Legislature(2003 - 2004)

04/27/2004 09:02 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                                                                                                                                
     SENATE BILL NO. 65                                                                                                         
     "An  Act authorizing  the Department  of  Corrections to  enter                                                            
     into agreements with  municipalities for new or expanded public                                                            
     correctional  facilities in the  Fairbanks North Star  Borough,                                                            
     the Matanuska-Susitna  Borough, Bethel, and the Municipality of                                                            
     Anchorage."                                                                                                                
                                                                                                                                
                                                                                                                                
This  was the third  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken  explained  that  this  bill  would  authorize  the                                                            
Department  of Corrections  to enter into  25-year lease  agreements                                                            
for additional  State correctional  beds with the Matanuska-Susitna                                                             
(Mat-Su) Borough, the Fairbanks  North Star Borough, Bethel, and the                                                            
Municipality of Anchorage.                                                                                                      
                                                                                                                                
Co-Chair  Green, the bill's  sponsor, expressed  that for more  than                                                            
four years,  she has  been advocating  for the  construction  of new                                                            
prisons  in the  State.  Discussions  have occurred  regarding  both                                                            
public   and  private   operated   facilities.   Contrary  to   most                                                            
discussions that place  private and public facilities in competition                                                            
with each other,  this legislation  would provide an opportunity  to                                                            
construct  new facilities  in the State without  advocating  for one                                                            
side  or the  other.  No  expansion  would occur  were  the  current                                                            
competitive  situation  to continue.  Some facilities  in the  State                                                            
operate at  one hundred percent capacity  on an on-going  basis, and                                                            
were this to continue,  it could present "a crisis" and a "dangerous                                                            
situation."                                                                                                                     
                                                                                                                                
AT EASE 10:10 AM / 10:11 AM                                                                                                     
                                                                                                                                
Co-Chair  Green  moved  to adopt  the  Version  23-LS0392\C  as  the                                                            
working document.                                                                                                               
                                                                                                                                
Co-Chair Wilken objected for explanation.                                                                                       
                                                                                                                                
Co-Chair Green  explained that Version  "C" would expand  the bill's                                                            
title to include  private prisons in the City of Whittier,  provided                                                            
the State could  not provide the service at the same  or lower cost.                                                            
In addition,  the bill's  title would  also be  expanded to  provide                                                            
consideration to the City of Dillingham and Kodiak's jails.                                                                     
                                                                                                                                
Co-Chair  Green  pointed out  that  the bill  would  also provide  a                                                            
termination  date  of July  1,  2009 as  specified  in  the bill  in                                                            
Section  1 on  page  two, lines  six  and nine.  By this  time,  the                                                            
Commissioner  of  the  Department  of  Corrections   must  authorize                                                            
construction  of the facilities on  the public side. Subsection  (2)                                                            
of Section  1 would allow for an increase  in the maximum  number of                                                            
beds that could be constructed in the Mat-Su Borough facility.                                                                  
                                                                                                                                
Co-Chair  Green noted that  new language  referencing a third  party                                                            
contractor  for a prison facility  in the City of Whittier  has been                                                            
added as reflected  by the entirety of Section 2,  beginning on page                                                            
three, line  five. She specified  that the  City of Whittier  prison                                                            
construction  must be  authorized by  July 1, 2006.  She also  noted                                                            
that  before  the project  could  be awarded  to  a third  party,  a                                                            
feasibility  study must  be conducted  in order  to affirm that  the                                                            
State  could not  perform  these services  for  the  same or  lesser                                                            
amount. Section 2 would  also mandate that a competitive bid process                                                            
be implemented  when awarding the  City of Whittier prison  facility                                                            
project to a third  party and that the City of Whittier  must adhere                                                            
to  the State  procurement  process  for  the acquisition  of  land,                                                            
design, construction,  and operation  of the facility. Furthermore,                                                             
the Commissioner  must approve the  facility design before  entering                                                            
into an agreement. Approval  of design, efficiency, safety measures,                                                            
and building  standards is necessary  as there is always  the chance                                                            
that a facility constructed  by a borough or city might, "in a short                                                            
period of time be turned over to the State."                                                                                    
                                                                                                                                
Co-Chair Green also noted  that the Whittier prison would be limited                                                            
to approximately  2,200 beds. Language in Section  2, subsection (4)                                                            
on page four,  beginning on page 15  is identical to language  in HB
55-CORRECTIONAL  FACILITIES  pertaining  to the  agreement with  the                                                            
City of Whittier.                                                                                                               
                                                                                                                                
Co-Chair  Green noted  that Section  3, on page  four, beginning  on                                                            
line 23 is also  new language. It would specify that,  in regards to                                                            
the construction  of a prison facility  in the cities of  Dillingham                                                            
and Kodiak,  the  State would  match the  expenditure  of the  local                                                            
entity by issuing a certificate of participation (COP).                                                                         
                                                                                                                                
Co-Chair  Green pointed  out  that new  Section 4,  located on  page                                                            
five,  beginning  on line  11,  would  provides  further  parameters                                                            
regarding the  State's COP agreement  with the cities of  Dillingham                                                            
and Kodiak. The  anticipated annual operating costs  associated with                                                            
providing  the additional  beds at  each facility  are specified  in                                                            
Section 4, line 24.                                                                                                             
                                                                                                                                
Co-Chair Green pointed  out that language in Section 6, on page six,                                                            
line   six  repeals   language   that   the   Legislature   approved                                                            
approximately  six years prior regarding  the Kenai facility,  which                                                            
was not furthered.                                                                                                              
                                                                                                                                
Co-Chair Green  stated that the difficult  aspect of developing  the                                                            
Department of Corrections  "draft" fiscal note, dated April 27, 2004                                                            
[copy  on  file]  was that  while  most  fiscal  notes  reflect  new                                                            
expenses,  the  Department  was  required  to  factor  out  expenses                                                            
associated  with  housing  inmates outside  of  the State.  This  is                                                            
further  explained  in the  fiscal note  analysis.  Inmates who  are                                                            
currently housed  in Arizona would be housed within  the State as of                                                            
the year  2009, and as a  result, that $13  million expense  must be                                                            
removed  from the  total $43  million expense  in  order to  compare                                                            
figures. The resulting  $27 million net expense would better reflect                                                            
the  true  cost  of increasing  the  number  of  in-State  beds.  In                                                            
addition,  some prison  facilities  in Palmer  might  be closed  and                                                            
operations moved  to a new facility. This would "allow  for a better                                                            
management" of funds.                                                                                                           
                                                                                                                                
Co-Chair Green  urged the Committee to realize that  each new "tough                                                            
on crime" bill  approved by the Legislature  would further  increase                                                            
the State's prison  population. In addition, each  new State Trooper                                                            
and new  State prosecutor  would also increase  the number  of those                                                            
who might be incarcerated.  One area that is also  authorized in the                                                            
bill, but  that was not  thoroughly discussed,  is the expansion  of                                                            
the federally  funded Municipality  of Anchorage  jail. The  City of                                                            
Seward is also  interested in requesting that its  number of beds be                                                            
increased.                                                                                                                      
                                                                                                                                
