Legislature(2003 - 2004)

03/02/2004 03:33 PM Senate STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
          SB 352-MANAGERS NOT EMPLOYEES UNDER P.E.R.A.                                                                      
CHAIR GARY STEVENS  announced SB 352 to be  up for consideration.                                                               
He  asked  Mr.  Jardell  to continue  his  presentation  that  he                                                               
started at the last hearing.                                                                                                    
KEVIN    JARDELL,   assistant    commissioner,   Department    of                                                               
Administration, noted  that at the  previous hearing  he outlined                                                               
why that the administration chose  this path and why they believe                                                               
it is important to follow through at this time.                                                                                 
He noted  that when  the administration  first came  into office,                                                               
they  had a  lot on  their  plate in  terms of  agenda items  and                                                               
policies  that  Alaskans  wanted implemented.  We've  been  doing                                                               
that,  he said,  and "after  we've gone  through the  low-hanging                                                               
fruit"  and moved  some of  the more  pressing items  along, they                                                               
found that  there is a  lack of middle management  positions that                                                               
the  administration can  rely on  "to get  down to  the nuts  and                                                               
bolts of the bureaucracy and really  look at how we can do things                                                               
better, how  we can look  at things  more efficiently and  how we                                                               
can change the way state government is run."                                                                                    
That, he  said is  why they  have chosen  to make  these changes.                                                               
They are  looking for  ways to better  manage the  people's money                                                               
and  provide services  when you  must  do more  with less  money.                                                               
"When we're  talking about  new revenues and  we're going  to the                                                               
people  and approaching  them with  these new  ideas, I  think we                                                               
constantly hear them tell us to manage what you have."                                                                          
This change  affects the managerial and  the confidential classes                                                               
of  employees.  Taking  the federal  definition  of  confidential                                                               
class employees, he described them  as having a direct connection                                                               
with labor-relations matters because  they are the employees that                                                               
the  state hires  to represent  it in  labor union  dealings. For                                                               
these same  employees to  be members  of a  union while  they are                                                               
dealing with the union on behalf  of the state is illogical and a                                                               
direct conflict.  This conflict  can't be resolved,  he asserted,                                                               
without excluding them from bargaining.                                                                                         
Although some  have argued that  confidential employees  could be                                                               
segregated so that they bargain in  a separate unit, he said this                                                               
doesn't work because  it doesn't really segregate  them. He noted                                                               
that  this year  nine  of the  units have  joined  together in  a                                                               
coalition. That means that not  a single employee in the division                                                               
of  labor  relations can  work  on  negotiations over  wages  and                                                               
benefits.  "They  can't work  on  language,  they can't  work  on                                                               
proposals, they can't do analysis,  they can't sit at the table."                                                               
Because of  this conflict  the director  has to  do the  work and                                                               
although  he or  she is  certainly  capable of  doing that,  they                                                               
weren't hired to do  it and it takes them away  from the job they                                                               
were  hired  to do.  He  pointed  out  that this  difficulty  has                                                               
surfaced in  past administrations and  it's time to  do something                                                               
about it.                                                                                                                       
Managerial employees compose the  other class under review. While                                                               
they are in  the supervisory unit, they  are managerial employees                                                               
rather than  supervisory employees. Using the  federal definition                                                               
of managerial  employees, which  has between 50  and 60  years of                                                               
precedent, there  is a well-defined body  of law on how  to apply                                                               
the standards.  The line  of policy  that they  want to  adopt is                                                               
that, "If  you are involved  in the formulation, then  you should                                                               
be management.  If you are  carrying out policy, then  you should                                                               
be labor."  Certainly, he said,  the administration  supports the                                                               
ability  and right  for labor  to collectively  bargain. However,                                                               
the distinction  between labor and management  currently falls at                                                               
the commissioner level and that is not appropriate.                                                                             
The  line of  distinction should  be drawn  at the  policy level,                                                               
which  is   exactly  what   SB  352   does.  Removing   both  the                                                               
confidential  and  the  managerial   classes  of  employees  from                                                               
collective bargaining  and including  them in management  draws a                                                               
logical  line  and  allow  those  employees  to  be  utilized  to                                                               
implement  the   policies  the  administration  was   elected  to                                                               
He insisted the debate is an  honest one and he rejected the idea                                                               
that  this  is  cronyism  as  some have  charged.  In  fact,  "We                                                               
approached  the union  that would  be most  affected by  this. We                                                               
gave them  a heads-up -  we offered to  negotiate with them  - we                                                               
discussed this with  them and in fact we made  changes because of                                                               
those discussions. But  this is an honest debate as  to where the                                                               
line between  management and labor  should be drawn and  we think                                                               
that's where the appropriate emphasis should be in the debate."                                                                 
He  noted that  a  number  of state  employees  were present  and                                                               
waiting  to   speak.  Certainly,  he  said,   the  administration                                                               
supports  their right  to  testify  and speak  up  on where  they                                                               
believe the line  should be drawn and how this  bill might affect                                                               
them. "But that's the debate that  we should be having and that's                                                               
the debate we hope to have."                                                                                                    
Contending  that the  current system  provides  more ability  for                                                               
cronyism, he pointed out that now  the only way to deal with this                                                               
situation  is  to  hire additional  partially  exempt  or  exempt                                                               
people. Although  that doesn't entirely  fix the  problem because                                                               
they  still  have  the  right  to bargain,  most  of  them  don't                                                               
bargain. These are political appointees  though and with that you                                                               
have termination without cause and  no merit in hire or promotion                                                               
to speak of.  "What we're doing here is  creating this management                                                               
in  the  classified  service.  We're  not  removing  them  to  be                                                               
political    appointees.    They   will    have    constitutional                                                               
protections," he assured.                                                                                                       
ASSISTANT COMMISSIONER  JARDELL noted  that this  proposal places                                                               
management in  the classified  service. They  aren't going  to be                                                               
political   appointees;  they   will   have  the   constitutional                                                               
protection of a merit system. In  fact, he said, the employees of                                                               
the  Alaska  Labor Relations  Agency  (ALRA)  are classified  but                                                               
excluded  because it  didn't make  sense for  employees that  are                                                               
judging  conflicts between  state management  and unions  to have                                                               
the  same type  of  conflict of  interest  that this  legislation                                                               
addresses. "To  have those  members be  in a union  - I  think we                                                               
would all agree and  I think that's why it was set  up - would be                                                               
a conflict.  That conflict  exists today  in our  labor relations                                                               
staff and our upper level human resource people."                                                                               
The  Murkowski  Administration, he  insisted,  has  no desire  to                                                               
create more  political appointees. Rather,  they want to  take in                                                               
the employees who  are paid to represent the people  of the state                                                               
of Alaska  and remove their  conflict of interest,  which results                                                               
from belonging  to the union  that is representing  the interests                                                               
of its  members. "What we want  to do is bring  in the management                                                               
team that  we are  currently paying higher  ranges to  because of                                                               
the authority - because of their  formulation of policy - we want                                                               
to bring  them into the  management team so  that we can  rely on                                                               
their expertise so that they can  be a bigger part of moving this                                                               
state forward and  implementing the policies that  the people put                                                               
us here to do."                                                                                                                 
Although he  sympathized with the  people who have jobs  that are                                                               
being  reclassified,  he  emphasized  that  this  is  appropriate                                                               
public  policy. "But  in the  future, from  now on,  if a  person                                                               
wants to stay represented they can.  They don't have to choose to                                                               
move up into management."                                                                                                       
He noted that at the  previous hearing, 28 state employees signed                                                               
