Legislature(2009 - 2010)SENATE FINANCE 532

03/19/2009 09:00 AM Senate FINANCE

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09:09:02 AM Start
09:10:53 AM SB75
10:31:26 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Department of Administration
Military and Veterans Affairs
Department of Corrections
+ Bills Previously Heard/Scheduled TELECONFERENCED
SENATE BILL NO. 75                                                                                                            
     "An Act making and amending appropriations, including                                                                      
     capital appropriations, supplemental appropriations,                                                                       
     and appropriations to capitalize funds; and providing                                                                      
     for an effective date."                                                                                                    
9:10:53 AM                                                                                                                    
DEPARTMENT OF ADMINISTRATION                                                                                                    
Reference Number 47048                                                                                                        
ERIC SWANSON, DIRECTOR, DIVISION  OF ADMINISTRATIVE SERVICES,                                                                   
DEPARTMENT  OF ADMINISTRATION,  began  with reference  number                                                                   
47048 and  the Statewide  System Replacement Project  Request                                                                   
for $76,500,000  of master  lease line  of credit funds.  The                                                                   
purpose  of   the  request  is   to  replace   the  statewide                                                                   
accounting system.  The additional  funding is necessary  for                                                                   
the  massive undertaking  of replacing  access  to the  state                                                                   
accounting  and  state  payroll  systems.  Both  systems  are                                                                   
nearing the  end of their useful  lives and must  be replaced                                                                   
while still functioning.                                                                                                        
Co-Chair  Stedman  expressed   concern  about  utilizing  the                                                                   
master lease line  of credit and the impact  on the operating                                                                   
Mr. Swanson  recalled a conversation  with the  Department of                                                                   
Revenue's  debt manager Devin  Mitchell regarding  financing.                                                                   
He  explained  that the  cost  to  retire  the debt  for  the                                                                   
project  is  $2.2   to  $3  million  in  FY11   including  an                                                                   
additional $13.3 million of debt retirement from FY12-FY18.                                                                     
Co-Chair Stedman asked if there  is ongoing cost comprised of                                                                   
built-in  fees.  Mr.  Swanson  answered  that  the  necessary                                                                   
software  purchase and  licensing  could  present an  ongoing                                                                   
9:14:02 AM                                                                                                                    
KIM  GARNERO, DIRECTOR,  DIVISION OF  FINANCE, DEPARTMENT  OF                                                                   
ADMINISTRATION, stated  that the department  is contemplating                                                                   
licensing products  for software, which generally  run 25% of                                                                   
the licensing fee. She estimated  ongoing license maintenance                                                                   
software fees to run between $15 and $20 million per year.                                                                      
Co-Chair Stedman asked  if the $15 to $20 million  in ongoing                                                                   
expenses were listed  in the budget document. He  did not see                                                                   
the  expense  documented  for  2011  and  2012.  Mr.  Swanson                                                                   
responded  that  the  estimate   was  not  added  as  current                                                                   
estimates  are  between  18-22% of  the  software's  purchase                                                                   
Senator  Thomas asked  who designed the  system. Ms.  Garnero                                                                   
answered  that   the  replacement   systems  have   not  been                                                                   
selected.  She  informed  that  the  procurement  process  is                                                                   
slated to begin in late 2009.  Requirements are documented by                                                                   
state stakeholders.                                                                                                             
Senator  Thomas  asked  if the  department  was  planning  to                                                                   
design the system.  Ms. Garnero responded that  the intention                                                                   
is to buy off  the shelf. She explained that  the majority of                                                                   
states have  moved from the  old system  to an off  the shelf                                                                   
product  such as  PeopleSoft Inc.  a  popular human  resource                                                                   
management systems software solution.                                                                                           
9:17:13 AM                                                                                                                    
Senator  Olson  asked  which departments  are  utilizing  the                                                                   
master lease line  of credit. He asked if the  ability to use                                                                   
the master lease line of credit  was unique to the Department                                                                   
of  Administration  (DOA). He  believed  that  appropriations                                                                   
were made to  other pertinent agencies in the  past and those                                                                   
agencies  used   the  line  of   credit  as  part   of  their                                                                   
operations.  He  offered  to return  to  the  committee  with                                                                   
additional information about the line of credit's history.                                                                      
Mr.  Swanson answered  that  other departments  and  agencies                                                                   
have received  appropriations from  the master lease  line of                                                                   
credit. He recalled  instances where other agencies  used the                                                                   
master lease  line of credit  to fund operations.  He offered                                                                   
to   provide  the   committee  with   research  about   prior                                                                   