Co-Chair Green commented  that a forthcoming amendment would address                                                            
a  technical  error in  the  bill  and a  separate  amendment  would                                                            
address  Alaska  police  standard  certification   requirements  for                                                            
prison guards as this issue  is not currently addressed in the bill.                                                            
                                                                                                                                
Co-Chair Wilken removed his objection.                                                                                          
                                                                                                                                
There  being  no  further  objection,  the  Version   "C"  committee                                                            
substitute was ADOPTED as the working document.                                                                                 
                                                                                                                                
Amendment  #2:  This  technical  amendment   changes  $1,500,000  to                                                            
$2,000,000  to correct  a drafting error  in Section  4, line  14 on                                                            
page five of the Version "C" committee substitute.                                                                              
                                                                                                                                
Co-Chair Green moved for adoption.                                                                                              
                                                                                                                                
There being no objection, Amendment #2 was ADOPTED.                                                                             
                                                                                                                                
MARC ANTRIM, Commissioner,  Department of Corrections,  informed the                                                            
Committee  that,  while this  "compromised"  legislation  would  not                                                            
provide all the  remedies that are desired, both the  Department and                                                            
Governor  support its  passage  as the  need for  additional  prison                                                            
"housing is so  great." He detailed the growth in  prison population                                                            
numbers,  as reflected  in  the Department's  chart  titled  "Inmate                                                            
Population Statistics"  [copy on file], and commented  that there is                                                            
no indication  that  the increasing  prison population  trend  would                                                            
change. Were the current  rate of prison population increase and the                                                            
current circumstances  to continue,  it is anticipated that  half of                                                            
State's inmate population would be housed outside of the State.                                                                 
                                                                                                                                
DEE HUBBARD,  Resident  of Sterling,  testified  via teleconference                                                             
from Anchorage and applauded  the efforts exerted in the development                                                            
of  the  committee   substitute,   specifically  the  inclusion   of                                                            
procurement  code  language  and the  inclusion  of the  Kodiak  and                                                            
Dillingham jail components.  She urged the Committee to consider the                                                            
addition of Statute language,  as adopted by other states, regarding                                                            
private  prison contract  monitoring,  compliance  auditing, use  of                                                            
force  guidelines, contract  enforcement  and fines,  and  emergency                                                            
notification   plans  to  include  such  things   as  who  would  be                                                            
responsible  for expenses associated  with searching for  an escaped                                                            
inmate.  These types  of things  should be incorporated  into  State                                                            
Statute. She  could provide pertinent  information to the  Committee                                                            
in these regards.                                                                                                               
                                                                                                                                
Co-Chair Green  asked Ms. Hubbard to provide the information  to her                                                            
office.                                                                                                                         
                                                                                                                                
LINDA  FREED,   City  Manager,   City  of   Kodiak,  testified   via                                                            
teleconference  from  Kodiak  and  thanked the  bill's  sponsor  for                                                            
providing   the  City  the   opportunity   to  participate   in  the                                                            
development of the committee  substitute. The focus of her testimony                                                            
would be  the financing of  the City's proposed  jail facility.  She                                                            
noted that  the City currently  operates the  jail on a contractual                                                             
basis with the  State in an old contractor's office/garage  building                                                            
that was  built in the  1940s. The building,  which also houses  the                                                            
City's police  department, is unsafe  and expensive to operate.  The                                                            
City  has  committed  to  constructing  a  new  20  or  22-bed  jail                                                            
facility, probably  at the same site, at an estimated  cost of up to                                                            
$3.5 million.  The City  "already subsidizes  the operation"  of the                                                            
current jail facility even  though the contract with the State is in                                                            
effect. The proposed 50-50  State/local match that would be required                                                            
to construct  the new State  jail facility  would exceed the  City's                                                            
fiscal ability.  However,  construction would  be possible  were the                                                            
City able to secure a three  million dollar bonded indebtedness. The                                                            
City has  made a  commitment to  the bill's sponsor  "that they  are                                                            
willing to bond  and pay for the construction costs  of the facility                                                            
up  front." At  the  current  four-percent  interest rate,  a  three                                                            
million dollar  twenty-year bond indebtedness  annual payback  would                                                            
be $220,745. Therefore,  the request is that the State  would assist                                                            
the City  in finding  "a  mechanism" through  which  the City  could                                                            
"construct a new  jail for the State of Alaska" and  assist the City                                                            
in satisfying  the  bonded indebtedness  debt  "up to  a maximum  of                                                            
three million dollars."                                                                                                         
                                                                                                                                
TC  KAMAI,  Chief  of Police,  City  of  Kodiak  Police Department,                                                             
testified via teleconference  from Kodiak regarding the difficulties                                                            
the  City faces  in operating  the  current aging  and "deplorable"                                                             
facility; particularly  in regards to meeting the standards required                                                            
by the State contract.  He likened the escalating annual maintenance                                                            
expenses of  the facility "to putting  band-aids on an open  wound."                                                            
The jail must be replaced.                                                                                                      
                                                                                                                                
Senator Olson  asked regarding the jail's incarceration  statistics.                                                            
                                                                                                                                
Chief Kamai responded that  the monthly occupancy rate of the 16-bed                                                            
facility is 80-percent.  This morning the jail held  13 individuals.                                                            
                                                                                                                                
Senator Olson asked for a total number per year.                                                                                
                                                                                                                                
Chief Kamai  responded that the jail  houses an average of  1,200 to                                                            
1,300 incarcerations per year.                                                                                                  
                                                                                                                                
SENATOR  GARY  STEVENS  thanked the  bill's  sponsor  for  including                                                            
community jails  in the committee substitute. Though  his experience                                                            
as a former City  of Kodiak Mayor, he could attest  to the condition                                                            
of the  City jail,  the oldest jail  in the State.  He stressed  the                                                            
timeliness of  this legislation, as the City is moving  forward with                                                            
its plans to replace  the jail with a multi-public  safety building.                                                            
He applauded  the City's  willingness to  commit to paying  up-front                                                            
for the building,  and supported the  City's request that  the State                                                            
commit to assisting with the building's associated bond service.                                                                
                                                                                                                                
PHIL  SHEALY,   City  Manager,   City  of   Seward,  testified   via                                                            
teleconference  from Seward  and shared that  the City supports  the                                                            
committee   substitute's    "comprehensive   package    to   address                                                            
correctional  facility  needs  in  the  State for  years  to  come."                                                            
However,  the  one  missing  component  is that  of  addressing  the                                                            
State's  maximum-security  facility needs.  Therefore, he  requested                                                            
that  expansion  of the  City of  Seward's  Spring Creek  Prison  be                                                            
considered in that regard.                                                                                                      
                                                                                                                                