up  to  testify.  Of  those  28,  just  two  were  identified  as                                                               
managerial   employees.  He   clarified   that   is  from   their                                                               
perspective,  which   isn't  necessarily   the  same   as  ALRA's                                                               
perspective.  The  identified  positions include  the  person  in                                                               
charge of the  McLaughlin Youth Center and  the superintendent of                                                               
Mat-Su  Pretrial. They  are management,  but they  really aren't,                                                               
they're labor and that conflict exists. For example:                                                                            
     When we  walk in  and we  ask to  look at  the finances                                                                    
     of...  corrections.  We  have a  superintendent  of  an                                                                    
     institution.  Underneath that  superintendent you  have                                                                    
     an administrative  manager who  kind of does  the daily                                                                    
     administration activities  - keeps up with  the budget,                                                                    
     keeps  up with  the  finance and  accounting. Then  you                                                                    
     have the  admin-service director in  the commissioner's                                                                    
     office   down  here   in   Juneau.   The  director   of                                                                    
     administrative services for corrections  - if they want                                                                    
     to get  information on the finances  of the institution                                                                    
     they  don't have  a management  person to  go to.  They                                                                    
     contact    the   administrative    manager   and    the                                                                    
     superintendent of  the institution.  The administrative                                                                    
     manager can't give them the  information - because they                                                                    
     work  for the  superintendent -  without going  through                                                                    
     the  superintendent.  So,  you have  an  administrative                                                                    
     services director  that can't get  critical information                                                                    
     on   the  finances   of   an   institution  without   a                                                                    
     representative  person making  the decision  on whether                                                                    
     to give it to him or what to give to him.                                                                                  
     Are  they giving  misinformation? I  have no  reason to                                                                    
     believe they  are and I'm  not making  that accusation.                                                                    
     What  I'm saying  is  there  ought to  be  a member  of                                                                    
     management  in that  institution that  you can  contact                                                                    
     and you can  say, 'How do we implement a  policy to cut                                                                    
     back on overtime?  How do we implement a  policy to run                                                                    
     our institutions for less.'                                                                                                
SENATOR LYMAN  HOFMAN interjected  to ask  a question  related to                                                               
corrections  and middle  management saying  he was  informed that                                                               
middle  management positions  are being  eliminated in  the Yukon                                                               
Kuskokwim  Correctional  Center  in particular.  Furthermore,  he                                                               
noted that  over the last  seven years when  government underwent                                                               
streamlining and  over $250 thousand  was cut from  the operating                                                               
budget,   the  targeted   area  was   middle  management.   These                                                               
positions,  he  said,  are  the low  hanging  fruit  referred  to                                                               
earlier. He  observed that the administration  isn't recommending                                                               
eliminating middle management in any other place.                                                                               
ASSISTANT  COMMISSIONER JARDELL  cautioned "that  you want  to be                                                               
careful  when  you  use  middle   management  in  the  managerial                                                               
definition."   That,  he   said,   is   particularly  true   with                                                               
corrections. He elaborated:                                                                                                     
     In  our review  it would  be the  superintendent -  the                                                                    
     warden if you  will - of the institution  that we would                                                                    
     say is management and I  think that is commonsensical -                                                                    
     that  the person  in charge  of the  institution should                                                                    
     represent  management's  interest   in  running  it  in                                                                    
     policy   and   formulation   of  those   policies   and                                                                    
     implementation of  those policies. When you  talk about                                                                    
     what  we've been  doing  to cut  costs  and cut  middle                                                                    
     management I think  what you're referring to  - and I'm                                                                    
     not  an expert  on  corrections  reorganizations -  but                                                                    
     what  I  believe  you're referring  to  is  some  upper                                                                    
     supervisory personnel and  whatnot where they're trying                                                                    
     to remove  the heavy  supervisor org-chart and  move it                                                                    
     down   to   less   supervisors  and   more   front-line                                                                    
     personnel.  But, I'm  not well  versed in  what they're                                                                    
     doing in  the Y K  area and  I apologize for  that, but                                                                    
     it's  just  an  example   of  the  org-charts  and  the                                                                    
     individuals  that  run   the  institution.  That's  the                                                                    
     managerial  employee, not  - and  I don't  know of  any                                                                    
     superintendents that we've presumed to eliminate.                                                                          
SENATOR  HOFFMAN  noted  that  the  assistant  commissioner  used                                                               
correctional institutions as  an example at the  last hearing and                                                               
he   took   issue    with   the   administration's   assumptions.                                                               
Furthermore, "by  your example, what you're  trying to accomplish                                                               
isn't going to get accomplished."  Once the superintendent of the                                                               
facility in Bethel  leaves, who's going to  make those decisions?                                                               
Someone from  Anchorage, Fairbanks, or  Juneau would have  to fly                                                               
in, which  would take  him or  her away from  the work  they were                                                               
hired to do.                                                                                                                    
ASSISTANT COMMISSIONER JARDELL acknowledged  that is an excellent                                                               
point on corrections specifically, but  that is a somewhat unique                                                               
circumstance. He  clarified that at  the previous meeting  he was                                                               
referring to  the divisions that have  a second person such  as a                                                               
deputy  director.  If they  were  brought  into management,  they                                                               
could continue to represent management  if the director was gone.                                                               
But   in   the  instance   of   corrections,   the  director   of                                                               
institutions,  who   is  a  political  appointee,   is  over  the                                                               
superintendents  so there  wouldn't be  a second  person at  each                                                               
institution. It's  not a  difficult concept  though, to  have the                                                               
warden that is running the institution be a part of management.                                                                 
CHAIR  GARY  STEVENS  acknowledged   that  all  the  members  had                                                               
questions, but  he wanted the assistant  commissioner to complete                                                               
his presentation.                                                                                                               
ASSISTANT COMMISSIONER JARDELL said he  had just two more points.                                                               
First, he said he misspoke at  the previous hearing, but it plays                                                               
directly into what  they are trying to change.  He clarified that                                                               
there  is  one  more  political  appointee  in  the  Division  of                                                               
Retirement  and  Benefits than  he  said  there was.  A  special-                                                               
project  exempt person  was  hired to  look  at reorganizing  the                                                               
division because no  one in the division could do  that job. "The                                                               
person that ought  to be helping us do  the reorganization, bring                                                               
them into management and let them  help us do these policies," he                                                               
The last  point he emphasized  is that this is  mainstream rather                                                               
than  extreme.  He noted  that  supporting  documentation in  the                                                               
packets show  that most  states agree  with this  approach. These                                                               
are mainstream concepts of  organizational structure because they                                                               
make sense.                                                                                                                     
SENATOR GRETCHEN GUESS referred to  the example given relating to                                                               
the corrections  finance employee and asked  for clarification of                                                               
his assertion  that you  can't get  information from  an employee                                                               
because they  have chosen to  be represented. She  suggested that                                                               
is  not  logical because  it's  one  professional asking  another                                                               
professional for information.                                                                                                   
ASSISTANT COMMISSIONER JARDELL conceded  that he could have found                                                               
a  better word  than can't.  Nonetheless, his  point is  that the                                                               
organizational chart  suggests that there  is a missing  link for                                                               
the  director  in   Juneau  to  have  access   to  the  financial                                                               
information  at an  institution  because there  is no  management                                                               
person at the  institution to relay the  requested information on                                                               
a policy oriented level to the commissioner's office in Juneau.                                                                 
SENATOR  GUESS  commented  it's  either a  capital  issue  or  an                                                               
information  technology  (IT)  issue   because  any  director  of                                                               