Senator Olson expressed concern  about the requested increase                                                                   
and the potential lack of funds.                                                                                                
Co-Chair Stedman  noted that the master lease  line of credit                                                                   
is  present in  various budget  presentations  this year  and                                                                   
moves cash flow call from FY10 into the operating budget.                                                                       
Co-Chair  Hoffman  pointed out  that  the future  expense  is                                                                   
substantial  and  includes  a  request  of  $86  million  for                                                                   
completion by  2015, which places  an additional  burden upon                                                                   
the state budget.                                                                                                               
Co-Chair  Stedman  reminded that  the  state  has a  line  of                                                                   
credit of $50  million, but this issue is separate  and above                                                                   
normal operating procedures of the past.                                                                                        
Senator  Huggins expressed  concern about  the term  debt and                                                                   
the national  economic scene.  He asked  about the  effect of                                                                   
deferring this project during the time of deficit spending.                                                                     
Ms. Garnero asked if Senator Huggins  was proposing deferring                                                                   
the  replacement  of  the  accounting  and  payroll  systems.                                                                   
Senator  Huggins  clarified  that  he was  referring  to  any                                                                   
portion of the $76 million dollars.                                                                                             
Mr.  Garnero   responded  that  the  state  must   begin  the                                                                   
replacement process  as soon as possible to  allow the luxury                                                                   
of smooth  transition to new  payroll and accounting  systems                                                                   
before the current system fails.                                                                                                
9:21:02 AM                                                                                                                    
Senator  Huggins agreed  with  the concept  of replacing  the                                                                   
system, but he felt concern about  potential employee layoffs                                                                   
due to the high cost of the system.  He requested mindfulness                                                                   
about large deficit spending.                                                                                                   
Co-Chair   Hoffman  asked   about  the   time  schedule.   He                                                                   
understood  that the  original  request was  for $72  million                                                                   
over 2010,  2011, and  2012. The current  request is  for $76                                                                   
million in  2010. He asked the  reason for the  time schedule                                                                   
Ms.  Garnero explained  that  the  proposal is  separated  by                                                                   
year.  The  first  year  requires  the  greatest  funding  as                                                                   
licensing fees are required to  bring the new software to the                                                                   
implementation  process.  The  implementation  process  is  a                                                                   
multiyear activity.                                                                                                             
Co-Chair Hoffman  asked if  the expense  might be spread  out                                                                   
along the time frame originally  requested for $50 million in                                                                   
2010 versus $76  million in 2010. He noted  that the original                                                                   
request  for 2011  was  $10 million,  but  now  that cost  is                                                                   
compacted  into the first  year. Ms.  Garnero responded  that                                                                   
the timing was such to optimize the debt placement.                                                                             
Co-Chair Hoffman  asked if the originally  proposed timeframe                                                                   
would  work.   Ms.  Garnero  believed  that   the  originally                                                                   
proposed timeframe would work.                                                                                                  
9:23:42 AM                                                                                                                    
Reference Number 47047                                                                                                        
Mr. Swanson detailed reference  number 47047 and the State of                                                                   
Alaska   Telecommunication  System   Critical  Tower   Repair                                                                   
Upgrade and Maintenance. The requested  funding is to provide                                                                   
for deferred  maintenance for  the state's  telecommunication                                                                   
system enabling the focus on critical upgrades and repairs.                                                                     
Reference Number 47053                                                                                                        
Mr. Swanson addressed  reference number 47053  and the Alaska                                                                   
Public   Offices  Commission   Online   System  Project.   He                                                                   
explained the request  for funding to complete  the web based                                                                   
application  for  the  state's   administration  of  Alaska's                                                                   
disclosure   laws  and  to   publish  financial   information                                                                   
regarding  the  activities  of   election  campaigns,  public                                                                   
officials, lobbyists  and lobbyist employers. The  goal is to                                                                   
move to an entirely electronic environment.                                                                                     
Reference Number 47041                                                                                                        
Mr. Swanson described reference  number 47041 and the Network                                                                   
Communications  and Connectivity  Upgrades. He explained  the                                                                   
request  of   $1.3  million  dollars  to   provide  necessary                                                                   