WILLARD DUNHAM,  City Council Member, City of Seward,  testified via                                                            
teleconference  from Seward and reminded  the Committee that,  while                                                            
the  Spring Creek  facility  can currently  house  350 inmates,  the                                                            
building  and the  site  were designed  to  allow for  an  expansion                                                            
ability to house  700. He noted that this could be  accomplished for                                                            
a reasonable amount.  Therefore, he requested that  this facility be                                                            
added into the  feasibility study language. He also  stated that the                                                            
facility  currently  houses   500  inmates  and  site  expansion  is                                                            
required. The Department  of Corrections would support the expansion                                                            
of maximum-security improvements at the site.                                                                                   
                                                                                                                                
                                                                                                                                
SFC 04 # 96, Side A 10:38 AM                                                                                                    
                                                                                                                                
                                                                                                                                
Mr.  Dunham noted  that  the bonds  that were  sold  to support  the                                                            
construction  of this facility would  be paid off in the  year 2006,                                                            
and, in light  of the current interest rate level,  he stressed that                                                            
this would  be a  good time to  reissue those  bonds. Another  valid                                                            
reason to expand  the facility is  the fact that Seward is  the site                                                            
of the Alaska Vocational  & Technical Institute, which could provide                                                            
training for correctional  officers and inmates. Therefore, he urged                                                            
the Committee  to include the community of Seward  in the bill as he                                                            
assured the Committee that  the City would be willing "to assist the                                                            
Department  on all fronts." The only  thing negative about  the bill                                                            
is  the fact  that  the  City  of Seward'  prison  facility  is  not                                                            
included.                                                                                                                       
                                                                                                                                
Senator G. Stevens  agreed that the Spring Creek facility  should be                                                            
considered  in this legislation as  it is the only maximum-security                                                             
facility  in the  State and  has been  designed  for expansion.  The                                                            
facilities currently incorporated  into the bill are medium security                                                            
or lower,  and pre-sentencing  facilities.  He therefore urged  that                                                            
the facility be included.                                                                                                       
                                                                                                                                
Co-Chair Green  noted that further amendments would  be forthcoming.                                                            
                                                                                                                                
Co-Chair  Wilken ordered  the  bill HELD  in Committee  for  further                                                            
consideration.                                                                                                                  
                                                                                                                                
[Note: SB 65 was re-addressed later in the meeting.]                                                                            
                                                                                                                                
RECESS 10:41 AM / 4:04 PM                                                                                                       
                                                                                                                                
                                                                                                                                
     SENATE BILL NO. 65                                                                                                         
     "An  Act authorizing  the Department  of  Corrections to  enter                                                            
     into agreements with  municipalities for new or expanded public                                                            
     correctional  facilities in the  Fairbanks North Star  Borough,                                                            
     the Matanuska-Susitna  Borough, Bethel, and the Municipality of                                                            
     Anchorage."                                                                                                                
                                                                                                                                
                                                                                                                                
[Note: This bill was heard earlier in the meeting.]                                                                             
                                                                                                                                
Co-Chair Wilken noted that  the bill was again before the Committee.                                                            
                                                                                                                                
Amendment  #3: This  amendment inserts  new language  into the  bill                                                            
title  on page  one,  line  one, following  "An  Act."  The  amended                                                            
language would read as follows.                                                                                                 
                                                                                                                                
     An Act relating to  correctional officers, parole officers, and                                                            
     probation officers;…                                                                                                       
                                                                                                                                
In addition,  the bill inserts  new bill sections  into the  bill on                                                            
page one, following line twelve, as follows.                                                                                    
                                                                                                                                
     Section 1. AS 18.62.290(2) is amended to read:                                                                             
          (2) "correctional officer" means a person                                                                             
                (A) appointed by the commissioner of corrections                                                              
     whose primary duty  under AS 33.30 is to provide custody, care,                                                            
     security,  control,   and  discipline  of  persons  charged  or                                                            
     convicted   of  offenses  against  the  state   or  held  under                                                            
     authority of state law; or                                                                                               
                (B) employed in a correctional facility in this                                                               
     state  whose   primary  duty  is  to  provide  custody,   care,                                                          
     security,  control,   and  discipline  of  persons  charged  or                                                          
     convicted of offenses or held under authority of law;                                                                    
     Sec. 2. AS 18.65.290(5) is amended to read:                                                                              
          (5) "parole officer" means a person appointed by the                                                                  
     commissioner  of  corrections  or employed  by  a correctional                                                           
     facility  in this state  to perform  the duties of supervising                                                           
     the parole of prisoners under AS 33.16;                                                                                    
     Sec. 3. AS 18.65.290(7) is amended to read:                                                                                
          (7) "probation officer" means a person appointed by the                                                               
     commissioner  of  corrections  or employed  by  a correctional                                                           
     facility  in this state  to perform the  duties of a  probation                                                          
     officer under AS 33.05.                                                                                                    
                                                                                                                                
     New Text Underlined [BRACKETED TEXT DELETED]                                                                             
                                                                                                                                
Other changes resulting  from this amendment are: deleting "$14,600"                                                            
and replacing  it  with "$11,600"  on page  two,  line 25;  deleting                                                            
"sec.  4" and replacing  it  with "sec.  7" on page  four, line  29;                                                            
deleting "sec. 4" and replacing  it with "sec. 7" on page five, line                                                            
nine; and deleting  "sec. 3" and replacing it with  "sec. 6" on page                                                            
five, line 14 and on page five, line 31.                                                                                        
                                                                                                                                
Co-Chair  Green moved to  adopt the amendment.  She noted that  this                                                            
amendment would  incorporate standards  into the bill pertaining  to                                                            
staff training  and certification.  In addition, she noted  that the                                                            
amendment  would also  present  a technical  change  to correct  the                                                            
annual  maximum allowable  lease  payment per  bed at  a new  prison                                                            
facility.                                                                                                                       
                                                                                                                                
Senator  Dyson  asked  whether  State  statutes  currently   contain                                                            
adequate screening  procedures or  training for prison chaplains  as                                                            
there was a recent news  report regarding inappropriate conduct of a                                                            
State prison chaplain.                                                                                                          
                                                                                                                                
MARK  ANTRIM, Commissioner,  Department  of  Corrections,  responded                                                            
that even were  more stringent screening in place,  "there are still                                                            
bad people"  and bad things  could happen.  The Department  supports                                                            
the  prison chaplaincy  program.  Furthermore,  he  shared that  the                                                            
chaplain in  question had more than  twenty years of experience  and                                                            
had been highly recommended.                                                                                                    
                                                                                                                                
Senator  Dyson  asked  whether  the  Department  might  require  any                                                            
additional  statutory authority  in regards  to the prison  chaplain                                                            
program.                                                                                                                        
                                                                                                                                
Commissioner Antrim responded no.                                                                                               
                                                                                                                                
There being no objection, Amendment #3 was ADOPTED.                                                                             
                                                                                                                                
Co-Chair Green  noted that Amendment #4 would not  be offered as its                                                            
contents were embodied in Amendment #3.                                                                                         
                                                                                                                                
Amendment #5:  This amendment deletes  the word "and" in  the bill's                                                            
title on page one line three.                                                                                                   
                                                                                                                                
In addition,  the bill's title is  further amended to read,  on page                                                            
one, line four, as follows.                                                                                                     
                                                                                                                                
