Funded by a 4¢ surcharge on each barrel of oil                                                                       
          -Pays for operational costs and readiness                                                                             
          activities within the Spill Prevention & Response                                                                     
Commissioner   Hartig  scrolled   to  slide   22:  "Oil   and                                                                   
Hazardous  Substance Release  Prevention  and Response  Fund"                                                                   
which was a graphic depicting how the fund worked.                                                                              
Commissioner  Hartig  discussed  Slide  23:  "Status  of  the                                                                   
Prevention  Account." He  explained that  the light  blue bar                                                                   
on the graph  represented the accounts general  fund dollars;                                                                   
if funding was  maintained at current levels  into the future                                                                   
the account  would have to  be offset  by up to  $7.5 million                                                                   
per  year  with  other  funds   in  light  of  declining  oil                                                                   
revenues.  He concluded  that if other  funding sources  were                                                                   
not identified  SPAR would lose  46 percent of its  budget or                                                                   
approximately 70 positions in the future.                                                                                       
Co-Chair Neuman  asked for  further discussion regarding  the                                                                   
.04  cents  surcharge  and whether  the  department  had  any                                                                   
recommendations on  restructuring the fund to  be sustainable                                                                   
into   the    future   without   additional    general   fund                                                                   
expenditures. Commissioner  Hartig directed attention  to the                                                                   
following slide in response to the question.                                                                                    
1:59:17 PM                                                                                                                    
Commissioner  Hartig turned to  slide 24: "Considerations  in                                                                   
Addressing the Shortfall."                                                                                                      
     -Do not increase the risk from spills                                                                                      
     -Recognize declining production and the impacts of                                                                         
     this to the sustainability of the Response Fund                                                                            
     -Collaborate with existing and potential payees into                                                                       
     the Response Fund to identify the correct amount and                                                                       
     -Look to other sources to identify fair and reasonable                                                                     
     alternatives to help sustain the fund                                                                                      
     -Continue   to   look   for    efficiencies   in   SPAR,                                                                   
     partnerships, new technologies, better assessment of                                                                       
     risks, and improvement to cost recovery                                                                                    
Commissioner   Hartig  conveyed   that  the  department   was                                                                   
engaged  in discussions  with the  oil and  gas industry.  He                                                                   
related  that  the larger  issue  was  why  the oil  and  gas                                                                   
industry should  pay for the  entire fund when  other sources                                                                   
of  spills  and   industries  were  involved.   Some  of  the                                                                   
discussions   that   were   taking   place   was   how   much                                                                   
responsibility  was fair  to  the oil  and  gas industry  and                                                                   
alternative   revenue  sources.   The  department   was  also                                                                   
examining   consolidations   and  efficiencies   within   the                                                                   
Representative  Gara  asked  about   the  possibility  of  an                                                                   
inflation adjustment  on the .05  cents per barrel  surcharge                                                                   
and what  that would amount  to. Commissioner  Hartig replied                                                                   
that  the SPAR  budget  had not  kept  up  with inflation  in                                                                   
relation  to the  Anchorage Consumer  Price  Index (CPI)  and                                                                   
that the surcharge  had not increased since  its introduction                                                                   
in  1989.  In  addition,  the division  had  taken  on  added                                                                   
duties over the years with a flat surcharge.                                                                                    
Commissioner  Hartig  advanced  to slide  25:  "Village  Safe                                                                   
     -Over 4,500 homes in rural Alaska lack running water                                                                       
     and sewage systems                                                                                                         
     -Lack of sanitation poses serious health threat                                                                            
          -Health studies  show a direct  correlation between                                                                   
          clean   water   in    sufficient   quantities   and                                                                   
          significant  reductions in diseases  and infections                                                                   
          that can sometimes be fatal                                                                                           
          -Children  in Southwest Alaska  suffer some  of the                                                                   
          highest   rates   in  the   world   of  a   serious                                                                   
          pneumococcal  bacterial infection which  can affect                                                                   
          the brain, blood or lungs                                                                                             
          -This bacterial  infection is linked  to inadequate                                                                   
          sanitation infrastructure                                                                                             
Commissioner  Hartig   discussed  the  budget   challenge  of                                                                   
carrying out  the program to  communities of  1,000 residents                                                                   
or less  with a decline in  federal funds of over  60 percent                                                                   
within the prior ten years for needs that are constant.                                                                         
Commissioner  Hartig  identified   slide  26:  "Rural  Alaska                                                                   
Water & Sewer."                                                                                                                 
     Funding for rural Alaska sanitation projects has                                                                           
     declined by over $61 Million, or 64% between 2004 and                                                                      
        · Reduced funding means making choices:                                                                                 
        · First time water and sewer service where feasible                                                                     
        · Upgrades or replacement of existing systems to                                                                        
          address significant health threats                                                                                    
        · Stretching limited funds                                                                                              
        · Prioritize for greatest need and biggest impact                                                                       
Commissioner Hartig  pointed to the  bar graphs on  the slide                                                                   
that  depicted  the  decline  in funding  over  the  last  10                                                                   
2:05:13 PM                                                                                                                    
Commissioner  Hartig moved on  to slide  27: "Alaska  Water &                                                                   
Sewer Challenge."                                                                                                               