enhancements and  equipment upgrades to the  state's network,                                                                   
the  data center,  and  the telecommunications  systems.  The                                                                   
request   will   allow   constant   service   and   equipment                                                                   
monitoring, which he opined was important for the network.                                                                      
Co-Chair Hoffman pointed out that  the funding of the request                                                                   
requires commitment  to future  spending. Mr. Swanson  opined                                                                   
that the department would seek  similar levels throughout the                                                                   
9:27:01 AM                                                                                                                    
JIM KOHLER, DEPUTY DIRECTOR, ENTERPRISE  TECHNOLOGY SERVICES,                                                                   
DEPARTMENT OF  ADMINISTRATION stated that the  project is one                                                                   
of  several  required  to update  the  network.  The  current                                                                   
request  is  one portion  of  the  project that  allows  both                                                                   
hardware  and software  along  with a  service contracted  to                                                                   
monitor  equipment with  combined  sites.  He explained  that                                                                   
this is not  a multiyear project, but instead  one of several                                                                   
projects anticipated across the next few years.                                                                                 
Co-Chair Hoffman  asked if the  $1.3 million is  funded would                                                                   
lead  to obligation  to  fund  subsequent years.  Mr.  Kohler                                                                   
answered that the request is for a one time project.                                                                            
Senator Olson  asked if  there would  be another request  for                                                                   
$1.3 million  in 2016. He  asked why  the request was  not in                                                                   
the   operating  budget.   Mr.  Kohler   answered  that   the                                                                   
projection beyond  2015 is not possible. He  relayed a series                                                                   
of costs incurred in the process  of the project development.                                                                   
9:31:14 AM                                                                                                                    
Senator  Huggins asked  the role  of the  Alaska Land  Mobile                                                                   
Radio  (ALMR)  project. Mr.  Kohler  answered  that the  ALMR                                                                   
employs the  state's telecommunication system to  connect all                                                                   
of its  various sites.  He continued that  ALMR is  a project                                                                   
that  utilizes the  state's Information  Technology (IT)  and                                                                   
data  management  systems.  Senator   Huggins  asked  if  the                                                                   
telecommunication  system program  request (reference  number                                                                   
47047) for  $3 million was  part of the integration  process.                                                                   
Mr.  Kohler  responded  that  reference  number  47047  is  a                                                                   
portion  of  the  basic  State  of  Alaska  Telecommunication                                                                   
System  (SATS)  network  for physical  upgrades  required  to                                                                   
bring   the    system   beyond   its   current    maintenance                                                                   
capabilities.  He informed  that  the request  would be  made                                                                   
regardless of the existence of the ALMR system.                                                                                 
9:33:47 AM                                                                                                                    
Senator  Huggins asked  about communities  that opted  out of                                                                   
ALMR? He  wondered if  the project  would address the  system                                                                   
chosen  by   those  communities.  Mr.  Kohler   replied  that                                                                   
Anchorage  built  its  own  emergency   radio  system,  which                                                                   
coordinated with the ALMR project.                                                                                              
Senator  Huggins  asked about  user  fees in  Anchorage.  Mr.                                                                   
Kohler  did not know  who paid  the user  fees in  Anchorage.                                                                   
Senator Huggins  asked about other areas utilizing  ALMR. Mr.                                                                   
Kohler  answered   that  the   ALMR  project  is   built  and                                                                   
maintained in  a consortium manner  with four members  of the                                                                   
project.  The  members  include  Alaska,  the  Department  of                                                                   
Defense, all  the federal agencies  that are not part  of the                                                                   
Department  of Defense,  and  municipalities.  The past  year                                                                   
offered  the opportunity  to project  with specificity  about                                                                   
the  ALMR project.  The consensus  decision  as of  September                                                                   
2008 was  to apportion all  of the maintenance  and operating                                                                   
cost equally on a "per handset" basis.                                                                                          
Senator  Huggins asked  if  the communities  are  cooperating                                                                   
with the  agreement. Mr.  Kohler responded  that the  payment                                                                   
for maintenance and operation  from a user fee basis does not                                                                   
begin until July 1, 2010.                                                                                                       
Senator Huggins asked about the  state's expense in FY08. Mr.                                                                   
Kohler answered  that the combined  contribution in  FY08 was                                                                   
approximately $1.8  million for the maintenance  of equipment                                                                   
and the  network itself.  The Department  of Defense  covered                                                                   
the entire cost of management operations.                                                                                       
9:38:23 AM                                                                                                                    