     Anchorage and the City of Seward; relating to the development                                                              
     and financing of privately operated correctional….                                                                         
                                                                                                                                
Furthermore  the amendment  also inserts a  new subsection  into the                                                            
bill on page two, line five as follows.                                                                                         
                                                                                                                                
     (5) Seward - expansion of the existing Spring Creek                                                                        
     Correctional Center by up to 144 beds.                                                                                     
                                                                                                                                
Senator B.  Stevens moved to adopt  Amendment #5, at the  request of                                                            
Senator Gary Stevens.                                                                                                           
                                                                                                                                
Co-Chair Wilken objected for explanation.                                                                                       
                                                                                                                                
Senator B. Stevens read the amendment.                                                                                          
                                                                                                                                
Senator  Gary Stevens  explained that  the City  of Seward's  Spring                                                            
Creek  Correctional  Facility  is  the  most logical  locale  for  a                                                            
maximum-security  facility expansion,  as it  is currently  the only                                                            
maximum-security  prison in  the State and,  as it was designed  for                                                            
expansion, it would be the most economical choice.                                                                              
                                                                                                                                
Co-Chair Green  suggested that the  amendment be changed  to further                                                            
reflect the  distinction between a  public and private correctional                                                             
facility.                                                                                                                       
                                                                                                                                
Co-Chair Wilken  stated that the language in Amendment  #5 should be                                                            
reworked.                                                                                                                       
                                                                                                                                
Amendment-to-Amendment  #5: This friendly amendment to the amendment                                                            
changes the originally proposed language as follows.                                                                            
                                                                                                                                
The language "and  the City of Seward;" is inserted  into the bill's                                                            
title on page one, line four, following the word "Anchorage".                                                                   
                                                                                                                                
In  addition,  for consistency  purposes,  the  words  "City of"  is                                                            
inserted  before  the word  "Seward"  in  new subsection  (5)  being                                                            
offered. This language would read as follows.                                                                                   
                                                                                                                                
     (5)  City of Seward  - expansion of  the existing Spring  Creek                                                            
     Correctional Center by up to 144 beds.                                                                                     
                                                                                                                                
Co-Chair Wilken moved to amend Amendment #5.                                                                                    
                                                                                                                                
Senator  Olson suggested  that consideration  be given to  including                                                            
the City of Kotzebue prison facilities in the legislation.                                                                      
                                                                                                                                
Co-Chair Wilken  asked that Senator  Olson consider presenting  that                                                            
issue as a separate amendment.                                                                                                  
                                                                                                                                
There  being  no  objection,  the  Amendment  to  Amendment  #5  was                                                            
ADOPTED.                                                                                                                        
                                                                                                                                
Co-Chair Wilken offered  a motion to adopt Amendment #5, as amended.                                                            
                                                                                                                                
There being no objection, Amendment #5, as amended, was ADOPTED.                                                                
                                                                                                                                
Amendment  #6: This  amendment deletes  all material  in Section  4,                                                            
page five,  lines 13 through 17 and  replaces it with the  following                                                            
language.                                                                                                                       
                                                                                                                                
     MUNICIPAL  JAIL FACILTIES. (a)  Each of the following  projects                                                            
     is  approved   to  receive  $3,000,000   of  the  proceeds   of                                                            
     certificates  of participation authorized under  sec. 3 of this                                                            
     Act,  on the  condition  that the  municipality,  in which  the                                                            
     project is located,  provides all funds over this amount needed                                                            
     for  the  upgrade,   expansion  or  replacement   of  the  jail                                                            
     facilities.                                                                                                                
                                                                                                                                
In addition, language in  Section 4, subsection (a)(2) on page five,                                                            
line 21 is amended to read as follows.                                                                                          
                                                                                                                                
     existing 16-bed facility with a new facility up to 22 beds.                                                              
                                                                                                                                
     New Text Underlined [BRACKETED TEXT DELETED]                                                                             
                                                                                                                                
Senator B. Stevens moved to adopt Amendment #6.                                                                                 
                                                                                                                                
Co-Chair Wilken and Co-Chair Green objected                                                                                     
                                                                                                                                
Senator  B. Stevens  explained  that the  effect  of this  amendment                                                            
would be to increase the  amount of the Certificate of Participation                                                            
(COP) from  two million to  three million  dollars. In addition,  he                                                            
noted that  any expenses  above this  amount to  upgrade, expand  or                                                            
renovate a facility  would be borne by the municipality.  The effect                                                            
of this language would be to remove the State match language.                                                                   
                                                                                                                                
Senator B. Stevens  continued that the amendment would  also provide                                                            
a  technical  change  to qualify  that  the  current  16-bed  Kodiak                                                            
Community Jail  would be replaced with up to a new  22-bed facility.                                                            
                                                                                                                                
Co-Chair  Green  stated  that  the  original   proposal  would  have                                                            
required  a  50-percent   State/municipality   match  with  a  total                                                            
projected per  facility maximum of  four million dollars.  She noted                                                            
that upon further  review, it was  determined that construction  for                                                            
proposed  new jail  facilities  would cost  less  than four  million                                                            
dollars. Therefore,  the legislation was changed to  specify a State                                                            
maximum  expenditure  of two  million dollars  and  a local  maximum                                                            
expenditure of  $1.5 million. With the understanding  that the local                                                            
municipality  would use  these funds  to construct  a new jail,  the                                                            
State would sign a contract  specifying that it would be responsible                                                            
for the operating costs of the facility on a long-term basis.                                                                   
                                                                                                                                
Co-Chair  Green  continued  that  historically  when  a State/local                                                             
participation  agreement is in place, more participation  on part of                                                            
the local entity  has been required.  Therefore, in this  situation,                                                            
the State,  and in particular, the  Legislature, has agreed,  "to be                                                            
more generous" in its participation  commitment. She stated that the                                                            
goal  is  to  make  local  jail facility   projects  affordable  and                                                            
incorporate local participation.                                                                                                
                                                                                                                                
Co-Chair  Green appreciated  the  local community  representatives'                                                             
comments regarding  their willingness to improve their  local prison                                                            
facilities;   however,  she  asserted   that  the  intent   of  this                                                            
legislation  was to  have  local participation  and  have the  State                                                            
assist  in  providing  funding  without  burdening  the  State.  She                                                            
advised that the  funding streams for the local prison  enhancements                                                            
would be  "a different  funding stream" than  normally utilized  for                                                            
prisons "when entities  go to bond" and arrange "for the State to do                                                            
the  lease/purchase  on  the  other  facilities."  She  warned  that                                                            
careful  consideration  must be applied  to this  endeavor as  other                                                            
communities  might come  forward and  ask that  the State  construct                                                            
prison   facilities  in   their  communities   with  limited   local                                                            
participation.  She stressed  that while this  would be a  Committee                                                            
policy  call, the intent  would be  to not have  a State  commitment                                                            
that "we cannot afford."                                                                                                        
                                                                                                                                