     -Innovative international research and development                                                                         
     -Goal is to significantly reduce the capital and                                                                           
     operating costs of in-home running water and sewer in                                                                      
     rural Alaska homes                                                                                                         
     -Recently launched Phase 2                                                                                                 
     -Focus is on "Decentralized" approaches                                                                                    
          -Household based systems                                                                                              
          -Water re-use technologies                                                                                            
     -To date $4 million in State and Federal funds have                                                                        
     been secured, but there may be a future request to                                                                         
     support completion                                                                                                         
Commissioner Hartig  discussed that the  department assembled                                                                   
a  team of  professionals  and  experts  in water  and  sewer                                                                   
systems   who  subsequently   issued  a   RFP  (Request   for                                                                   
Proposal)  to  industry  to develop  innovative  methods  for                                                                   
sewer and  water in rural areas  that were less  expensive to                                                                   
operate.  He detailed that  the department  would choose  the                                                                   
best  ideas and  fund the  resulting  refined pilot  projects                                                                   
and eventually  build some projects for  testing. Essentially                                                                   
the  department was  "leveraging"  a company's  research  and                                                                   
development efforts  to produce a product for  a ready market                                                                   
in  Alaska  and  other Arctic  nations.  The  department  was                                                                   
currently  working  with the  state  department  to make  the                                                                   
challenge  a United  States  project as  part  of the  Arctic                                                                   
Council  and   planning  an  international   conference  that                                                                   
showcased the best ideas that sprang from the challenge.                                                                        
Vice-Chair Saddler  asked whether  there were any  "economies                                                                   
of scale  to be achieved by  having larger village  water and                                                                   
sewage  systems"  or  conversely   were  very  small  systems                                                                   
"tremendously   expensive."  Commissioner  Hartig   responded                                                                   
that  larger   centralized  systems   were  complicated   and                                                                   
expensive.  The challenge  team  was exploring  decentralized                                                                   
systems  for individual  homes  or smaller  subsets of  homes                                                                   
that  would  be   easier  and  cheaper  to   run  in  smaller                                                                   
communities.  He added that  the goal  was to adapt  existing                                                                   
technologies  in new  ways  and he  thought  that the  effort                                                                   
would be successful.                                                                                                            
Co-Chair  Neuman  asked  whether   DEC  was  looking  to  the                                                                   
University  of  Alaska  first, for  innovative  ideas  before                                                                   
seeking  proposals from  outside of  the state.  Commissioner                                                                   
Hartig  responded  that the  university  was  on one  of  the                                                                   
teams,  but added  that  DEC did  not  choose the  university                                                                   
exclusively  because the  department  wanted to  cast a  wide                                                                   
net and  also include  companies and  manufacturers  in order                                                                   
to bring their expertise and money to the table.                                                                                
Vice-Chair  Saddler asked  whether the  smaller systems  were                                                                   
less safe.  Commissioner  Hartig responded  that the  RFP set                                                                   
strict requirements  and that the entire goal  of the program                                                                   
was to meet clean water standards.                                                                                              
2:09:38 PM                                                                                                                    
Commissioner   Hartig  directed   attention   to  slide   28:                                                                   
"Fairbanks Fine Particulate Matter (PM2.5)."                                                                                    
     -Fairbanks/North Pole area exceeds the 24-hour PM2.5                                                                       
     ambient air quality standard                                                                                               
     -Initial air quality plan submitted to EPA on December                                                                     
     31, 2015                                                                                                                   
     -Plan and control options have been controversial in                                                                       
          -Home heating sources (wood and coal) are                                                                             
          important contributors                                                                                                
          -Continued change outs of wood heaters and                                                                            
          expansion of natural gas important to attaining                                                                       
          the standard                                                                                                          
          -Implementing initial plan and working with                                                                           
          community as they explore additional options to                                                                       
          improve air quality                                                                                                   
Commissioner  Hartig elaborated that  the Fairbanks  area was                                                                   
designated    a   "non-attainment"    area    by   the    EPA                                                                   
(Environmental Protection  Agency) due to the  fact that more                                                                   
residents were turning  to wood stoves as energy  costs rise,                                                                   
causing the  air quality  to fail  federal standards.  If the                                                                   
state  could  not  bring  the   area  back  into  attainment,                                                                   
federal sanctions  could be applied making it  more difficult                                                                   
to  spend  other   federal  dollars  in  Fairbanks   and  the                                                                   
withholding highway  funds. He  listed three main  strategies                                                                   
for compliance  that included  a better  supply of  dry wood,                                                                   
more   efficient   stoves   and   boilers,   and   ultimately                                                                   
conversion to liquefied natural gas.                                                                                            
Representative Wilson  stated that other countries  were able                                                                   
to contain  emissions innovatively  and wondered why  DEC was                                                                   
not looking  at other  countries solid  fuel burning  devices                                                                   
for answers.  Commissioner Hartig  answered that  the devices                                                                   
had to  be certified as "compliant"  by the EPA  after import                                                                   
to  the U  S. He  delineated  that the  state  was trying  to                                                                   
press the  EPA to set standards  and create a  methodology to                                                                   