Senator Huggins asked what the  state share would be in July.                                                                   
Mr. Kohler  answered that  Alaska's state  share of  handsets                                                                   
would be approximately $1.8 million.                                                                                            
Senator Huggins  asked if that  commitment would  change. Mr.                                                                   
Kohler  replied that  the  plan was  state  coverage of  user                                                                   
costs for municipalities  for one year allowing  them to plan                                                                   
for their full participation.                                                                                                   
9:40:00 AM                                                                                                                    
Mr. Swanson noted that reference number 47060 WAS DELETED.                                                                      
Reference Number 47054                                                                                                        
Mr. Swanson addressed  reference number 47054  and the Alaska                                                                   
License  and  Vehicle Information  Network  Replacement.  The                                                                   
project  funding  would  occur  for the  total  cost  of  $10                                                                   
Reference Number 47055                                                                                                        
Mr. Swanson detailed  reference number 47055  and the digital                                                                   
driver license printers. He informed  that this request would                                                                   
enable the replacement of all  digital photographic printers.                                                                   
Reference Number 47052                                                                                                        
Mr.  Swanson   described  reference  number  47052   and  the                                                                   
Combined   Retirement   System   Upgrade.  The   funding   is                                                                   
increasingly important as the retiree population grows.                                                                         
9:43:58 AM                                                                                                                    
Reference Number 47059                                                                                                        
Mr.  Swanson  addressed  reference  number  47059  which  was                                                                   
deleted because  the deferred maintenance was  completed with                                                                   
the prior year's appropriation.                                                                                                 
Co-Chair  Stedman asked  about the governor's  house  and the                                                                   
deleted  improvements.  He asked  if the  improvements  might                                                                   
encourage the governor to live in Juneau.                                                                                       
9:45:58 AM                                                                                                                    
REMOND  HENDERSON,  DEPUTY  DIRECTOR,   DIVISION  OF  GENERAL                                                                   
SERVICES,  DEPARTMENT OF  ADMINISTRATION,  answered that  the                                                                   
intention is to  fund the projects with funds  remaining from                                                                   
the prior year.                                                                                                                 
Co-Chair  Stedman  stated  that  the total  list  equaled  $2                                                                   
million. He asked that for the  information to be provided to                                                                   
the committee. He highlighted  the issues with the governor's                                                                   
mansion and the state museum.                                                                                                   
Reference Number 47058                                                                                                        
Mr.  Swanson   addressed  reference  number  47058   and  the                                                                   
Facilities   Deferred   Maintenance.   He  noted   that   the                                                                   
facilities in  the group include  the State Office  Building,                                                                   
the  Alaska Office  Building,  the Court  Plaza, the  Diamond                                                                   
Courthouse,  and the  Atwood  Building.  This request  occurs                                                                   
annually   to   provide   deferred   maintenance   on   these                                                                   
facilities.  The  funding  is collected  through  the  public                                                                   
building fund.  He pointed out that the  priorities requested                                                                   
change causing projects  to be shifted. The  list of projects                                                                   
is  dynamic  and  the list  presented  to  the  committee  is                                                                   
intended to provide  the total order of  deferred maintenance                                                                   
needed for these  facilities. The annual  request illustrates                                                                   
the capacity anticipated to get the work finished.                                                                              
9:49:54 AM                                                                                                                    
Co-Chair  Stedman noticed  that  the presented  list shows  a                                                                   
need  of  $80  million  yet  the  request  equals  only  $2.8                                                                   
million.  Mr. Swanson responded  that the list is dynamic and                                                                   
provides a  total of what  is expected for these  facilities.                                                                   
Mr. Swanson  noted the  annual request  illustrates  the work                                                                   
that the department deems possible  during an upcoming fiscal                                                                   
year. Co-Chair  Stedman asked if  the possibility was  due to                                                                   
time or resources. Mr. Swanson  answered that both aspects of                                                                   
time  and  money   affect  the  decision.   Co-Chair  Stedman                                                                   
wondered if  the annual  allocation was  a mere $2.8  million                                                                   
with  $80 million  worth of  total projects,  will the  state                                                                   
ever accomplish the deferred maintenance goals.                                                                                 
Mr.   Henderson  pointed   out   that  deferred   maintenance                                                                   