administrative services  should be able  to pull up  data through                                                               
an appropriate IT  system. She suggested that there  isn't a need                                                               
to change the  law simply because information  isn't flowing from                                                               
one place to another.                                                                                                           
CHAIR GARY  STEVENS asked whether  he knew how many  people would                                                               
be affected in the two classes.                                                                                                 
ASSISTANT COMMISSIONER  JARDELL said they  have tried to  come up                                                               
with an accurate  estimate and believe there might  be 450 people                                                               
affected  in the  managerial definition.  He  opined that  number                                                               
would  shrink after  analyses are  done on  position descriptions                                                               
compared with  what the  employee is  actually doing.  If they're                                                               
not doing policy work, they shouldn't be management.                                                                            
There  are  approximately 60  people  in  the confidential  unit,                                                               
which  includes   those  people   with  the  direct   nexus  with                                                               
representing the state in labor-relations matters, he said.                                                                     
CHAIR GARY STEVENS noted that  he has received hundreds of emails                                                               
from  concerned  people, 35  people  signed  up to  testify  last                                                               
hearing and  40 people were signed  up today. If just  two of the                                                               
35 who signed  up last time are really management,  then there is                                                               
a  lot of  misunderstanding  and  that is  a  large  part of  the                                                               
problem. To  that end,  he asked  Mr. Jardell  whether he  sent a                                                               
letter of explanation to state workers.                                                                                         
ASSISTANT  COMMISSIONER  JARDELL  said Commissioner  Mike  Miller                                                               
sent a  letter to all state  employees last Friday and  they hope                                                               
that was a better explanation. He added:                                                                                        
     And  deliberately so  we  did  not include  supervisory                                                                    
     personnel   -   supervisory  personnel   dealing   with                                                                    
     personnel  issues   -  hiring,   firing,  transferring,                                                                    
     promoting, looking  at subordinates work.  Carrying out                                                                    
     policy  is  not included.  Only  those  few very  upper                                                                    
     level people  who are actually formulating  policy, and                                                                    
     that's  the  crux, and  most  of  the people  who  have                                                                    
     concerns  and  fears  -  and   I  certainly  have  some                                                                    
     sympathy for  them - will  not be affected. As  we said                                                                    
     earlier, out of  the 28 people that we  looked at, only                                                                    
     two would be absolutely managers...                                                                                        
MR.  CHANCE interjected  that three  other  positions deserved  a                                                               
second look  because the  "org charts  don't tell  you everything                                                               
and the PDs don't tell  you everything...but three only warranted                                                               
a look."                                                                                                                        
ASSISTANT  COMMISSIONER JARDELL  added that  he understands  that                                                               
change is  disconcerting, but  opined that  most of  the concerns                                                               
wouldn't  prove  to  be  legitimate  because  state  workers  are                                                               
protected by the constitution and the statutes.                                                                                 
SENATOR GUESS  asked what process  he used to make  the rough-cut                                                               
estimate on how  many positions would be affected  and noted that                                                               
they are all fairly high ranges.                                                                                                
ART  CHANCE,  director,  Division of  Labor  Relations,  replied,                                                               
"Range and anecdote; range doesn't always tell you everything."                                                                 
CHAIR GARY STEVENS  asked if any of the employees  that are moved                                                               
out of collective  bargaining would have the  opportunity to move                                                               
back into  a protected, union  job. His concern stemmed  from the                                                               
fact  that  these individuals  made  a  choice based  on  certain                                                               
conditions and those conditions may change.                                                                                     
MR. CHANCE said that would have  to be negotiated with the unions                                                               
but it isn't uncommon for  union contracts to have some provision                                                               
by  which supervisors  or managers  can retain  seniority in  the                                                               
bargaining unit for some period of time. He continued,                                                                          
     It's been a vexatious problem  under our system even as                                                                    
     it  currently  exists  when people  leave  the  general                                                                    
     government  or  the  labor trades  and  craft  unit  to                                                                    
     become supervisors  how they  get back. They  have some                                                                    
     merit system  rights but  there's been  quite a  bit of                                                                    
     litigation about  it. But, we  could negotiate  a means                                                                    
     by  which  people  could opt  back  in.  Employees  can                                                                    
     always voluntarily  demote and there are  provisions in                                                                    
     both rules and contracts for  that. It's very common to                                                                    
     preserve  seniority when  someone  leaves a  bargaining                                                                    
     unit job to accept a supervisory manager job.                                                                              
ASSISTANT COMMISSIONER JARDELL made the point that,                                                                             
     Currently  under the  Personnel Act,  we probably  have                                                                    
     the  authority  to  move these  people  into  partially                                                                    
     exempt. We have to go  to [the] Personnel Board to make                                                                    
     the case,  but there  is a  definition that  allows for                                                                    
     partially  exempt status  that is  very similar  to the                                                                    
     definition   for  management   employee  so   we  could                                                                    
     probably do  this ...  but we  just don't  think that's                                                                    
     the  right thing  to  do for  public  policy. We  don't                                                                    
     think  it's  the  right  thing  for  long-term  state's                                                                    
     interests;  and   so  although  I  do   understand  the                                                                    
     transition  time  with  the points  you're  making,  we                                                                    
     think  the public  policy behind  it far  outweighs the                                                                    
     benefits to the state and the people.                                                                                      
SENATOR HOFFMAN noted that the fiscal note shows no significant                                                                 
fiscal impact, but 450 managerial and 60 confidential employees                                                                 
might be affected. Continuing in that vein, he said:                                                                            
     Then we  go to  an area where  we're talking  about the                                                                    
     individuals who would have  a significantly higher rate                                                                    
     of   pay  under   the   union  contract.   Geographical                                                                    
     differential pay  - it  seems as  though they  would be                                                                    
     higher  and I'm  just using  your numbers  now. Say  we                                                                    
     have COLA  in Chugiak of  15 percent, Fairbanks  of 3.5                                                                    
     percent, Bethel  38 percent. Higher pay  that you would                                                                    
     have  to pay  these individuals  because they're  - the                                                                    
     non-unions are  set in statute.  Nome is  33.75, Valdez                                                                    
     18 percent so these  are substantial percentages. So if                                                                    
     I even  take one  of the lowest  percentages and  say -                                                                    
     and  all  of  these   people  that  are  in  managerial                                                                    
     positions are at the high  spectrum - say $80,000 - and                                                                    
     don't even  use 38 percent,  which is Bethel's  - don't                                                                    
     even  use  33  percent,  which in  Nome's  -  not  even                                                                    
     Valdez's  at  8  percent,  not  even  Fairbanks  at  15                                                                    
     percent. Let's say 5 percent.  So you take 5 percent of                                                                    
     $80,000,  that's   $4,000  per  individual   times  400                                                                    
     people. That's $1.6  million and that's at  the low end                                                                    
     of 5  percent for  geographic pay differential.  And if                                                                    
     we went to  10 percent, you're talking in  excess of $3                                                                    
     million. Even though you say  that's the high end, even                                                                    
     if that was reduced,  we're talking, from my standpoint                                                                    
     being on the  Finance Committee for over ten  years - I                                                                    
     would say that has  significant financial impact to the                                                                    
     state. So  I'm wondering  if this  fiscal note  that we                                                                    
     have that  affects all  departments, as  you're saying,                                                                    
     is actually true.... Can you respond to that?                                                                              
ASSISTANT COMMISSIONER  JARDELL said he did  evaluate the numbers                                                               
and  researched   how  personnel  costs  are   treated  in  these                                                               
situations. The answer he received is,                                                                                          
     We treat  these just as  we do all personnel  costs. If                                                                    
     we transfer  a position from  Juneau to Nome,  we don't                                                                    
     go  in  for  an  increment;  we  don't  go  in  for  an                                                                    
     appropriation. These  are like  steps. If we  have step                                                                    