Co-Chair  Wilken  understood  that  were the  existing  language  in                                                            
effect, the community of  Dillingham would be required to provide at                                                            
least  $1.5  million  toward  construction   of  a  new  jail.  Were                                                            
Amendment #6 adopted, the  State's obligation would be three million                                                            
dollars  and the City  of Dillingham  would be  responsible for  any                                                            
expense above the three million dollar amount.                                                                                  
                                                                                                                                
Co-Chair Green concurred.                                                                                                       
                                                                                                                                
Co-Chair  Wilken understood,  therefore,  that were  the project  to                                                            
cost three million dollars  or less, the community would receive the                                                            
facility "au gratis."                                                                                                           
                                                                                                                                
Co-Chair Green  affirmed. In addition,  she stated that adoption  of                                                            
the amendment  would also require  further changes in the  committee                                                            
substitute in that the  $4,000,000 amount specified in Sec. 3, lines                                                            
28  and  30  on  page  four  must  be  changed  to  $6,000,000.  She                                                            
reiterated that  adoption of this amendment would  serve to increase                                                            
"State exposure."                                                                                                               
                                                                                                                                
Commissioner  Antrim noted that he  could not comment in  regards to                                                            
the amendment, as it is not in his field of expertise.                                                                          
                                                                                                                                
Senator G. Stevens  appreciated Co-Chair Green's comments  regarding                                                            
the affordability of the  project and the local participation issue.                                                            
He stressed that the City  of Kodiak would be willing to provide the                                                            
upfront  costs of  constructing  a new  22-bed, $3.5  million  jail;                                                            
however, he voiced that  the City would appreciate knowing what base                                                            
level the State  would commit to in  regards to the debt  service as                                                            
the City would  be obligating to bond the total project  and pay any                                                            
associated expenses  above that specified amount.  He noted that the                                                            
annual debt  payment is projected  to be approximately $220,000  per                                                            
year  for the duration  of  the bond.  In addition,  he stated  that                                                            
separate,  annual  operating  costs  would be  associated  with  the                                                            
project.  He reminded  the  Committee  that  the City  is  currently                                                            
paying approximately  $3,000 more, annually, than  what the State is                                                            
contributing  for  the  current  Kodiak   jail.  In  conclusion,  he                                                            
stressed that,  "there is a disinclination for the  City council" to                                                            
invest "that much money into a State jail."                                                                                     
                                                                                                                                
Senator Hoffman  stated that since  consideration is being  given to                                                            
changing the language  regarding the capacity of the  Kodiak jail to                                                            
be  "up  to 22-beds,"  he  would  consider  proposing  that  similar                                                            
language be applicable to the Dillingham jail.                                                                                  
                                                                                                                                
Co-Chair  Wilken  asked that  that  component  of the  amendment  be                                                            
addressed  after  the portion  of  the amendment  dealing  with  the                                                            
financial arrangement is rectified.                                                                                             
                                                                                                                                
Senator Hoffman suggested that the amendment be divided.                                                                        
                                                                                                                                
Co-Chair  Wilken  noted that  a separate  amendment  addressing  the                                                            
Dillingham jail could be submitted for consideration.                                                                           
                                                                                                                                
Co-Chair  Green  asked  regarding  the  process  undertaken  by  the                                                            
Department of  Corrections for projecting operating  costs for local                                                            
jail facilities;  specifically whether the contracts  were developed                                                            
on a cost  per day basis.  It would be in  the best interest  of the                                                            
State to keep local facilities viable.                                                                                          
                                                                                                                                
Commissioner Antrim responded  that each local contract is developed                                                            
on  an  annual  basis,  based  on a  variety  of  factors  for  each                                                            
community.  While the Department  does have  negotiating  abilities;                                                            
this ability is subject  to Legislative appropriation. He also noted                                                            
that, "any  increases  awarded to  this program  over the years  has                                                            
been done so proportionately"  to the original level,  and that, "in                                                            
some cases, there was not  a lot of rational basis for some of those                                                            
figures."                                                                                                                       
                                                                                                                                
Co-Chair  Green asked  the Commissioner  whether  other communities                                                             
might come forward with  a request for inclusion, were this language                                                            
adopted.                                                                                                                        
                                                                                                                                
Commissioner Antrim responded that this could be possible.                                                                      
                                                                                                                                
Co-Chair  Wilken  declared that  were  this amendment  adopted,  the                                                            
State might "have three million dollar jails all over State."                                                                   
                                                                                                                                
Senator B. Stevens offered a motion to withdraw the amendment.                                                                  
                                                                                                                                
There  being   no  objection,  Amendment   #6  was  WITHDRAWN   from                                                            
consideration.                                                                                                                  
                                                                                                                                
Co-Chair  Wilken ordered  the  bill HELD  in Committee  in order  to                                                            
further consider this and other amendments.                                                                                     
                                                                                                                                
[NOTE: This bill was addressed later in the meeting.]                                                                           
                                                                                                                                
                                                                                                                                
     SENATE BILL NO. 65                                                                                                         
     "An  Act authorizing  the Department  of  Corrections to  enter                                                            
     into agreements with  municipalities for new or expanded public                                                            
     correctional  facilities in the  Fairbanks North Star  Borough,                                                            
     the Matanuska-Susitna  Borough, Bethel, and the Municipality of                                                            
     Anchorage."                                                                                                                
                                                                                                                                
                                                                                                                                
[Note: SB 65 was heard two times previously in this meeting.]                                                                   
                                                                                                                                
Co-Chair Green reminded  the Committee that, earlier in the meeting,                                                            
an amendment had been offered  but withdrawn from consideration that                                                            
would change  the bill's  language regarding  the State's and  local                                                            
entity's  financial commitment  regarding  the  construction of  new                                                            
jail facilities in Kodiak and Dillingham.                                                                                       
                                                                                                                                
Co-Chair  Wilken   clarified  that   the  referenced  amendment   is                                                            
Amendment #6.                                                                                                                   
                                                                                                                                
Amendment  #6: This  amendment deletes  all material  on page  five,                                                            
Section 4,  lines 13 through 17 and  replaces it with the  following                                                            
language.                                                                                                                       
                                                                                                                                
     MUNICIPAL  JAIL FACILTIES. (a)  Each of the following  projects                                                            
     is  approved   to  receive  $3,000,000   of  the  proceeds   of                                                            
     certificates  of participation authorized under  sec. 3 of this                                                            
     Act,  on the  condition  that the  municipality,  in which  the                                                            
     project is located,  provides all funds over this amount needed                                                            
     for  the  upgrade,   expansion  or  replacement   of  the  jail                                                            
     facilities.                                                                                                                
                                                                                                                                
In addition, language in  Section 4, subsection (a)(2) on page five,                                                            
line 21 is amended to read as follows.                                                                                          
                                                                                                                                
     existing 16-bed facility with a new facility up to 22 beds.                                                              
                                                                                                                                
     New Text Underlined [BRACKETED TEXT DELETED]                                                                             
                                                                                                                                