priorities  change  depending   on  environmental  conditions                                                                   
making the  list an evolving one.  He informed that  the list                                                                   
might encompass more or less projects next year.                                                                                
9:52:04 AM                                                                                                                    
Co-Chair Stedman  asked for the  response to the  maintenance                                                                   
of the  governor's mansion.  He understood  that the  mansion                                                                   
was lightly used and he advised  performing needed repairs in                                                                   
an effort to preserve the building.                                                                                             
Mr.  Swanson detailed  reference  number 47040,  and the  DOA                                                                   
enterprise  security  projects.  The funding  requested  will                                                                   
provide several  security projects including  enhancements to                                                                   
the  demilitarized  zone,  auditing   and  compliance,  email                                                                   
discovery, and privacy and server  consolidation for disaster                                                                   
Mr.  Swanson   addressed  reference  number  47051   and  the                                                                   
Document Management System Microfilm  Conversion Phase I. The                                                                   
funding  requested  will provide  for  the migration  of  the                                                                   
Division  of  Retirement and  Benefits  microfilm  documents,                                                                   
which currently exist  on 16mm silver negatives.  The goal is                                                                   
to  digitize  the  information  allowing  preservation.  Some                                                                   
images are  beginning to  fade on the  old media,  leading to                                                                   
concern  about loss  of data.  The new  system provides  much                                                                   
improved search  capabilities which will  infuse efficiencies                                                                   
in the operation.                                                                                                               
9:56:47 AM                                                                                                                    
DEPARTMENT OF MILITARY AND VETERANS AFFAIRS                                                                                     
CRAIG  CAMPBELL, ADJUTANT  GENERAL, COMMISSIONER,  DEPARTMENT                                                                   
OF MILITARY  and VETERANS AFFAIRS announced  reference number                                                                   
42900 and  a request  of $1.7  million of federal  authority.                                                                   
This request is  traditionally made each year.  The funds are                                                                   
used  for maintenance  and construction  operations for  Army                                                                   
guard facilities around Alaska.                                                                                                 
Reference Number 47882                                                                                                        
Mr. Campbell advised  that reference number 47882  be deleted                                                                   
from  the governor's  budget due  to  recommendations to  cut                                                                   
spending. A  future request  will be made  for the  amount of                                                                   
$750  thousand  or increments  of  $250 thousand  over  three                                                                   
years. He pointed out that the  division cannot formally move                                                                   
forward  in  the federal  selection  process  for  validation                                                                   
until the  full $750 thousand  is appropriated by  the state.                                                                   
Due  the budget  situation in  Alaska  the division  requests                                                                   
that the item be deleted.                                                                                                       
10:00:23 AM                                                                                                                   
Senator Huggins  asked if the  Veteran Cemetery Bill  will go                                                                   
into the capital budget.                                                                                                        
Mr. Campbell  answered  that we  do not require  the bill  to                                                                   
submit an  application for the  capital budget, but  only the                                                                   
$750,000. He noted  that the discussed bill  will provide for                                                                   
construction of the cemetery in the future.                                                                                     
Co-Chair Stedman clarified that  only an appropriation to the                                                                   
capital budget is required for construction to begin.                                                                           
Mr. Campbell  informed that the  legislation is  not required                                                                   
for  the appropriation  of  capital  money to  construct  the                                                                   
cemetery. For the state to progress  with the state cemetery,                                                                   
the administration supports legislation  that would encompass                                                                   
the state's role in a state cemetery.                                                                                           
Senator Huggins  stated that  the bill consolidates  funding.                                                                   
He opined  that the bill enhances  the project and  creates a                                                                   
sense of calm in Fairbanks.                                                                                                     
10:02:34 AM                                                                                                                   
Reference Number 35774                                                                                                        
Mr.  Campbell  addressed  reference   number  35774  and  the                                                                   
Military Youth  Academy for Deferred Maintenance  Renewal and                                                                   
Replacement.  He  anticipated that  this  would  be the  last                                                                   
request for  capital improvement as the  final reconstruction                                                                   
will be completed.                                                                                                              
Reference Number 42898                                                                                                        
Mr.  Campbell  addressed  reference   number  42898  and  the                                                                   