     increases coming  up we don't  go into  the Legislature                                                                    
     and  say,   'We  need  an   increase  for   those  step                                                                    
     increases.'  They  are  personnel  costs,  and  they're                                                                    
     based  on the  individuals and  the ranges  and so  the                                                                    
     differences  between  the  geo-diffs and  some  of  the                                                                    
     union  contracts  do  have  geo-diffs  -  they  may  be                                                                    
     different  so it  may  not  be as  bad  as what  you're                                                                    
     talking  about, but  the way  we treat  personnel costs                                                                    
     and  the appropriations  in  the  Finance Committee  is                                                                    
     that you treat them by  the range and by the individual                                                                    
     - and by  the individual employee. We do not  go in for                                                                    
     specific appropriations  because of  moving a  group of                                                                    
     people from Anchorage to Mat-Su  or bringing in - we're                                                                    
     going  to shut  down  an office  in  ... Fairbanks  and                                                                    
     we're  going to  move  those down  and  we're going  to                                                                    
     consolidate  them in  Anchorage. We  don't come  in and                                                                    
     provide a  decrement because there's a  14 percent less                                                                    
     or 13 percent  less geo-diff. We just don't  do it that                                                                    
     way. The  personnel costs, under  the theory,  begin to                                                                    
     be a  wash with  people rotating in  and out  and steps                                                                    
     changing back  and forth  and so  we think  the correct                                                                    
     way  to  approach this  is  the  same way  we  approach                                                                    
     personnel costs - that the  personnel costs will be the                                                                    
     same  range,   approximately  the  same  step   and  we                                                                    
     wouldn't go in  for an appropriation for  a geo-diff or                                                                    
     anything like that.                                                                                                        
SENATOR HOFFMAN  said he would  agree with that analysis  if just                                                               
one  or  two  people  were involved  because  the  dollar  amount                                                               
wouldn't be that significant. However,  "When we're talking about                                                               
500 people  at the upper  end and we're  talking about if  we use                                                               
the  high average  of  the high  end of  say  20 percent,  you're                                                               
talking $6 million  and that's significant." He  continued to say                                                               
that, "You're the  one that said we need to  have a debate that's                                                               
honest  and forthright  and  to  me, this  fiscal  note does  not                                                               
reflect -  come near to  reflecting what it may  potentially cost                                                               
the state and  that, I guess, is  where I have a  problem in that                                                               
this does  not accurately reflect  what the potential  outcome of                                                               
this  legislation would  impact  the state  fiscally  if it  were                                                               
ASSISTANT COMMISSIONER  JARDELL said  he respected  that opinion,                                                               
but  believes that  they are  in line  with the  way they  handle                                                               
personnel costs. Furthermore,                                                                                                   
     I think  it is somewhat  insignificant when we  look at                                                                    
     it division  by division by division  level and whether                                                                    
     we're  going  to  come  in for  an  increment  at  each                                                                    
     division level  for these personnel costs  - that's not                                                                    
     how  we budget,  that's not  how we  go forward  to the                                                                    
     Finance Committee, that's not  how we propose budgets -                                                                    
     and so  we are  in line  with the  way we  handle these                                                                    
     matters. We  would not be  asking for  an appropriation                                                                    
     to handle  this. The personnel costs  would be absorbed                                                                    
     in the way we fund personnel  - by range and the number                                                                    
     of employees.                                                                                                              
SENATOR GUESS said she too had  questions on the fiscal note. She                                                               
noted that the  appeals process is different because  one goes to                                                               
arbitration and the other is legal  so it is interesting that the                                                               
Department  of  Law  submitted  no fiscal  note.  She  asked  the                                                               
assistant commissioner  if he was saying  that dispute resolution                                                               
would cost the same in both systems.                                                                                            
ASSISTANT COMMISSIONER JARDELL replied,                                                                                         
     We do  not think there  that there will be  an increase                                                                    
     in costs that amount to  a need of an appropriation. We                                                                    
     don't think that there is  something that we would even                                                                    
     ask for. The Personnel Board  is a three person board -                                                                    
     that's where we'd  go to. They meet  routinely, we have                                                                    
     a  meeting coming  up, we  call them  in for  different                                                                    
     things - if  an individual had an issue to  take to the                                                                    
     Personnel Board they would go  to a meeting, they would                                                                    
     present that case and it  would be dealt with. We don't                                                                    
     anticipate that  it would increase  costs. And  some of                                                                    
     that is  based on our discussions  with labor relations                                                                    
     and this level of employee.                                                                                                
TAPE 04-13, SIDE B                                                                                                            
4:30 pm                                                                                                                       
     Most of these individuals have  been in this system for                                                                    
     a long time. They don't  have a lot of grievances; they                                                                    
     don't  have  a lot  of  issues  that we  would  foresee                                                                    
     coming  forward.  Our  experience doesn't  lead  us  to                                                                    
     believe there  would be an increased  cost in Personnel                                                                    
     Board system.                                                                                                              
SENATOR GUESS asked if he expects a decrease in funding.                                                                        
ASSISTANT  COMMISSIONER JARDELL  said, "Not  at this  time, no  I                                                               
would not."                                                                                                                     
SENATOR  GUESS  asked  about   the  comment  regarding  voluntary                                                               
demotion  and  asked what  would  happen  to  the pay  for  those                                                               
individuals that  stay in  the bargaining unit  in the  short run                                                               
and the long run.                                                                                                               
ASSISTANT  COMMISSIONER  JARDELL  said   that  is  a  product  of                                                               
classification and doing  studies and research. "What  we have to                                                               
do is pay equal  pay for like work and so until  we go though and                                                               
do those studies and do the  analysis, I can't give you an answer                                                               
on that.  But the people  with the  same type of  level authority                                                               
the same  type of level of  work - you would  have an expectation                                                               
to pay them similarly or the same."                                                                                             
SENATOR GUESS reasoned that anytime  an employee moves from being                                                               
represented  to being  non-represented, the  employee takes  more                                                               
risk and that  risk must be compensated  through increased wages.                                                               
"That's labor econ 101," she suggested.                                                                                         
She understood  the answer that there  wouldn't be a cost  in the                                                               
short run, but  she questioned whether the  new manager employees                                                               
wouldn't have  to be paid more,  which would result in  a cost in                                                               
the long run.                                                                                                                   
ASSISTANT COMMISSIONER  JARDELL said  he didn't  know that  to be                                                               
true  and  suggested that  the  employees  are already  paid  for                                                               
management level work. "What we're  trying to delineate is if you                                                               
are earning more  wages because you are part  of management, then                                                               
you should be a full part  of management. You shouldn't have that                                                               
conflict  where we're  going to  pay  you to  help formulate  the                                                               
policy,  but  we   can't  utilize  you  in  all   of  our  policy                                                               
discussions. We can't  utilize you in all of  our meetings.... If                                                               
we find  that similar situated people  need to be paid  more, and                                                               
adjust  that, we  will. I  don't think  we'll have  a problem  in                                                               
finding  people  who  are  willing  to  take  this  work  in  the                                                               
classified  but excluded  range...I don't  think there's  a basis                                                               
for thinking that there is going to be an increased cost here."                                                                 
CHAIR  GARY   STEVENS  asked  whether  there   were  any  further                                                               
questions before he opened public testimony.                                                                                    
SENATOR HOFFMAN said he had several questions.                                                                                  
SENATOR  GUESS  added  she  had  several as  well,  but  she  was                                                               
concerned about the time.                                                                                                       
CHAIR GARY  STEVENS assured members,  "We will take all  the time                                                               