test compliance  for certification,  which was a  complicated                                                                   
and expensive process.                                                                                                          
Representative  Wilson  remarked  that the  devices  existed,                                                                   
particularly in  Canada. She wondered why the  department was                                                                   
not  approaching the  problem  similarly to  the approach  to                                                                   
rural sewer  and water issues. Commissioner  Hartig responded                                                                   
that  DEC did  establish its  own  performance standards  for                                                                   
the non-attainment areas.                                                                                                       
Co-Chair  Thompson commented  about the  millions of  dollars                                                                   
spent   on  the   stove   exchange   programs   as  well   as                                                                   
weatherization.   He   wondered   whether   there   was   any                                                                   
assessment   to  determine   the   programs'   effectiveness.                                                                   
Commissioner   Hartig  responded   that  the   weatherization                                                                   
programs  had  not  had  an impact  on  reducing  wood  smoke                                                                   
emissions and neither had the stove exchange program.                                                                           
Co-Chair  Neuman  noted  that  there were  wood  stoves  with                                                                   
catalytic   convertors  that   reduced  emissions   and  were                                                                   
covered  under   the  weatherization  program.   Commissioner                                                                   
Hartig indicated  that changing out  wood stoves was  not the                                                                   
weatherization  programs'  mission   and  typically  was  not                                                                   
covered under the program.                                                                                                      
2:16:34 PM                                                                                                                    
Commissioner Hartig  advanced to slide 29: "Status  of FY2015                                                                   
Budget Increments."                                                                                                             
     -Federal Authority for Contaminated Sites $959.5 Fed                                                                     
          -Allows   the  Contaminated   Sites  component   to                                                                   
          collect  federal  grants  to  perform  cleanup  and                                                                   
          oversight   of  cleanup  activities   on  federally                                                                   
          owned contaminated sites                                                                                              
          -Federal  budget issues,  including  sequestration,                                                                   
          resulted  in the  Department of  Defense and  other                                                                   
          federal  agencies  not  scaling up  their  clean-up                                                                   
          activities as anticipated                                                                                             
          -Additional  federal grant funding is  uncertain in                                                                   
          -The  Division   expects  to  collect   and  expend                                                                   
          $534.5 of this federal authority in FY2015                                                                            
     -Alaska Gasline Development Corporation (HB4) $106.0                                                                       
          -Allows  for additional  contractors  to work  with                                                                   
          the  Division of  Air Quality  on construction  and                                                                   
          permit applications  related to  the small-diameter                                                                   
          in-state gas pipeline                                                                                                 
          -The Prevention of Significant Deterioration permit as                                                                
          well as one of the Minor Source Specific permits are                                                                  
          anticipated to be submitted during FY2015                                                                             
          -The  Division  expects to   expend $91.6  of  this                                                                   
          increment in FY2015                                                                                                   
Commissioner Hartig moved to slide 30: "Status of FY2015                                                                        
Budget Increments."                                                                                                             
     Regulations: Notice, Review, Comment (HB140) $250.9                                                                        
     UGF+1 PCN                                                                                                                  
          -The Economist III was hired 12/1/2014 in                                                                             
          -The Division expects to fully expend this                                                                            
          increment                 in FY2015                                                                                   
     404 Wetlands Program (SB27)-$1,434.7 UGF -5 PCNs                                                                           
          -The State  has been completing tasks  that were in                                                                   
          progress in FY2014 on a time available basis                                                                          
          -Two  of those  staff  were transferred  to  vacant                                                                   
         PCNs in the wastewater discharge program                                                                               
          -A   third   PCN   has  been   retained   to   work                                                                   
          independently  on an Alaskan wetlands  program plan                                                                   
          (funded  by an  EPA  grant) and  to  work with  the                                                                   
          Army  Corps   of  Engineers  on   streamlining  the                                                                   
          permitting  process, with  a comparable  vacant PCN                                                                   
          deleted to offset this retention                                                                                      
          -RSAs  with DNR  and Law specific  to 404  Wetlands                                                                   
          primacy have been eliminated in FY2015                                                                                
Commissioner Hartig explained slide 31: "Current Challenges                                                                     
to Departmental Performance."                                                                                                   
     Increasing development activity and strained personnel                                                                     
     resources threatens permitting timeliness.                                                                                 
     Burden of new EPA rules threatens drinking water                                                                           
     safety by limiting resources for technical assistance.                                                                     
Commissioner Hartig  noted that the lower bar  graph on slide                                                                   
31  depicted  the  decrease  in  assistance  and  enforcement                                                                   
actions by  DEC due  to budget  reductions. He remarked  that                                                                   
the  department  would limit  the  time spent  on  assistance                                                                   
with  federal  compliance  with  drinking  water  systems  in                                                                   
rural communities  and added that they would have  to turn to                                                                   
the private sector for help.                                                                                                    
Commissioner   Hartig   looked   at  slide   32:   "Long-term                                                                   
Challenges to Departmental Performance."                                                                                        
     Village homes served by safe water:                                                                                        
     •More challenging communities                                                                                              