National  Guard  Counterdrug  Support and  Ropes  program.  A                                                                   
portion  of  the  program addressed  education  of  youth  in                                                                   
Alaska  through schools,  community events,  and an  obstacle                                                                   
type ropes  program. He  requested authority  to accept  $100                                                                   
thousand from  the federal government  and $50  thousand from                                                                   
state general fund.                                                                                                             
Reference Number 42901                                                                                                        
Mr.  Campbell   addressed  reference  number  42901   for  an                                                                   
estimated $9.5  million from the federal government  into the                                                                   
homeland  security  division. The  funding  is  based on  the                                                                   
allocation from  the federal government. He pointed  out that                                                                   
various states  are working with the Obama  administration to                                                                   
determine how the money is allocated.                                                                                           
Reference Number 43330                                                                                                        
Mr.  Campbell  addressed  reference   number  43330  and  the                                                                   
Estimated Compliance Cleanup Site  Restoration with a request                                                                   
for  authority  to  receive  $17  million  from  the  federal                                                                   
10:07:55 AM                                                                                                                   
DEPARTMENT OF CORRECTIONS                                                                                                       
Reference Number 47567                                                                                                        
LESLIE   HOUSTON,   DIVISION  OF   ADMINISTRATIVE   SERVICES,                                                                   
DEPARTMENT OF  CORRECTIONS, discussed reference  number 47567                                                                   
for  Goose  Creek  Correctional  Center  Utility  and  Energy                                                                   
Construction  Costs.  Due  to  the  revenue  shortfalls,  the                                                                   
original request  of $20  million was  amended to $6  million                                                                   
and spread out over three fiscal years.                                                                                         
Co-Chair  Stedman  asked for  a  little  more detail  on  the                                                                   
original  $20 million  request.  Ms. Houston  noted that  the                                                                   
department   originally   requested   $20   million   as   it                                                                   
represented  the  amount  between  the  revised  construction                                                                   
costs  and the  bond  sales  at the  time.  In  an effort  to                                                                   
downsize due  to the revenue  shortfall, a decision  was made                                                                   
to break the request into smaller pieces.                                                                                       
Senator  Huggins asked  about a prior  appropriation  for $20                                                                   
million that was  vetoed. He requested further  history about                                                                   
the appropriation.                                                                                                              
APRIL  WILKERSON, BUDGET  CHIEF,  DIVISION OF  ADMINISTRATIVE                                                                   
SERVICES,  DEPARTMENT  OF  CORRECTIONS  stated that  the  $20                                                                   
million  item that  was vetoed  for  debt reimbursement.  She                                                                   
requested  time to research  the question  and return  to the                                                                   
committee with  the answer.  Senator Huggins appreciated  the                                                                   
upcoming response.                                                                                                              
Co-Chair  Stedman  asked for  further  information  including                                                                   
details about  the bond sale,  the dates that the  bonds were                                                                   
issued, market  conditions one year previous,  and the market                                                                   
conditions today.                                                                                                               
10:12:29 AM                                                                                                                   
Senator  Huggins commented  that Goose  Creek attracts  doubt                                                                   
from  citizens  regarding the  validity  of the  project.  He                                                                   
expressed  frustration  that  the  project had  not  come  to                                                                   
Senator Olson asked  if there was already a  facility located                                                                   
on the Goose  Creek property. Ms. Houston responded  that she                                                                   
was unsure.  Senator Olson asked  if the facility in  need of                                                                   
renovation  was the  one that  formerly  housed the  reindeer                                                                   
farm. Ms.  Houston admitted  that she  was not familiar  with                                                                   
the area. Senator Huggins added  that the reindeer were gone.                                                                   
He stated  that the  property is the  prison farm  near Goose                                                                   
10:14:48 AM                                                                                                                   
Co-Chair Stedman reiterated the  request for a swift response                                                                   
back to the committee about the bond information.                                                                               
Ms.  Houston   described  reference  number  46994   and  the                                                                   
Fairbanks   Correctional   Center    Space   Renovation   and                                                                   
Remodeling.  The  program  space   within  the  facility  was                                                                   
converted   into  a   38  bed  dorm   space  to   accommodate                                                                   
overcrowding. This  request is  to convert storage  space for                                                                   
the parole and correction officers  in the education programs                                                                   