we  need  to get  the  answers  that  you  wish answers  to."  He                                                               
continued  to  say that  he  would  like  to  move on  to  public                                                               
testimony right then however, because the hour was getting late.                                                                
He asked  the assistant commissioner  to stay  in the room  to be                                                               
available to respond  to questions or statements  and clarify any                                                               
misunderstandings.  To   those  waiting  to  testify,   he  asked                                                               
everyone  to limit  their comments  to no  more than  two minutes                                                               
HAL GEIGER  spoke as a private  citizen who works for  the state.                                                               
He said he has been eligible  for retirement for some time so the                                                               
bill wouldn't  affect him.  However, he  was concerned  about the                                                               
institution  of  the  Alaska  Department of  Fish  and  Game.  He                                                               
     I think if you go back  and look at some of the history                                                                    
     that led up to statehood,  fisheries issues were a very                                                                    
     big  part of  statehood considerations.  And if  you go                                                                    
     back  and  look  at  some  of  the  editorials  in  the                                                                    
     Fairbanks papers  and just a  whole lot of  things that                                                                    
     were  written in  the 50s,  you'll  see that  political                                                                    
     interference  in   fisheries  management  and   a  very                                                                    
     politicized  fisheries management  was  a major,  major                                                                    
     issue leading up to statehood.                                                                                             
     At the  time of  statehood, the total  commercial catch                                                                    
     was about 25  million fish and I think a  lot of people                                                                    
     in  the state  of Alaska  felt like  the fisheries  had                                                                    
     been   very  depleted   by   over   harvest  and   just                                                                    
     ineffective management.  By 1995  we had  captured over                                                                    
     217 million fish.  That is a level of  harvest that was                                                                    
     absolutely unimaginable in the  early 60s and 70s. Last                                                                    
     year  the  commercial  harvest was  about  174  million                                                                    
     At  the time  of statehood,  I  think a  lot of  people                                                                    
     wanted  a  politically independent  fishery  management                                                                    
     system and to a large extent,  we got that. We have the                                                                    
     Board  of Fisheries,  the Board  of Game,  which is  an                                                                    
     explicitly political  body and that is  where political                                                                    
     decisions need to  be made. And I think if  you go look                                                                    
     at how some  of the other states in this  unit are run,                                                                    
     that's really separates Alaska from  a lot of the other                                                                    
     states. That  we explicitly take care  of the political                                                                    
     job  there and  then we  have a  corps of  professional                                                                    
     managers that are to carry out that policy.                                                                                
CHAIR GARY STEVENS  told Mr. Geiger that he  understood that this                                                               
is a  difficult issue, but  to please  sum up quickly  because he                                                               
had passed the time threshold.                                                                                                  
MR.  GEIGER concluded  saying that  management  of the  fisheries                                                               
would be impossible  without some level of  independence from the                                                               
political process.                                                                                                              
CHAIR GARY STEVENS  apologized for having to  rush people through                                                               
their  testimony, but  he wanted  to  give everyone  a chance  to                                                               
BOB MURPHY  testified from the  Kodiak LIO  to oppose SB  352. He                                                               
said  he was  representing himself,  but  he has  worked for  the                                                               
ADF&G since  1986. He  said, "I manage  a large  scale commercial                                                               
salmon fishery based  on regulations approved by  Alaska Board of                                                               
Fisheries  and sound  biological principles  that always  put the                                                               
resources first  and foremost.  My concern of  this bill  is that                                                               
superior  staff  with  a  political  agenda  will  influence  the                                                               
decisions that are made involving managing resources."                                                                          
ASSISTANT COMMISSIONER  JARDELL responded saying that  there is a                                                               
philosophical difference  and Mr. Murphy's job  probably wouldn't                                                               
be affected, but:                                                                                                               
     On  the greater  scheme  of things,  the  fear of  this                                                                    
     monster  of  political  influence -  the  governor  was                                                                    
     elected by the people  to implement policies... and the                                                                    
     idea that somehow union protection  is going to somehow                                                                    
     keep  this  boogieman  of  political  influence  -  the                                                                    
     political  influence isn't  bad  -  these are  policies                                                                    
     that the people  have asked us to do -  and implement -                                                                    
     not  illegal  things,  not  inappropriate  things,  but                                                                    
     different changes  in direction. It's just  a different                                                                    
     philosophy as to whether or  not you look at people and                                                                    
     say  with  union  protection we  can  perhaps  distance                                                                    
     ourselves  and  not  implement   the  policies  of  the                                                                    
     elected  governor. Well  that is  something we  want to                                                                    
     change  if that's  happening. We  do want  to implement                                                                    
     the  policies  of  elected  officials  and  if  somehow                                                                    
     belonging to  an organization that's looking  after its                                                                    
     members goals precludes us from  doing that then that's                                                                    
     a good change.                                                                                                             
M.  L.   LOUDERMILK,  president  of  the   Anchorage  Council  of                                                               
Education, said he was confused  because he was hearing something                                                               
different than  he was reading in  the bill. In fact  he said, "I                                                               
believe  the  bill  is  kind   of  a  recipe  for  confusion  and                                                               
Although he is hearing that  only a few high-level employees will                                                               
be  affected, he  interprets  the  bill to  say  that any  public                                                               
employer  may exclude  hundreds  of positions.  He was  concerned                                                               
that  the definition  of manager  is vague  enough that  it could                                                               
allow   political  agendas   to  control   program  managers   in                                                               
workplaces where Alaska and Personnel Board bills don't apply.                                                                  
KAYE SAXON  from Mat-Su  testified that she  is a  state employee                                                               
who is  unlikely to be impacted,  but she is concerned  about the                                                               
state adding  costs to  the budget  and about  political politics                                                               
infiltrating important programs and  services. She contended that                                                               
other  employees would  be affected  because  of the  instability                                                               
that  will  result  with  political   appointments  at  the  mid-                                                               
management level.                                                                                                               
JIM FIORENZI testified from the Fairbanks  LIO to say that he has                                                               
worked for  DOT/PF since 1982  so he  has had the  opportunity to                                                               
work  under   various  administrations  and  has   worked  for  a                                                               
partially exempt political appointee for most of his career.                                                                    
He didn't believe  the proposed legislation would  impact him one                                                               
way  or  the  other, but  he  did  want  to  comment on  what  he                                                               
perceives  to  be  a  serious problem  with  the  existing  state                                                               
personnel bargaining  unit and system  of classification  and how                                                               
the proposed legislation might aggravate the situation.                                                                         
He described the glass ceiling  concept and told members that the                                                               
same problem  is associated with  the state personnel  system. He                                                               
explained  that he  is  a member  of  what is  referred  to as  a                                                               
supervisory  bargaining  unit,  which  probably  means  that  the                                                               
members are  in the managerial  category. He made the  point that                                                               
the difference in salary between  the supervisory bargaining unit                                                               
and  others with  like ranges  is just  3.75 percent  which isn't                                                               
enough  when  the  myriad   of  additional  responsibilities  are                                                               
considered. He said, "I'm convinced  that should this legislation                                                               
pass, that all that will  be accomplished is the strengthening of                                                               
the glass ceiling  in which case, the state's  ability to attract                                                               
or   promote   the   best,   brightest   most   experienced   and                                                               
knowledgeable will effectively cease to exist."                                                                                 
BRUCE LUDWIG  testified from Juneau  and said he is  the business                                                               
manager  of  the Alaska  Public  Employees  Association and  they                                                               
represent both  the supervisors  and the  confidential employees.                                                               
He commented, "I guess you could call us low hanging fruit."                                                                    
The concept  of creating  a managerial  class of  employees isn't                                                               
new he said.                                                                                                                    