     •Declining Funding                                                                                                         
     •Increasing Costs                                                                                                          
     •Innovation & Sustainability                                                                                               
     Proposed budget cuts will impact the number of routine                                                                     
     inspections of retail food facilities which may                                                                            
     increase the risk of foodborne illness outbreaks.                                                                          
Commissioner   Hartig  reiterated   the  challenges   to  the                                                                   
Village Safe Water program as depicted on the bar graph.                                                                        
Commissioner  Hartig scrolled  through slide 34:  "Department                                                                   
of  Environmental   Conservation's  Share  of   Total  Agency                                                                   
Operations (GF Only) ($ Thousands)."                                                                                            
Co-Chair  Thompson  asked about  charges  in  regards to  the                                                                   
food safety  inspections. Commissioner Hartig  responded that                                                                   
a fee  was charged  but he was  uncertain whether  it covered                                                                   
the department's  costs. He remarked  that in other  parts of                                                                   
the country  local governments  performed retail  food safety                                                                   
inspections  unlike  Alaska where  only  Anchorage  performed                                                                   
inspections.  He  delineated that  in  remote  areas such  as                                                                   
Nome or  Bethel, in order to  curb costs, DEC  performed food                                                                   
inspections  in conjunction  with  inspections of  commercial                                                                   
food processing  operations acting  in proxy for  the federal                                                                   
Food  and Drug  Administration  (FDA).  Therefore, the  costs                                                                   
were covered by  a mix of federal and state funds  and it was                                                                   
difficult to determine whether the fees covered the costs.                                                                      
Co-Chair  Thompson  wondered  whether  the  department  could                                                                   
increase  the  costs  to cover  food  inspection  similar  to                                                                   
other  types  of  safety  inspections.   Commissioner  Hartig                                                                   
replied that he  would examine whether the  fee structure for                                                                   
inspections  were  constrained  by statute  and  provide  the                                                                   
Representative   Guttenberg  asked   how   the  food   safety                                                                   
inspection  program  worked  in  remote  areas  and  wondered                                                                   
whether contractors  were utilized.  Commissioner  Hartig was                                                                   
not  aware  of  utilizing  contractors  for  inspections.  He                                                                   
explained  that  the  department  issued  food  worker  cards                                                                   
through online  training. The  retail food inspections  where                                                                   
performed  when possible  in conjunction  with travel  to the                                                                   
area for another purpose.                                                                                                       
2:22:46 PM                                                                                                                    
Representative   Guttenberg  further   inquired  about   what                                                                   
happened  with   a  facility   waiting  for  an   inspection.                                                                   
Commissioner Hartig  indicated that a business  could operate                                                                   
without an inspection  and that when inspected  DEC would not                                                                   
close an  establishment unless  an immediate threat  to human                                                                   
health was discovered.                                                                                                          
Representative  Munoz   wondered  whether   communities  with                                                                   
planning and zoning  authorities worked with DEC  to complete                                                                   
a  state  requirement  for  inspection.  Commissioner  Hartig                                                                   
answered that  certain facilities such as  seafood processing                                                                   
plants  or dairies  had  to meet  certain  state and  federal                                                                   
requirements  and the  state  performed  the inspections.  He                                                                   
was not  sure how  much DEC  worked with  the local  planning                                                                   
and zoning authorities.                                                                                                         
Representative Gara  recalled that food inspection  fees were                                                                   
restructured approximately  6 years ago that shifted  more of                                                                   
the fee on the  certified food worker and reduced  the fee on                                                                   
businesses.  He asked  for  clarification  and requested  the                                                                   
amount  of   the  food  inspection  shortfall.   Commissioner                                                                   
Hartig  indicated that  DEC instituted  a nominal  fee for  a                                                                   
food  safety  card  and training.  He  interjected  that  DEC                                                                   
could  only perform  one-third of  the federally  recommended                                                                   
amount of  annual inspections  so the  department decided  to                                                                   
focus  on inspecting  facilities  that  were associated  with                                                                   
the highest risk  to the public such as day  care centers. He                                                                   
noted that,  unlike restaurants the  real risk to  the public                                                                   
was when  a product  went out  to the  public and  the origin                                                                   
was unknown.                                                                                                                    
Representative  Guttenberg  asked if  there  were any  states                                                                   
that  inspected less  restaurants  than Alaska.  Commissioner                                                                   
Hartig noted  that Alaska  was in  an unusual situation  with                                                                   
very large remote areas.                                                                                                        
2:28:39 PM                                                                                                                    
AT EASE                                                                                                                         
2:30:40 PM                                                                                                                    
^FY 16 BUDGET OVERVIEW: ALASKA COURT SYSTEM                                                                                   
DOUG WOOLIVER,  DEPUTY ADMINISTRATIVE DIRECTOR,  ALASKA COURT                                                                   
SYSTEM,  JUDICIARY,  introduced the  PowerPoint  presentation                                                                   
"FY 16 Budget Overview: Alaska Court System."                                                                                   
2:31:23 PM                                                                                                                    
Mr.  Wooliver  explained  the  name  change  from  the  Court                                                                   
System to  Judiciary. The  Judicial Branch  of government  in                                                                   
Alaska was  comprised of  three entities:  The Court  System,                                                                   
the  Judicial   Council,  and  the  Commission   on  Judicial                                                                   
Conduct.  The Court  System  was the  largest  entity of  the                                                                   
three. He  noted that the overview  would focus on  the Court                                                                   