TOM  BOUTIN,   Deputy  Commissioner,   Department  of  Revenue   and                                                            
Spokesman,  State Bond Committee,  commented that that he  had never                                                            
"seen  State debt  issued with  a kicker  from any  entity" be  it a                                                            
municipality  or any other.  The fact that  a municipality  would be                                                            
contributing something  akin to "a credit enhancement or money for a                                                            
State project"  would not be a matter of consideration  to the State                                                            
Bond Committee  or the Department of Revenue, as he  understood that                                                            
all of these projects would constitute a State lease debt.                                                                      
                                                                                                                                
Co-Chair  Green   interjected  that   rather  than  this   amendment                                                            
pertaining to State lease/purchase  debt, it would apply strictly to                                                            
the operating  expenses associated  with the  Kodiak and  Dillingham                                                            
jails.                                                                                                                          
                                                                                                                                
Co-Chair  Wilken  understood that  the  amendment would  pertain  to                                                            
construction  costs of the  facilities as  opposed to the  operating                                                            
costs.                                                                                                                          
                                                                                                                                
Co-Chair Green  understood "that the payment the State  makes is for                                                            
operating costs."                                                                                                               
                                                                                                                                
Mr. Boutin responded that  the entirety of the projects specified in                                                            
the Version "C"  committee substitute would qualify  for State lease                                                            
debt and therefore would  be rated on the State's credit. "Whether a                                                            
leased project is a capital  lease or an operating lease relies upon                                                            
financial   accounting  standards   for  Rule  13."  Therefore,   he                                                            
considered  all the projects  as State lease  debt and that  some of                                                            
the projects  have "a credit enhancement  of a municipality  kicking                                                            
in some  money." He  reiterated that  he had never  seen this  done,                                                            
"anywhere in the nation"  or the State of Alaska. This does not mean                                                            
that it  "is a bad  thing," but  he opined that  attorneys would  be                                                            
required  "to craft" the  language, as, were  a municipality  to use                                                            
their  general  obligation  ability to  fund  their portion  of  the                                                            
money, the  project would  be considered "part  of the security  for                                                            
the debt and  there "would have to  be a clear segmentation  so that                                                            
the general  obligation of the municipality  didn't run to  the part                                                            
of the project that the municipality was funding."                                                                              
                                                                                                                                
Co-Chair Wilken voiced  that, under the bill's current language, the                                                            
State would  provide, upfront,  a two million  dollar capital  grant                                                            
with an expectation  of a $1.5 million grant being  forthcoming from                                                            
the municipality. Amendment  #6 would change the language to provide                                                            
three million dollars in  State funding with no expectation of local                                                            
match funding.                                                                                                                  
                                                                                                                                
Senator  B. Stevens  stated  that the  amendment  would establish  a                                                            
three million  dollar ceiling  on the State's  participation  in the                                                            
municipality's  construction  of a  local  jail, and  that any  cost                                                            
above that would  become the responsibility of the  municipality. He                                                            
pointed  out that in  Section 3,  subsection (a)  of the bill,  page                                                            
five, lines  one and two, the total  rental obligation of  the State                                                            
on an  annual basis  would be limited  to $400,000.  He stated  that                                                            
this might  be the issue  that Co-Chair Green  is referring  to when                                                            
"saying that the  maximum obligation that the State  would be on the                                                            
line  for would  be  the  $400,000  and the  municipality  would  be                                                            
responsible for  the reimbursement for the debt retirement  of three                                                            
million."                                                                                                                       
                                                                                                                                
Mr. Boutin  replied that currently  there is no financial  structure                                                            
like that available.  Continuing,  he re-emphasized that  this would                                                            
be recognized  as State lease  debt, which  is rated on the  State's                                                            
credit.  He  stated  "the State's  credit  would  be  the  principle                                                            
enhancement,  but he reiterated that  "the project itself  is always                                                            
part of the  credit" in order to provide  the bond holders  with the                                                            
ability,  "in the  event of  a non-appropriation,"  to  take over  a                                                            
portion of the project.                                                                                                         
                                                                                                                                
Senator B. Stevens recalled  that the question regarding the rewrite                                                            
of the original  language is whether Amendment #6  would require the                                                            
monetary amount  to be increased to $6,000,000 in  Section 3 on page                                                            
four, line  27 and the $4,000,0000  amount  on line 30 of that  same                                                            
section to be increased to $8,000,000.                                                                                          
                                                                                                                                
Co-Chair Green concurred.                                                                                                       
                                                                                                                                
Mr. Boutin replied that it would require a linear change.                                                                       
                                                                                                                                
Senator  B.  Stevens  understood  therefore  that  were $3,000,0000                                                             
specified for each of the  Kodiak and Dillingham projects, the total                                                            
amount  required  would  be  $6,000,000.   The  total  cost  of  the                                                            
financial commitment would not exceed $8,000,000.                                                                               
                                                                                                                                
Mr. Boutin  shared that one of the  three financial rating  agencies                                                            
has expressed  that the State should not commit to  a maturity lease                                                            
debt term exceeding 15-years.                                                                                                   
                                                                                                                                
Senator B.  Stevens asked  whether the City  of Kodiak or the  State                                                            
would repay the bond debt reimbursement.                                                                                        
                                                                                                                                
Ms. Freed  stated that, due  to the fact that  this is a State  jail                                                            
operated  by the City  of Kodiak,  the premise is  that the  City of                                                            
Kodiak  would bond  for the  total  construction  costs through  the                                                            
City's general  obligation bonding  capacity with the understanding                                                             
that the  State would  repay  the debt service  up  to a maximum  of                                                            
three million  dollar total construction  costs. She clarified  that                                                            
the City would  be responsible for  any construction expense  beyond                                                            
the three million dollar amount.                                                                                                
                                                                                                                                
Senator B. Stevens expressed that this clarifies the issue.                                                                     
                                                                                                                                
Co-Chair Green  understood the City  of Kodiak's position.  However,                                                            
she  shared  that historically  when  a  local  entity bonds  for  a                                                            
project,  a  State   lease/purchase  agreement   is  in  place  that                                                            
specifies  that the city  would own the building  until the  debt is                                                            
paid. Continuing,  she stated that this arrangement  would differ in                                                            
that, while the  City of Kodiak or Dillingham would  secure the bond                                                            
and agree to  pay anything beyond  the State's three million  dollar                                                            
obligation, when  the project were paid off, the City  would own the                                                            
facility.  She  expressed  therefore,  that there  are  two  funding                                                            
mechanisms  in this bill, as, with  the exception of the  Kodiak and                                                            
Dillingham jails, the State would own the facilities.                                                                           
                                                                                                                                
Co-Chair  Green  asked  whether  the  current   jail  facilities  in                                                            
Dillingham  and  Kodiak  are  counted  against  the  State's  credit                                                            
rating.                                                                                                                         
                                                                                                                                
Mr.  Boutin  responded  in the  negative.  He  reiterated  that,  as                                                            
written, all the projects  in this bill would be recognized as State                                                            
debt, regardless  of whether or not the lessee owns  the facility at                                                            
the end  of the lease term.  Continuing, he  stated that this  could                                                            
result  in meeting  one of four  criteria  in Rule  13 in which  the                                                            
lessee, not  the leasor, "is on the  hook." Therefore, he  concluded                                                            
that regardless of whether  the City of Kodiak utilizes its GO bonds                                                            
to  fund  the construction   of the  jail  facility,  the  bill,  as                                                            
drafted, revolves around State lease debt.                                                                                      
                                                                                                                                