     It's been  around since  the Public  Employee Relations                                                                    
     Act was passed  and the agency did,  in fact, establish                                                                    
     something called  the non-covering group. It  was three                                                                    
     or four  of the higher people  in personnel management.                                                                    
     In  the late  70s,  the  labor-relations staff  removed                                                                    
     themselves from the bargaining unit  and became part of                                                                    
     that group.                                                                                                                
Mr.  Ludwig said  he worked  there during  the transition  to the                                                               
Sheffield  Administration and  that  was a  similar situation  to                                                               
this  proposal.  He  explained  that he  saw  employees  who  had                                                               
constitutional rights  to their job  run out of the  division. "I                                                               
saw them move  down the hall with frozen pay.  I saw them demoted                                                               
down  to  range  13  without  recourse."  He  remarked  that  the                                                               
constitution is a  nice instrument, but if you want  to fight you                                                               
must hire an attorney because  the constitution doesn't fight for                                                               
He suggested that it is less  than objective to say that just 500                                                               
people would be  affected because the way the  language reads, it                                                               
will be  far more.  The confidential  employee definition  is the                                                               
same that  is currently  in regulation.  "The agency's  found 225                                                               
people  to be  covered  under  that, not  60  so  I think  that's                                                               
disingenuous also."                                                                                                             
SENATOR GUESS asked when the PERA bill was first passed.                                                                        
MR. LUDWIG replied, "It was  passed in 1972, petitions were filed                                                               
in 73 to represent employees."                                                                                                  
SENATOR HOFFMAN  asked Mr. Ludwig  whether he thought  the fiscal                                                               
note that indicates that there  would be no significant impact on                                                               
state agencies was accurate.                                                                                                    
MR. LUDWIG said, "Not at all. I  ran just the range 22s and above                                                               
in the  supervisory unit  and to go  on the  statutory geographic                                                               
differential  schedule is  over $500,000.  When you  look at  the                                                               
number of  hearings that  are going  to be  required to  hear all                                                               
these hundreds  of cases before  the agency, the agency  is going                                                               
to have to have money, the  state's going to have attorneys there                                                               
- it's going to cost a lot of money."                                                                                           
SENATOR HOFFMAN  then asked  whether he  thought the  studies for                                                               
equal pay for like work would be costly.                                                                                        
MR.  LUDWIG  replied,  "Studies  aren't cheap  and  I  think  the                                                               
Division Of Labor  Relations spent quite a bit of  money that you                                                               
gave them last year for negotiations on studies."                                                                               
CHAIR  GARY STEVENS  asked about  the employees  that moved  into                                                               
positions understanding  that they were represented  and now find                                                               
they may not have that protection.  He asked for a comment on how                                                               
they might opt back in as was suggested.                                                                                        
MR. LUDWIG said,  "If you're at the bottom end  of the totem pole                                                               
on the supervisors,  you're not allowed, right now,  to bump down                                                               
to  general  government.  There  is  a  fence  built  around  the                                                               
bargaining units.  The only way  that I  know that they  could do                                                               
that is  if there was a  vacancy that they could  say, 'I'll take                                                               
that lower job.'"                                                                                                               
ASSISTANT COMMISSIONER JARDELL responded:                                                                                       
     On the 225  to 60 with the prior ALRA  board looking at                                                                    
     225 - we did look at  that and there is a difference in                                                                    
     the  definition that  we have  chosen in  the precedent                                                                    
     that we  referenced with  the National  Labor Relations                                                                    
     Agency and  the body of  law that has developed  out of                                                                    
     this  definition.  And there  is  a  difference in  the                                                                    
     amount  of labor  relations  that you  have  to do  and                                                                    
     under this  definition, we stand  by our  analysis that                                                                    
     shows that there will probably  be about 60 people that                                                                    
     will  be affected  by this  bill  in confidential.  And                                                                    
     with the  classification studies that were  raised, and                                                                    
     the study  that was  mentioned with the  bargaining, we                                                                    
     did a salary survey for  purposes of determining how we                                                                    
     stood up  against other states.  For purposes  here, we                                                                    
     do a classification study, which  is internal. We would                                                                    
     not  hire  additional   people.  We  do  classification                                                                    
     studies as  they arise. We do  them as a part  of doing                                                                    
     business and we do them all the time.                                                                                      
SENATOR  GUESS referenced  earlier testimony  and asked  why this                                                               
wouldn't include every public school principal in the state.                                                                    
ASSISTANT  COMMISSIONER  JARDELL  explained,  "It  would  include                                                               
people who  are doing policy  level work...That's  the definition                                                               
that every  state that has  statutes relating to  labor relations                                                               
has, except for  two, that's the one that works  in these states,                                                               
it's the one  that we think works here. If  you're developing and                                                               
formulating policy, you should be management."                                                                                  
SENATOR   GUESS  asked   whether  the   Murkowski  administration                                                               
believes that principals fall under SB 352.                                                                                     
ASSISTANT  COMMISSIONER  JARDELL said  he  would  have to  better                                                               
understand how principals interact  with the superintendents, who                                                               
cannot bargain,  and how  they interact  with teachers.  "If they                                                               
are formulating policy, and they  are bargaining under PERA, then                                                               
they very well may be included in this legislation."                                                                            
NICK  SAGALKIN testified  from  the  Kodiak LIO  and  said he  is                                                               
adamantly opposed  to the  bill and his  objections echo  many of                                                               
the   comments   made   previously.  "It's   very   unclear   how                                                               
implementation of this  bill will allow us to do  our jobs better                                                               
without the protection of the union."                                                                                           
CHAIR GARY STEVENS asked whether he is a state employee.                                                                        
MR. SAGALKIN replied he is employed  by the state and he believes                                                               
the bill would indirectly affect him.                                                                                           
JAN DEYOUNG, Department of Law,  spoke from Anchorage to say that                                                               
she was listening and available  to respond to specific questions                                                               
and assist Assistant Commissioner Jardell.                                                                                      
OLE LARSON testified from Mat-Su  to say he is the superintendent                                                               
of the Mat-Su Pretrial facility and he would be affected.                                                                       
     Within  the Department  of Corrections  that last  year                                                                    
     eliminated  all  its  assistant  directors  and  deputy                                                                    
     directors so  I am in  direct line with my  director of                                                                    
     institution, which  is a PX  position. There  are three                                                                    
     layers  of  PX  position  above  me,  but  only  in  my                                                                    
     institution the  next supervisory  level is  a sergeant                                                                    
     and that's  the only supervisor level  that's there. We                                                                    
     used  to  have  an assistant  superintendent  that  was                                                                    
     eliminated  in '92  - talking  about paring  down state                                                                    
     government  - this  facility that  I'm in  has lost  20                                                                    
     percent of its staff over  the last 12 years. Virtually                                                                    
     what  would  happen is  there's  nobody  ...to take  my                                                                    
     place  if I  became a  non-bargaining unit  member. The                                                                    
     Department of  Corrections also eliminated last  year 9                                                                    
     or 10 assistant superintendents  out of the institution                                                                    
     so there  is no mid-management  below me in  a majority                                                                    
     of the institutions. They  did create some correctional                                                                    
     officer IV positions, but that's about all there is.                                                                       
     So the career track  for a 20-year correctional officer                                                                    
     would  be  a  recruit,  a correctional  officer  II,  a                                                                    
     sergeant and possibly,  if the facility has  it, a COIV                                                                    
     and possibly an assistant superintendent.                                                                                  
     The  point I  guess I'm  getting  at is  we're a  small                                                                    
     state, we're  a very  small department comparably  to a                                                                    