Mr. Wooliver began with slide 2: "Mission Statement."                                                                           
     The mission  of the  Alaska Court  System is  to provide                                                                   
     an  accessible   and  impartial   forum  for   the  just                                                                   
     resolution  of all  cases that  come before  it, and  to                                                                   
     decide   such  cases   in  accordance   with  the   law,                                                                   
     expeditiously and with integrity.                                                                                          
Mr. Wooliver turned to slide 3: "Four Levels of Courts."                                                                        
     -Supreme Court - 5 Justices                                                                                                
     -Court of Appeals - 3 Judges                                                                                               
     -Superior Courts - 42 Judges                                                                                               
    -District Courts - 23 Judges & 52 Magistrate Judges                                                                         
Mr.  Wooliver  explained  the   difference  between  the  two                                                                   
levels  of   trial  courts:  Superior  Courts   and  District                                                                   
Courts.  The  Superior  Court  was  known  as  the  court  of                                                                   
general  jurisdiction  and  heard  cases  regarding  divorce,                                                                   
felony  crime,  child  need  of  aid,  delinquency,  property                                                                   
disputes, etc. The  District Court was known as  the court of                                                                   
limited jurisdiction  and heard  misdemeanors, small  claims,                                                                   
claims under  $100 thousand,  etc. The  District Court  was a                                                                   
high  volume   court.  He  furthered   that  the   state  had                                                                   
magistrate  judges  involved  in  District  Court  and  often                                                                   
served   part-time  in   small  communities   and  were   not                                                                   
typically attorneys.                                                                                                            
Mr.  Wooliver  advanced  to  slide   4:  "Court  System  Non-                                                                   
Judicial Employees."                                                                                                            
     723 Permanent Staff (GF-Funded)                                                                                            
          -In-Court Clerks                                                                                                      
          -Customer Service Clerks                                                                                              
          -Judicial Assistants                                                                                                  
          -Law Clerks                                                                                                           
          -Administrative Staff (HR, Fiscal, Computer                                                                           
          Services, Facilities)                                                                                                 
Mr.   Wooliver   advanced   to   slide   5:   "Distinguishing                                                                   
Characteristics of the Alaska Court System."                                                                                    
     -State Funded                                                                                                              
     -Unified Judiciary- No County or Municipal Courts                                                                          
     -Administrative Director Position Established in the                                                                       
Mr.  Wooliver  pointed  out  that  a  major  advantage  to  a                                                                   
unified Judiciary  was that policy questions  were dealt with                                                                   
by  himself or  Nancy Meade,  General  Counsel, Alaska  Court                                                                   
System, which was  streamlined compared to other  states with                                                                   
local jurisdictions.                                                                                                            
2:35:27 PM                                                                                                                    
Mr.  Wooliver  continued  with slide  6:  "Factors  Impacting                                                                   
Mr.  Wooliver indicated  that  when the  state population  or                                                                   
unemployment rates increased caseloads increased.                                                                               
Mr.  Wooliver discussed  slide  7: "Trial  Court Caseloads  -                                                                   
     132,032 New Cases Filed in FY14                                                                                            
          -59%    of   All    Cases    Originated   in    the                                                                   
          Anchorage/Palmer/Kenai Courts                                                                                         
     Superior Court - 22,523 Cases                                                                                              
          -Probate Cases - 25%                                                                                                  
          -Domestic Relations - 23%                                                                                             
     District Court - 109,509 Cases                                                                                             
Mr.  Wooliver observed  that even  though the  bulk of  cases                                                                   
occurred in  Southcentral Alaska  the Court Systems  policies                                                                   
had to apply to all regions of the state.                                                                                       
Mr. Wooliver  advanced  to the  pie chart  on slide 8:  "FY14                                                                   
Trial Court  Case Filings." He  noted that 44 percent  of the                                                                   
volume of Court  System filings were for minor  offenses, but                                                                   
took up a very small percentage of workload.                                                                                    
Mr.  Wooliver pointed  to the  pie  chart on  slide 9:  "FY14                                                                   
Superior  Court Case  Filings."  He conveyed  that the  chart                                                                   
depicted Superior  Court filings  by case category  which was                                                                   
mostly  criminal followed  by probate  and domestic  relation                                                                   
cases.  He added  that probate  cases regarding  guardianship                                                                   
of elder  Alaskans was steadily  growing. Some  cases dealing                                                                   
with  domestic relations,  such  as child  custody cases  can                                                                   
last for years, but only had one filing.                                                                                        
Mr.  Wooliver moved  on  to slide  10:  "FY14 District  Court                                                                   
Case Filings."  He offered  that the  district court  filings                                                                   
dealt  with  mostly minor  offenses  but  also  misdemeanors,                                                                   
small claims, domestic violence, and civil law.                                                                                 
Vice-Chair  Saddler  asked what  the  timeframe  was for  the                                                                   
case  filing  data  included  in  the  slides.  Mr.  Wooliver                                                                   
responded that they were filings for one year.                                                                                  
Representative  Wilson  asked  whether  minor  offenses  were                                                                   
mostly traffic  offenses that  were not  heard in  court. Mr.                                                                   
Wooliver replied in the affirmative.                                                                                            
Representative  Wilson  requested the  number  of cases  that                                                                   
actually were  heard in district  court. She referred  to the                                                                   
109,509 number of  District Court cases and  thought that was                                                                   
high.  Mr.  Wooliver  replied   that  he  would  provide  the                                                                   
answer.  He  explained  the  electronic   filing  system  for                                                                   