Co-Chair Wilken understood  that this is because of the Certificates                                                            
of Participation specified in the bill.                                                                                         
                                                                                                                                
Mr. Boutin  responded that  this is because  the lease term  clearly                                                            
meets one of  four criteria for financial  accounting standards  for                                                            
Rule 13.                                                                                                                        
                                                                                                                                
                                                                                                                                
SFC 04 # 97, Side A 05:37 PM                                                                                                    
                                                                                                                                
                                                                                                                                
Co-Chair Green recalled  that during a conversation she had with the                                                            
Standard  & Poor credit  rating company  regarding what constituted                                                             
State debt,  they had asked what the  State is doing to house  State                                                            
prisoners. She  informed them that the State is paying  to have them                                                            
housed  in   a  facility  in  Arizona.   They  responded   that  the                                                            
construction  of  a prison  within  the State  to house  those  same                                                            
prisoners would  not be counted against  the State bonding  capacity                                                            
because its operating money  that is currently being spent and which                                                            
"would be spent in the  future." Therefore, she suggested that since                                                            
the State is  currently housing prisoners  in Kodiak and  Dillingham                                                            
that  this  would  constitute  "only  an  addition  to  the  current                                                            
facility." She  stressed that more bed space has been  identified as                                                            
being necessary  in Kodiak and, therefore,  the State would  only be                                                            
paying  for an  increase of  six beds  at that  facility. She  asked                                                            
therefore   whether  the  "replacement   facility  "  term   is  the                                                            
determining factor in regards  to whether the State should simply be                                                            
paying for six new beds.                                                                                                        
                                                                                                                                
Mr. Boutin responded  that were the State to address  this situation                                                            
in a manner  similar to that of housing  prisoners in Arizona,  then                                                            
the Certificate of Participation  language, lease language, and bond                                                            
proceeds should  not be components of the bill. He  stated that were                                                            
the City of  Kodiak to utilize GO  bonding to build a facility  that                                                            
would be  open to housing  any entities'  prisoners, then,  he would                                                            
agree that it would not be considered State debt.                                                                               
                                                                                                                                
Co-Chair  Wilken  asked  the  relationship  of  this  discussion  to                                                            
Amendment #6.                                                                                                                   
                                                                                                                                
Senator  B. Stevens  responded  that the  issue being  discussed  is                                                            
"embodied in  the bill itself;" whereas  the amendment would  simply                                                            
serve to change numbers  in the bill. He explained that the adoption                                                            
of Amendment  # 2 served to increase  the amount of the proceeds  of                                                            
the certificates  of participation.  This would again be  amended by                                                            
the adoption  of Amendment #6. However,  Mr. Boutin's testimony  has                                                            
served to  address issues  embodied in the  body of the bill  rather                                                            
than relating to Amendment #6.                                                                                                  
                                                                                                                                
Co-Chair Wilken  understood that Amendment #6 would  allow the State                                                            
to  issue certificates  of  participation  to build  an under-three                                                             
million dollar  jail anywhere in the  State were one desired  by the                                                            
municipality,  with no local contribution  requirement. Continuing,                                                             
he stated that the Version  "C" committee substitute states that the                                                            
State would assist  a municipality to build a $3.5  million facility                                                            
of  which  the  local  municipality  responsibility  would  be  $1.5                                                            
million.                                                                                                                        
                                                                                                                                
Co-Chair  Wilken   concluded  therefore,  that  were   amendment  #6                                                            
adopted,  there   would  be  $3  million  jails  being  constructed                                                             
everywhere in the State.                                                                                                        
                                                                                                                                
Senator B.  Stevens responded that  the Amendment raises  a question                                                            
in regards  to  Section 3,  page five,  lines two  and three,  which                                                            
specifies a $6,000,000  limit on the total COP payment. He therefore                                                            
understood  that  the language  in  Amendment  #6 would  require  an                                                            
additional  change in that  regard as the  $6 million dollar  amount                                                            
would only provide  funding for the Kodiak and Dillingham  projects.                                                            
                                                                                                                                
Co-Chair  Green  agreed  that   the  $6 million   amount  should  be                                                            
increased to allow  that any other municipality wishing  to pursue a                                                            
new jail facility  be provided for,  as she declared, were  no local                                                            
match participation  required,  this would  be very "attractive"  to                                                            
many communities.                                                                                                               
                                                                                                                                
Senator  Hoffman countered  that  the bill's  language specifically                                                             
identifies to which communities the proposal would apply.                                                                       
                                                                                                                                
Senator  Hoffman   requested  that  consideration   be  provided  to                                                            
dividing  one  portion  of the  Amendment  into  two parts:  one  to                                                            
address  language  in Section  4 Subsection  (1)  and  the other  to                                                            
address Section (4) Subsection (2) as affected by Amendment #6.                                                                 
                                                                                                                                
Co-Chair  Green argued that  the costs associated  with these  jails                                                            
has not  been calculated  on  an "up to"  a certain  number of  beds                                                            
basis, but  rather that  the costs were  calculated to specifically                                                             
reflect the  costs associated  with a 22-bed  Kodiak facility  and a                                                            
25-bed Dillingham  facility.  Therefore, she  stated that she  would                                                            
concur were the intent  to express the entirety of the expenses in a                                                            
per bed manner.                                                                                                                 
                                                                                                                                
Senator Hoffman  pointed out  that were the  amendment adopted,  the                                                            
details relating  to the  Kodiak and Dillingham  jails would  not be                                                            
consistent  as one would  specify "up to"  a certain number  of beds                                                            
and the other would not.                                                                                                        
                                                                                                                                
Co-Chair Wilken  ordered Amendment  #6 to be divided into  Amendment                                                            
6A and 6B.                                                                                                                      
                                                                                                                                
Amendment  #6A: This amendment  deletes all  material on page  five,                                                            
Section 4,  lines 13 through 17 and  replaces it with the  following                                                            
language.                                                                                                                       
                                                                                                                                
     MUNICIPAL  JAIL FACILTIES. (a)  Each of the following  projects                                                            
     is  approved   to  receive  $3,000,000   of  the  proceeds   of                                                            
     certificates  of participation authorized under  sec. 3 of this                                                            
     Act,  on the  condition  that the  municipality,  in which  the                                                            
     project is located,  provides all funds over this amount needed                                                            
     for  the  upgrade,   expansion  or  replacement   of  the  jail                                                            
     facilities.                                                                                                                
                                                                                                                                
Co-Chair Wilken  asked whether this amendment could  result in there                                                            
being three  million dollar jails  constructed all around  the State                                                            
in the years to come.                                                                                                           
                                                                                                                                
Commissioner  Antrim voiced that this  is "a valid concern"  in that                                                            
the State  would be financing  their construction.  In addition,  he                                                            
reminded  that this  amendment applies  to local  rather than  State                                                            
jail facilities.                                                                                                                
                                                                                                                                