     lot  of  departments outside  and  there  is no  career                                                                    
     ladder per se for corrections.  If I became a partially                                                                    
     exempt or  an at  large employee  that would  just take                                                                    
     that much more of the career track out.                                                                                    
     I am a career professional,  I have never, ever blocked                                                                    
     a request  or hidden  any money  or done  anything like                                                                    
     what was  suggested and all  my finances from  my admin                                                                    
     officers is online and available  for the state through                                                                    
     Access-Alaska.  Matter of  fact, they  tell us  what we                                                                    
     have in our budget.                                                                                                        
CRIS  TIGNER testified  from Fairbanks  and  said she  is in  the                                                               
supervisory unit of Local 4900.  She urged the committee to table                                                               
the  bill  because  it  would  open  the  door  for  politicizing                                                               
decisions.  She noted  that there  aren't many  applicants for  a                                                               
managerial position  that is currently  open in her  division and                                                               
SB 352 doesn't help that situation.                                                                                             
KIM  PETERSON testified  from Juneau  and to  say that  she is  a                                                               
senior management  consultant who  has worked in  human resources                                                               
for 27 years. She said, "I  consider myself a loyal and dedicated                                                               
state employee and this legislation  would directly impact me....                                                               
It infers  an inability to be  loyal to the employer  while being                                                               
associated with an employee association."  She said she is deeply                                                               
offended  because  this  assertion  ignores her  long  record  of                                                               
demonstrated loyalty  and "to  now suggest at  this time  that we                                                               
are or can no longer be loyal is completely unfounded."                                                                         
Although she  could see that there  might be an issue  with labor                                                               
relations  and at  times with  collective  bargaining, she  noted                                                               
that  "collective bargaining  has  gone on  for  years and  labor                                                               
relations has found  a way around that. Folks  in labor relations                                                               
covered by  collective bargaining in the  confidential bargaining                                                               
unit do  not bargain  that agreement. They  have other  people do                                                               
it. There is  another way around it and it's  been done for years                                                               
and I would suggest it could continue."                                                                                         
She asked members to table the legislation.                                                                                     
ASSISTANT  COMMISSIONER JARDELL  maintained there  is a  conflict                                                               
nonetheless. "We don't let our  attorneys when they represent the                                                               
state represent two  different agencies. We draw  the line. There                                                               
is a direct  conflict of interest and the fact  that the CEA unit                                                               
is  bargaining in  a  coalition -  we can't  get  around it  this                                                               
SENATOR GUESS  told the assistant  commissioner that he  made the                                                               
point that  there is a  conflict with the  confidential employees                                                               
but  she  didn't  believe  he had  validated  the  conflict  with                                                               
managers.  "I still  don't understand  why  professionals have  a                                                               
conflict in doing their job."                                                                                                   
CHAIR GARY STEVENS asked her to  please hold that thought. It was                                                               
after  5:00 pm  and he  was concerned  that some  people couldn't                                                               
stay much later.                                                                                                                
SENATOR GUESS agreed.                                                                                                           
STEVE  SCHROF testified  via teleconference  from  Kodiak to  say                                                               
that he is a  state employee and is opposed to  SB 352. He didn't                                                               
think this bill would attract many new state workers.                                                                           
RON COWAN testified via teleconference  from Anchorage as a state                                                               
employee who  would likely  be affected, but  he was  speaking on                                                               
his own behalf.  He said he would send his  full written comments                                                               
in a day or so.                                                                                                                 
The comment  that state employees  who, by  someone's estimation,                                                               
don't  sufficiently  support  a  policy brought  forward  by  the                                                               
governor  should  not  be  retained  is  of  great  concern.  "By                                                               
extension of  that philosophy,  we then have  to accept  that any                                                               
other  appointed officials  should  be followed  in like  style."                                                               
Unfortunately,  not all  of the  people that  are appointed  come                                                               
with a lot of experience  and background and sometimes they don't                                                               
appreciate  the ramifications  of  certain  policy decisions.  He                                                               
said he  is concerned that a  manager may be identified  as not a                                                               
team player  when that's not the  case at all. They  might simply                                                               
be  trying to  point out  that there  may be  problems associated                                                               
with a certain action. He said  he saw this happen when he worked                                                               
for the state of Washington  in a management position that wasn't                                                               
protected by a  bargaining unit. He learned that  long time state                                                               
employees were  unwilling to testify on  sensitive issues because                                                               
they were afraid of losing their jobs.                                                                                          
CHAIR GARY  STEVENS thanked  Mr. Cowan  and asked  him to  FAX or                                                               
email his comments.                                                                                                             
MIKE HARBAUGH  testified via teleconference from  Mat-Su and said                                                               
he has worked for the Department  of Corrections for 10 years. He                                                               
made   the  point   that  department   policy  changes   when  an                                                               
administration changes, "but the  professional managers under the                                                               
appointed  positions  bring some  continuity  to  each and  every                                                               
department."  As an  employee he  appreciates that  fact. Putting                                                               
managers in who  blindly obey isn't about what is  good for state                                                               
government, he asserted.                                                                                                        
TAPE 04-14, SIDE A                                                                                                            
5:15 pm                                                                                                                       
TIM VIAVANT testified via teleconference  from Fairbanks and said                                                               
he is  a 17-year  state employee  and was  testifying on  his own                                                               
behalf.  Although he  didn't believe  that he  would be  impacted                                                               
directly, he  views the  legislation as bad  public policy  for a                                                               
number of reasons.                                                                                                              
First,  the  bill has  the  potential  of politicizing  decisions                                                               
managers make  on resource use  issues and protecting  the public                                                               
trust.  It also  has the  potential of  disrupting continuity  in                                                               
management  each  time  there  is  a  change  in  administration.                                                               
Furthermore,  he   thought  the  bill  might   negatively  affect                                                               
recruitment and retention of  managerial positions. Although it's                                                               
unclear  how  many positions  will  be  affected, it  appears  as                                                               
though school principals, people  in borough and city governments                                                               
administering  contracts, and  university department  heads would                                                               
be included. He urged the committee to oppose the bill.                                                                         
SAM TRIVETTE  testified from Juneau  as a retired  state employee                                                               
who spent  24 years  of his  career as a  manager. He  took issue                                                               
with page 1,  lines 8-10 and said  he never found that  to be the                                                               
     I  effectively  managed  one specific  program  for  18                                                                    
     years in a partially exempt  position. I don't think my                                                                    
     effectiveness    in   implementing    numerous   policy                                                                    
     initiatives was in  any way hampered by  not having the                                                                    
     undivided  loyalty of  the managers  working for  me...                                                                    
     I've thought  a lot  about the  managers I  worked with                                                                    
     over  the last  few  decades in  public employment  and                                                                    
     there is only one manager  whom I think shares the same                                                                    
     belief  as this  bill and,  frankly, he  was terminated                                                                    
     from his  position, for cause, after  serving less than                                                                    
     10 months.                                                                                                                 
     I  could  give  you numerous  examples,  Mr.  Chairman,                                                                    
     about  how  collective  bargaining  has  helped  smooth                                                                    
     thing  over  in  management  and  how  supervisors  and                                                                    
     managers have  helped save the  State of  Alaska money,                                                                    
     how an awful lot of  litigation has been avoided by the                                                                    
     work  of the  unions working  with the  management over                                                                    
     the years.                                                                                                                 
     The  current  system works,  there  is  no need  for  a                                                                    
     change. The  bill would be detrimental  to carrying out                                                                    