traffic  violations and  stated that  a court employee  never                                                                   
dealt with those cases.                                                                                                         
2:40:59 PM                                                                                                                    
Representative  Munoz  cited the  increasing  involvement  of                                                                   
tribal  courts   and  wondered  whether  that   affected  the                                                                   
court's  workload.  Mr.  Wooliver replied  in  the  negative.                                                                   
However,  he anticipated  that more cases  would be  diverted                                                                   
to tribal courts in the future.                                                                                                 
Mr. Wooliver remembered  that 71 percent of  traffic offenses                                                                   
do not result in court proceedings.                                                                                             
Representative  Wilson   asked  if  the  data   reflected  71                                                                   
percent of the 58,458 minor offenses.                                                                                           
Rhonda  McLeod,   Chief  Financial   Officer,  Alaska   Court                                                                   
System, responded in the affirmative.                                                                                           
Mr. Wooliver continued  with slide 11: "Criminal  Jury Trials                                                                   
     -Superior Court Felony Trials for FY14 are up 21% from                                                                     
    FY12 Trial Totals and up 15% from FY13 Trial Totals                                                                         
     -District Court Misdemeanor Trials for FY14 are up 13%                                                                     
     from FY12 Trial Totals and up 28% from FY13 Trial                                                                          
Mr.  Wooliver  surmised  that   as  the  trial  courts  cases                                                                   
increased  so  did   the  workload  for  the   Court  System,                                                                   
prosecutors,  public  defenders  as  well  as  the  Court  of                                                                   
Appeals  caseload,  which  in  turn  impacted  the  appellate                                                                   
attorneys  in the  Department  of  Law and  Public  Defenders                                                                   
Office workload.                                                                                                                
Representative  Edgmon  referenced  slide  7.  He  asked  why                                                                   
Fairbanks  was  not  included  in the  number  of  new  cases                                                                   
filed.  Mr. Wooliver  responded that  the bulk  of the  cases                                                                   
were  filed  in Southcentral  Alaska.  Representative  Edgmon                                                                   
asked how closure  of the Palmer correctional  facility would                                                                   
affect the  Court Systems'  efforts in  Palmer. Mr.  Wooliver                                                                   
responded  that the closure  would affect  the Department  of                                                                   
Public Safety (DPS) much more than the Court System.                                                                            
Representative Edgmon  commented that potential  cuts in both                                                                   
the  Department  of  Corrections  (DOC) and  DPS  often  just                                                                   
shifted costs from one agency or the other.                                                                                     
2:45:29 PM                                                                                                                    
Co-Chair Neuman  asked what the caseload  percentages between                                                                   
Anchorage   and  the  Matanuska-Susitna   Borough   was.  Mr.                                                                   
Wooliver  confirmed  that Anchorage  had  50 percent  of  all                                                                   
cases  statewide.  He  added  that  Anchorage  had  far  more                                                                   
judges and  far more  cases as well  as the highest  caseload                                                                   
per judge.                                                                                                                      
Representative Gara  referred to slide 11 and  commented that                                                                   
in  the  last  2 to  3  years  the  district  attorneys  were                                                                   
requiring  that  all  sentencing   cases  must  go  to  trial                                                                   
instead of  allowing sentencing  agreements, which  increased                                                                   
the  number  of  trials.  He wondered  whether  some  of  the                                                                   
increase  in felony  trials  resulted  from the  policy.  Mr.                                                                   
Wooliver  responded that  he thought  so  but qualified  that                                                                   
the felony trial  rate had been increasing  before the change                                                                   
in the  plea policy  and was not  sure of  the extent  of the                                                                   
impact on the courts.                                                                                                           
Mr.  Wooliver pointed  to the  graph on  slide 12:  "Criminal                                                                   
Case Dispositions  by Jury Trial Fiscal Years  2009 to 2014,"                                                                   
and  commented  that  the  slide  depicted  the  increase  in                                                                   
Mr.  Wooliver scrolled  to slide  13: "FY15  State of  Alaska                                                                   
Funding  -  All Sources."  He  remarked  that the  pie  chart                                                                   
depicted  that  Judiciary  funding  was 1.4  percent  of  all                                                                   
agency spending.                                                                                                                
Mr. Wooliver identified  slide 14: "Alaska Court  System FY15                                                                   
Operating   Budget   Appropriation   All  Fund   Types."   He                                                                   
mentioned  that the pie  chart represented  the breakdown  of                                                                   
spending  by  appropriation.  He reported  that  the  largest                                                                   
portion of costs belonged to Trial Courts [79 percent].                                                                         
Mr.  Wooliver  advanced  to  slide  15:  "Breakdown  of  FY15                                                                   
Funding (GF)."                                                                                                                  
     -Personal Services Costs - 75.6%                                                                                           
     -Travel Costs - 1.3%                                                                                                       
     -Services - 20.0%                                                                                                          
     -Supplies/Commodities - 2.8%                                                                                               
     -Capital Outlay - .3%                                                                                                      
2:50:34 PM                                                                                                                    
Co-Chair Neuman  asked at what  age a judge could  retire and                                                                   
what  amount  of  compensation   did  a  judge  receive.  Mr.                                                                   
Wooliver responded  that a judge vested in 5  years and could                                                                   
retire  after 15  years  upon  a retirement  age  of 60.  The                                                                   
maximum retirement  rate was 75 percent of  a sitting judge's                                                                   
salary  including health  benefits.  Co-Chair Neuman  thought                                                                   
that  the  rate  encouraged judges  to  retire  and  wondered                                                                   
whether  the Court  System was  reconsidering the  retirement                                                                   
rate for judges.  Mr. Wooliver replied that  the Court System                                                                   
supported the  retirement system for  judges that was  on par                                                                   
with other  judicial retirement  systems across  the country.                                                                   