Co-Chair Wilken  stated therefore  that the State would be  required                                                            
to pay to have State prisoners held in that local facility.                                                                     
                                                                                                                                
Commissioner  Antrim affirmed that  the basis of the community  jail                                                            
program is  that the State  contract with  the local entity  to hold                                                            
State prisoners.                                                                                                                
                                                                                                                                
Co-Chair  Wilken asked whether  the cost  per prisoner differs  from                                                            
community to community based on the local economics.                                                                            
                                                                                                                                
Commissioner  Antrim affirmed that  operating costs are a  factor in                                                            
the amount paid.                                                                                                                
                                                                                                                                
Co-Chair Green  informed "that every other community  jail is a city                                                            
jail: the State did not  build them, the State pays operating costs,                                                            
and should not have to build non-State owned facilities."                                                                       
                                                                                                                                
Senator B. Stevens  stated that Amendment #6A would  simply serve to                                                            
change  the  ceiling  embodied  in  the bill.  In  response  to  the                                                            
argument that the State  would be building $3 million jails all over                                                            
the State, it could be  argued that the State would be building $3.5                                                            
million jails  all over the State of which $2 million  would be paid                                                            
for by the State. Therefore,  he opined that the amendment would not                                                            
change  what is  embodied  in the  bill with  the  exception of  the                                                            
required match  and the level to which the State would  participate.                                                            
                                                                                                                                
Co-Chair  Wilken   remarked  that   the  issue  pertains   to  local                                                            
participation.                                                                                                                  
                                                                                                                                
Co-Chair   Green   reminded   that  the   original   estimates   for                                                            
constructing  the Kodiak  and Dillingham  jails  were approximately                                                             
$3.5 million.  The State's two million dollar commitment,  which she                                                            
declared lowered local  participation to less than half of the total                                                            
amount,  was considered  "very, very  generous."  While it could  be                                                            
argued that  increasing the  amount to three  million dollars  would                                                            
not  be  significantly   more,  that   increase  would  negate   the                                                            
requirement  for the local  participation.  She voiced concern  that                                                            
this amendment "keeps this section from working."                                                                               
                                                                                                                                
Senator B. Stevens moved to adopt Amendment #6A.                                                                                
                                                                                                                                
Co-Chair Green objected.                                                                                                        
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Senator B. Stevens                                                                                                    
                                                                                                                                
OPPOSED:  Senator Dyson,  Senator  Hoffman, Senator  Olson,  Senator                                                            
Bunde, Co-Chair Green, and Co-Chair Wilken                                                                                      
                                                                                                                                
The motion FAILED (1-6)                                                                                                         
                                                                                                                                
Amendment #6A FAILED to be adopted.                                                                                             
                                                                                                                                
Amendment  #6B:  This  amendment   amends  language  in  Section  4,                                                            
subsection (a)(2) on page five, line 21 to read as follows.                                                                     
                                                                                                                                
     existing 16-bed facility with a new facility up to 22 beds.                                                              
                                                                                                                                
     New Text Underlined [BRACKETED TEXT DELETED]                                                                             
                                                                                                                                
Senator B. Stevens moved to adopt Amendment #6B.                                                                                
                                                                                                                                
Co-Chair Wilken and Co-Chair Green objected.                                                                                    
                                                                                                                                
Co-Chair  Green would  be willing  to work  with  the Department  of                                                            
Revenue and the  various involved communities to develop  the proper                                                            
language pertaining to this section.                                                                                            
                                                                                                                                
Senator Dyson asked Co-Chair Green to summarize her concern.                                                                    
                                                                                                                                
Co-Chair  Green explained  that the calculations  pertaining  to the                                                            
costs of the facilities  are based on a total bed  count rather than                                                            
an up-to bed count scenario.  The concern is that were no additional                                                            
beds added when  constructing a new Kodiak jail, the  State would be                                                            
required to pay  the amount stated in the bill that  pertains to the                                                            
larger number.                                                                                                                  
                                                                                                                                
Commissioner  Antrim affirmed that  the numbers denoted in  the bill                                                            
are precise numbers.                                                                                                            
                                                                                                                                
Amendment  to Amendment #6B:  This amendment  to the amendment  adds                                                            
the words "up to" before  "25-bed facility" in Section 4, Subsection                                                            
(a) (1) on page  five, line 19 that pertains to the  Municipality of                                                            
Dillingham.                                                                                                                     
                                                                                                                                
Senator Hoffman moved to adopt the amendment-to-the-amendment.                                                                  
                                                                                                                                
Co-Chair Wilken objected.                                                                                                       
                                                                                                                                
Senator B. Stevens pointed out that language in Section 1, page                                                                 
two, lines three through 30 is consistent with the language                                                                     
proposed in the amendment to the amendment.                                                                                     
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Senator B. Stevens, Senator Bunde                                                                                     
                                                                                                                                
OPPOSED: Senator Hoffman, Co-Chair Green, Senator Dyson, and Co-                                                                
Chair Wilken                                                                                                                    
                                                                                                                                
ABSENT: Senator Olson                                                                                                           
                                                                                                                                
The motion FAILED (2-4-1)                                                                                                       
                                                                                                                                
The motion to adopt the Amendment-to-Amendment #6B FAILED to be                                                                 
adopted.                                                                                                                        
                                                                                                                                
AT EASE: 6:00 PM / 6:01 PM                                                                                                      
                                                                                                                                
Due to Committee confusion regarding the subject of the previous                                                                
roll call vote, Co-Chair Green moved to rescind the Committee                                                                   
action.                                                                                                                         
                                                                                                                                
There being no objection, Committee action on the Amendment-to-                                                                 
Amendment #6B was RESCINDED.                                                                                                    
                                                                                                                                
Senator Hoffman moved to adopt the Amendment-to-Amendment #6B.                                                                  
                                                                                                                                
Co-Chair Wilken objected.                                                                                                       
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Senator B. Stevens, Senator Hoffman, and Senator Olson                                                                
                                                                                                                                
OPPOSED: Senator Bunde, Senator Dyson, Co-Chair Green, and Co-Chair                                                             
Wilken                                                                                                                          
                                                                                                                                
The motion FAILED (3-4)                                                                                                         
                                                                                                                                
The action to adopt Amendment-to-Amendment #6B FAILED.                                                                          
                                                                                                                                
Amendment #6B was again before the Committee.                                                                                   
                                                                                                                                
Co-Chair Wilken maintained his objection to Amendment #6B.                                                                      
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Senator B. Stevens and Senator Bunde                                                                                  
                                                                                                                                
OPPOSED:  Senator Hoffman,  Senator Dyson,  Co-Chair Green,  and Co-                                                            
Chair Wilken                                                                                                                    
                                                                                                                                
ABSENT: Senator Olson                                                                                                           
                                                                                                                                
The motion FAILED (2-4-1)                                                                                                       
                                                                                                                                
Amendment #6B FAILED to be adopted.                                                                                             
                                                                                                                                
Co-Chair Wilken ordered the bill HELD in Committee.                                                                             
                                                                                                                                

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