who were displaced.                                                                                                             
Senator  Thomas asked  if the  rate was  consistent with  the                                                                   
rest of  the state and country  for the individuals  entering                                                                   
the correctional facilities or shipped outside.                                                                                 
Ms. Houston  answered that the Fairbanks  Correctional Center                                                                   
is a  combined facility  serving  as a community  jail  and a                                                                   
prison.  She noted that  combined facilities  tend to  suffer                                                                   
from  overcrowding.  Approaches   are  taken  to  accommodate                                                                   
additional beds without upsetting the facility.                                                                                 
Senator Thomas  recalled that the gymnasium at  the Fairbanks                                                                   
Correctional  Facility recently  housed over  100 people.  He                                                                   
asked about  possible future expansions. Ms.  Houston replied                                                                   
that  the gym  is  currently clear  and  used for  recreation                                                                   
purposes. She stated that there  are some expansion plans for                                                                   
that facility offering future relief.                                                                                           
10:17:36 AM                                                                                                                   
Co-Chair Hoffman asked to know  the time frame for the future                                                                   
expansion   plans.   Ms.   Wilkerson   responded   that   the                                                                   
information  will be  provided to the  committee following  a                                                                   
planning meeting held by the management team.                                                                                   
Co-Chair  Hoffman   stated  that   SB  65  provided   current                                                                   
legislation  allowing  Bethel the  Goose  Creek facility.  He                                                                   
stated  that the  number  one priority  has  been the  Bethel                                                                   
expansion.  He  did  not  see any  requests  to  address  the                                                                   
overcrowding  in the Bethel  facility. Ms. Houston  responded                                                                   
that the  expansion team  is meeting  currently to  develop a                                                                   
report requested  by the legislature  to be distributed  next                                                                   
Co-Chair  Hoffman asked  if a  supplemental  request for  the                                                                   
budget  would  follow  the report.  Ms.  Houston  noted  that                                                                   
without the results from the report  she could not answer the                                                                   
question. Co-Chair Hoffman asked  if the supplemental request                                                                   
might be a future possibility. Ms. Houston answered yes.                                                                        
10:19:50 AM                                                                                                                   
Senator  Huggins  pointed  out  the most  common  theme  with                                                                   
corrections is  the promise of  reports, yet there  is rarely                                                                   
any  change. He  noted  that  the facilities,  concepts,  and                                                                   
costs tend to lead to different directions.                                                                                     
Reference Number 46995                                                                                                        
Ms.  Houston  introduced  reference   number  46995  and  the                                                                   
Medical  Information System  for  $1.5 million  of  Permanent                                                                   
Fund  Dividend  (PFD) criminal  funds.  She noted  the  multi                                                                   
state consortium between Alaska,  Utah, Idaho, and New Mexico                                                                   
to  develop  and   improve  upon  the  existing   system  and                                                                   
implement  the medical  model into  the information  tracking                                                                   
system. Currently  medical files are  in paper form  and must                                                                   
travel  with the  inmate, which  can  occasionally get  lost.                                                                   
This  request  would  bring the  medical  information  online                                                                   
allowing easy access at each facility in the system.                                                                            
Co-Chair Stedman  asked about  PFD fund  source. He  asked if                                                                   
the PFD  receipts  had been adjusted  for any  impact of  the                                                                   
decline in the  dividend. Ms. Houston answered  yes. He asked                                                                   
about  a  statute  passed last  year  allowing  inmate  child                                                                   
support to be paid by the PFD.                                                                                                  
Ms. Houston noted  that this year, due to the  past growth of                                                                   
the Permanent  Fund, was the year  to use the funds.  She was                                                                   
unfamiliar with  the distribution of funds by  the Department                                                                   
of Revenue.  Co-Chair Stedman asked  Ms. Foster to  return to                                                                   
the committee with the answers.                                                                                                 
10:23:19 AM                                                                                                                   
Co-Chair  Hoffman   asked  about  the  past   growth  of  the                                                                   
permanent fund dividend. Is that  growth including the $1,200                                                                   
energy rebate?  Ms. Houston answered that she  was uncertain.                                                                   
She offered to  present the answer along with  the others due                                                                   
to the committee.                                                                                                               
Senator Olson asked about the  medical information system and                                                                   
the  prevention  of  death. Ms.  Houston  answered  that  the                                                                   
medical information system might  assist in the prevention of                                                                   