He  furthered that  most judges  already  had an  established                                                                   
legal career  in the  private sector  and took a  significant                                                                   
salary decrease  to become  a judge,  therefore the  generous                                                                   
retirement  package  acted  as an  incentive.  He  emphasized                                                                   
that the Court System required experienced candidates.                                                                          
In  response  to  a question  by  Representative  Munoz,  Mr.                                                                   
Wooliver  stated that  a judge  would  have to  pay into  the                                                                   
system  for  15  years  to  receive  the  maximum  retirement                                                                   
benefit, could  vest after 5  years, and could  begin drawing                                                                   
retirement  benefits  at  60  years  of  age.  Representative                                                                   
Munoz  asked whether  other  state  service factored  into  a                                                                   
judicial  retirement  and  what   would  happen  if  a  judge                                                                   
retired before the  5 year vestment period.  Mr. Wooliver was                                                                   
uncertain and would provide the answer.                                                                                         
Co-Chair Neuman  asked whether  the Court Systems  retirement                                                                   
unfunded  liability was  included  in the  personal  services                                                                   
costs. Mr.  Wooliver responded  in the affirmative.  He added                                                                   
that the governor  vetoed the unfunded liability  payment the                                                                   
legislature previously appropriated.                                                                                            
2:55:29 PM                                                                                                                    
Vice-Chair Saddler  asked what role geographical  differences                                                                   
played in  retirement benefits.  Mr. Wooliver indicated  that                                                                   
geographical  differences  was   not  a  factor  in  judicial                                                                   
Mr.  Wooliver moved  on to  slide 16:  "Increments Funded  in                                                                   
     -Bandwidth to Improve Network Transmission Speeds                                                                          
     -Facility Maintenance Costs                                                                                                
     -Security Screening                                                                                                        
     -Court Visitors and Interpreters                                                                                           
Mr. Wooliver  discussed the  additional funds for  bandwidth.                                                                   
He identified cost savings by use of video arraignments.                                                                        
Co-Chair  Neuman   asked  whether  the   increased  bandwidth                                                                   
capacity could  be used for  other state needs.  Mr. Wooliver                                                                   
replied  that the  increased  bandwidth  helped  DOC and  DPS                                                                   
through video arraignments.                                                                                                     
Vice-Chair Saddler  asked if there had ever  been a challenge                                                                   
to the adequacy  of video arraignments. Mr.  Wooliver did not                                                                   
know  of any  challenges  and  that video  arraignments  took                                                                   
place every  day. Vice-Chair Saddler asked  whether "anything                                                                   
was  lost"  by  means of  video  arraignments.  Mr.  Wooliver                                                                   
indicated  that  there  might  be situations  that  would  be                                                                   
better  in  person but  a  lot  of routine  proceedings  take                                                                   
place  before   the  court  where   the  use  of   video  was                                                                   
3:00:18 PM                                                                                                                    
Representative  Gattis  asked  whether  it was  possible  for                                                                   
police  officers   to  employ   video  for  mandatory   court                                                                   
appearances. Mr.  Wooliver replied that the suggestion  was a                                                                   
good  one  and  worth  looking  into.  Representative  Gattis                                                                   
remarked  that  improved  bandwidth  offered  potential  cost                                                                   
saving measures  for the  more populated  and urban  areas of                                                                   
the state and not only benefitted rural areas.                                                                                  
Representative  Gara  discussed  the court  calendar  process                                                                   
where many attorneys  and their clients must  appear in court                                                                   
and waste many  hours waiting for deliberation  regarding the                                                                   
status  of  their cases.  He  opined  that the  practice  was                                                                   
antiquated  and wasted  a  lot of  time  for prosecutors  and                                                                   
public defenders.  He wondered  whether there  was a  way the                                                                   
court  clerk could  call  the attorney  near  the time  their                                                                   
case would  be heard in an  effort to utilize  the attorney's                                                                   
productive  work time.  Mr. Wooliver  relayed  that he  would                                                                   
look  into managing  the court  calendar in  ways that  would                                                                   
work better for the attorneys.                                                                                                  
Co-Chair Neuman  commented that  the House Finance  Judiciary                                                                   
Subcommittee would look into the issue.                                                                                         
Mr. Wooliver  discussed  slide 17: "Funding  Changes  FY06 to                                                                   
FY15 Personal Services."                                                                                                        
     -Salary Adjustments                                                                                                        
     -New Judges - Eight Superior Court and Three District                                                                      
     -No Dark Courtrooms Initiative                                                                                             
Mr. Wooliver  reported that 8  new Superior Court  judges and                                                                   
3 new District  Court judges had been added over  the last 10                                                                   
years.  The   "No  Dark   Courtrooms  Initiative"   added  33                                                                   
additional clerical staff.                                                                                                      
Mr. Wooliver  discussed  slide 18: "Funding  Changes  FY06 to                                                                   
FY15 Services."                                                                                                                 
     -Leased Facility Expenses including Public Building                                                                        
     Fund Participation                                                                                                         
     -Utility and Maintenance Costs                                                                                             
     -Software Support & Bandwidth Costs                                                                                        
     -Therapeutic Courts                                                                                                        
Mr.  Wooliver   commented  that   a  new  appropriation   for                                                                   
Therapeutic Courts  was created  and placed within  the Court                                                                   
System  but presented  as an  increase in  the Court  Systems                                                                   
budget. The  appropriation consolidated  of all of  the prior                                                                   
multiple    appropriations   which    reached   into    other                                                                   