a death  as past  medical history  is readily identified  and                                                                   
10:24:44 AM                                                                                                                   
Reference Number 47014                                                                                                        
Ms.  Houston   addressed  reference  number  47014   and  the                                                                   
Combined   Highland   Mountain   Correctional   Center   Lead                                                                   
Abatement   and   Buffer   Fence.  She   explained   that   a                                                                   
recreational  trail  system  is encroaching  on  state  land.                                                                   
Approximately 2.5  acres of the  land is an old  firing range                                                                   
containing  lead  contamination in  the  soil  which must  be                                                                   
abated  prior  to an  exchange  of  land with  the  Anchorage                                                                   
municipality.  Also, a  300 foot clear  zone perimeter  fence                                                                   
will be  added next  year to  keep the  public away  from the                                                                   
inside fence.                                                                                                                   
Reference Number 46996                                                                                                        
Ms. Houston addressed reference  number 46996 and the request                                                                   
for an  online electronic  procurement system. Currently  the                                                                   
Department   of   Corrections   has  an   antiquated   manual                                                                   
procurement   process.  The   system   sought  will   provide                                                                   
substantial savings and has the  capability of cataloging and                                                                   
supply management  allowing for competitive  analysis between                                                                   
Reference Number 45637                                                                                                        
Ms. Houston  detailed reference  number 45637 and  the Annual                                                                   
Facilities Maintenance  and Repairs request for  $2.5 million                                                                   
general  funds. The  facilities  are over  27  years old  and                                                                   
require  maintenance and  repair. The  issues listed  are the                                                                   
most critical.                                                                                                                  
Co-Chair  Hoffman requested  the  maintenance list.  Co-Chair                                                                   
Stedman echoed the  interest in the magnitude  and content of                                                                   
the maintenance list. He noted  that the fluidity of the list                                                                   
was also of interest.                                                                                                           
10:28:08 AM                                                                                                                   
Co-Chair Hoffman requested that  the list be prioritized. Ms.                                                                   
Houston added the request to her  list of items to present to                                                                   
the committee.  Co-Chair Stedman  requested the list  once it                                                                   
is prioritized.                                                                                                                 
Reference Number 41515                                                                                                        
Ms.   Houston   addressed   reference    number   41515   for                                                                   
Institutions and Probation and  Parole Equipment Replacement.                                                                   
She identified the  items to be replaced as  metal detectors,                                                                   
food  service  equipment,  and   laundry  facility  equipment                                                                   
strictly to replace old obsolete capital equipment.                                                                             
Reference Number 45248                                                                                                        
Ms. Houston  introduced reference number 45248  Inmate Health                                                                   
Care  Medical and  Dental  Equipment Replacement  request  of                                                                   
$140,400  of  the  PFD criminal  fund  to  replace  essential                                                                   
medical and dental equipment including  hospital beds for the                                                                   
medical segregation unit, microscopes, and a dental chair.                                                                      
Co-Chair Hoffman asked which facilities  were included in the                                                                   
statewide  request.  Ms. Houston  replied  Fairbanks,  Spring                                                                   
Creek, and Anchorage Correction  Facilities will be served by                                                                   
the request.                                                                                                                    
Co-Chair Stedman  asked if Lemon Creek  Correctional Facility                                                                   
required  any upgrades.  Ms. Wilkerson  explained that  Lemon                                                                   
Creek  received  a  dental chair  from  last  year's  capital                                                                   
budget appropriation.                                                                                                           
10:30:31 AM                                                                                                                   
Co-Chair Stedman  asked about  facilities in Western  Alaska.                                                                   
Ms  Wilkerson responded  that  she would  provide  a list  of                                                                   
facilities  that received  updated equipment  last year.  The                                                                   
current request  is to provide the remaining  facilities with                                                                   
the rest of the equipment needs.                                                                                                
Co-Chair Stedman  reminded about the list and  the imperative                                                                   
prioritization  of the  order. Ms.  Wilkerson understood  the                                                                   
request and promised to comply.                                                                                                 
SB75   was  HEARD   and  HELD   in   Committee  for   further                                                                   
10:31:26 AM                                                                                                                   

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