departments  and was  not a  true spending  increase for  the                                                                   
Therapeutic Courts.                                                                                                             
3:06:12 PM                                                                                                                    
Representative Guttenberg  stated that he  strongly supported                                                                   
the Therapeutic  Courts.  He noted his  appreciation  for the                                                                   
opportunity to  "shadow" Judge  Raymond Funk, Judge  Pro Tem,                                                                   
Trial Courts  Fairbanks, Judiciary, while presiding  over the                                                                   
Therapeutic  Court  proceedings.  Mr. Wooliver  replied  that                                                                   
there  was a  judicial  ride-a-long program  for  legislators                                                                   
upon invitation  to shadow a judge  for a day which  was very                                                                   
Mr. Wooliver  advanced to slide  19: " Appropriations  within                                                                   
the Judiciary  (All Funds) ($  Thousands)." He  reported that                                                                   
the  graph  portrayed  the  appropriations   for  the  entire                                                                   
Judicial  Branch that was  comprised mostly  of Court  System                                                                   
Mr.  Wooliver reported  on slide  20:  "Judiciary's Share  of                                                                   
Total  Agency   Operations  (GF  Only)  ($   Thousands)."  He                                                                   
elaborated that  the chart  portrayed the Judiciary's  Budget                                                                   
which was 2.21 percent of all agency spending.                                                                                  
Mr. Wooliver turned to slide 21: "Appropriations within the                                                                     
Judiciary (GF Only) ($ Thousands)." He explained that                                                                           
Judiciary was almost exclusively funded with GF.                                                                                
Mr. Wooliver turned to slide 22: "FY16 and Beyond."                                                                             
     Electronic Document Management (E-Filing) Project                                                                          
          -Impact to All Justice Agencies                                                                                       
          -Improve Public Access to Data and Case                                                                               
          -Facilitate Data Exchanges Between Justice                                                                            
          -Improve Case Processing Efficiencies                                                                                 
Mr. Wooliver stated that E-Filing was the future of the                                                                         
Court System and would offer future cost savings by                                                                             
reducing clerical staff and creating efficiencies.                                                                              
Mr. Wooliver reported on slide 23: "FY16 and Beyond…                                                                            
     -In the Near Term, New Superior Court Judges may be                                                                        
     needed for Juneau, Bethel, and Palmer Courts                                                                               
     -In the Long Term, New Judges may be Needed Due to                                                                         
     Population Changes in Southcentral Alaska                                                                                  
3:10:15 PM                                                                                                                    
Mr. Wooliver revealed slide 24: "FY16 and Beyond… (Cont.)."                                                                     
     -Improvement   of   Justice    Facilities   in   Juneau,                                                                   
     Kotzebue, Bethel, and Nome and Additional Space in                                                                         
     -Video Arraignment and Bandwidth Expansion                                                                                 
Mr. Wooliver discussed the court's capital requests that                                                                        
were part of long range plans.                                                                                                  
Mr. Wooliver moved to on slide 25: "FY16 Operating Budget."                                                                     
     -Annual Budget Development Process Commences in August                                                                     
     -FY16 Budget Approved by Supreme Court in October 2014                                                                     
     - Prior to the Severe Decline in Oil Prices                                                                                
     -FY16 Operating Budget Increment Requests Withdrawn                                                                        
     and Base Budget Reduced                                                                                                    
Representative Wilson  thought that judges should  be able to                                                                   
work  longer  than  70  years  of age;  as  mandated  by  the                                                                   
state's constitution.                                                                                                           
Representative  Gara  declared  that  cases  cost  the  state                                                                   
significant amounts  of money. He wondered whether  the Court                                                                   
System considered  increasing court filing fees  on a sliding                                                                   
scale basis.  Mr. Wooliver  indicated  that the Court  System                                                                   
was considering adjusting its fee structure.                                                                                    
Vice-Chair  Saddler wanted  to know how  the courts  measured                                                                   
success  in  the  Court  System   and  particularly  wondered                                                                   
whether the  Therapeutic Courts  was effective.  Mr. Wooliver                                                                   
relayed  that the  measure  for  Therapeutic  Courts was  the                                                                   
recidivism  rate. He  delineated that  recidivism rates  were                                                                   
significantly  lower  for graduates  of  Therapeutic  Courts.                                                                   
Other  measures  of savings  due  to the  Therapeutic  Courts                                                                   
that were  difficult to quantify  were less victims  of crime                                                                   
or less DUI accidents or deaths.                                                                                                
3:17:12 PM                                                                                                                    
Vice-Chair  Saddler requested  the information regarding  the                                                                   
recidivism  rates  related  to  the  Therapeutic  Courts.  He                                                                   
asked whether there  were there objective measures  for Court                                                                   
System  effectiveness  besides  the Therapeutic  Courts.  Mr.                                                                   
Wooliver  voiced that  he could  provide  the committee  with                                                                   
the data from  a recent Judicial Council study  on recidivism                                                                   
related to  the Therapeutic Courts.  He added that  the Court                                                                   
System had a  six month rule statute that  required judges to                                                                   
sign an  affidavit every two weeks  stating that they  do not                                                                   
have work  more than 6 months  old or their pay  is withheld.                                                                   
Vice-Chair   Saddler  requested   more  information   on  the                                                                   
relative  effectiveness   of  the   courts  broken   down  by                                                                   
different regions  of the state. Mr. Wooliver  responded that                                                                   
he would provide the information broken down by district.                                                                       
HB  72   was  HEARD  and   HELD  in  committee   for  further                                                                   
HB  73   was  HEARD  and   HELD  in  committee   for  further                                                                   

Document Name Date/Time Subjects
Judiciary HFIN Overview 2-2-15.pdf HFIN 2/2/2015 1:30:00 PM
DEC HFC Department Overview 02.02.15 (reduced file size).pdf HFIN 2/2/2015 1:30:00 PM