     the state's business.                                                                                                      
SWITGARD DUESTERHOH  testified via teleconference from  Kodiak to                                                               
say that  she is a  state employee and was  representing herself.                                                               
She said, "The bill would not  affect me now, but it might affect                                                               
my future career choices."                                                                                                      
DUANE  MORAN  testified  via teleconference  as  the  first  vice                                                               
president for the  Anchorage Council of Education.  The intent of                                                               
the bill is  to ensure that an employee is  loyal to an employer,                                                               
but public employee loyalty should  be to the citizens of Alaska,                                                               
he  asserted. "With  existing  collective bargaining  agreements,                                                               
managers  can  have a  professional  difference  of opinion  with                                                               
their boss  with minimal concern for  retribution." He summarized                                                               
by saying that collective bargaining  provides for fair treatment                                                               
and it ensures that hiring  and promotion are based on principles                                                               
of  merit and  that any  disciplinary action  is for  just cause.                                                               
Finally, disputes are settled by  arbitration instead of the more                                                               
costly court system.                                                                                                            
FRED  YATES testified  from Juneau  as a  state employee  who was                                                               
representing himself. He made two  points: "Undivided loyalty, to                                                               
me, means  political appointees. I  don't know how you  get there                                                               
other wise."  Second, the bill  applies to  him and may  apply to                                                               
his  front line  supervisor. "I  don't think  450 [employees]  is                                                               
even  close to  the number  of people  this would  affect if  the                                                               
language in the bill stays the same."                                                                                           
KEVIN CLARK testified  via teleconference from Kodiak  as a state                                                               
employee  who was  speaking  on his  own behalf.  He  said it  is                                                               
unclear whether  the bill would  directly affect him or  not, but                                                               
he didn't  understand how  the stated  intent of  the legislation                                                               
could be accomplished as written.                                                                                               
     Previous  testimony indicated  that  one  intent is  to                                                                    
     ease  the  transition  between administrations  yet  it                                                                    
     binds  employees' loyalties  to  the administration  in                                                                    
     power at the time not to the resources we manage.                                                                          
     It also has been stated  it only pertains to high level                                                                    
     employees, but the language of  this bill suggests that                                                                    
     anyone   with  emergency   order  authority   could  be                                                                    
     reclassified  under  this  proposal   -  not  just  the                                                                    
     ambiguous  high level  employees. How  deep would  high                                                                    
     level  go?  Would   it  include  regional  supervisors,                                                                    
     regional   managers,  area   managers,   down  to   the                                                                    
     assistant managers?  The language  is unclear  at where                                                                    
     the cutoff would  be. It could become  a blanket policy                                                                    
     once written to all to  anyone who deals with execution                                                                    
     of policy.                                                                                                                 
     An  additional  intent of  this  proposal  is to  bring                                                                    
     Alaska in line with other  states. I would suggest that                                                                    
     we do not  do this. I am against "48ing"  of Alaska. We                                                                    
     should act  as an  example; we have  a system  in place                                                                    
     that works for us Alaskans.                                                                                                
     The reason  given for  needing this  change is  been so                                                                    
     the administration can have  better control over policy                                                                    
     and the people  who carry out that policy.  That is the                                                                    
     point  of the  bill  - control.  Disputes and  problems                                                                    
     involved  in  any  administration's  execution  of  its                                                                    
     policies  should be  handled  on  a case-by-case  basis                                                                    
     solely based  on merit.  We cannot  increase protection                                                                    
     by removing it. We cannot  stabilize a system by trying                                                                    
     to  tie it  to  political change.  We  cannot stop  the                                                                    
     brain drain by telling  managers and supervisors not to                                                                    
     think.  It's all  too Orwellian.  I do  not support  SB
JIM SAMPSON testified via teleconference from Anchorage as                                                                      
president of the Alaska AFL/CIO. He stated:                                                                                     
     As  you know,  it's been  the policy  of the  state for                                                                    
     over  30 years  that  public employees  be granted  the                                                                    
     statutory  right  to  share   in  the  decision  making                                                                    
     process. The  Legislature determined  in 1972  that the                                                                    
     best  way  to do  that  was  to grant  these  employees                                                                    
     bargaining rights.  It's worked  well for 30  years and                                                                    
     still works well today.                                                                                                    
     It's  interesting  to  note that  the  Commissioner  of                                                                    
     Administration  has  put  forth this  bill  along  with                                                                    
     Governor  Murkowski  when  the sponsor  of  the  Public                                                                    
     Employee  Relations  Act   was  former  Governor  Terry                                                                    
     Miller of North Pole.                                                                                                      
     The  scope of  the bill  hasn't really  been determined                                                                    
     yet. It's  our belief  that it  will have  far reaching                                                                    
     impacts  to all  kinds  of  public employees  including                                                                    
     state, municipal, school  districts including teachers,                                                                    
     non-certificated employees, and university employees.                                                                      
     Mr. Chairman, you and your  committee should not be led                                                                    
     down this  path. This is  a fight you don't  want. This                                                                    
     is a union busting bill in  its purest form and will be                                                                    
     viewed as  union busting by  not only  public employees                                                                    
     in  your  district  and throughout  the  state  -  from                                                                    
     Barrow  to Sitka  and into  Kodiak and  Anchorage -  it                                                                    
     will  be  viewed   as  such  by  every   union  in  our                                                                    
     The  arguments  put  forth  by  the  administration  to                                                                    
     justify the  legislation are not supported  by 30 years                                                                    
     of  history  under  PERA.  I   have  a  little  bit  of                                                                    
     experience in labor management  relations over the last                                                                    
     25 years in this state.  As it relates to public sector                                                                    
     bargaining, I had the  responsibility to administer the                                                                    
     Public  Employees Relation  Act  from 1986  to 1990  as                                                                    
     Commissioner  of  Labor  including  the  time  when  52                                                                    
     school districts  were brought  into the Act  itself. I                                                                    
     also had the  law applied to me when I  served as mayor                                                                    
     of the  Fairbanks North Star  Borough for two  terms in                                                                    
     the 90s. I've also had  familiarity with the Act as one                                                                    
     who has represented public employees.                                                                                      
     To suggest  that public  employees who  are represented                                                                    
     in the  title of collective bargaining  cannot be loyal                                                                    
     employees  is  wrong. I  probably  have  a little  more                                                                    
     experience  in  the  public sector  managing  employees                                                                    
     than   some   that   have  testified   today   in   the                                                                    
     administration. I can tell you  that over those years I                                                                    
     have worked with hundreds  of extremely loyal employees                                                                    
     and loyalty  has nothing to  do with  bargaining rights                                                                    
     or  not. It  has everything  to do  with how  you treat                                                                    
     Mr.  Chairman,  the  Legislature  has  too  many  other                                                                    
     important things  to do than  spend time on  this bill.                                                                    
     In closing I  want to tell you  what Governor Murkowski                                                                    
     said when he ran for office in 2002.                                                                                       
          QUESTION: Do you believe all workers should                                                                           
           have the right to organize for the purpose                                                                           
          of collective bargaining?                                                                                             
          ANSWER: Yes I support the current law.                                                                                
          QUESTION: Why?                                                                                                        
          ANSWER:    Because    the   lives,    working                                                                         
          conditions  and health  care of  all Alaskans                                                                         
          are   often  bettered   by  the   efforts  of                                                                         
          organized labor.                                                                                                      
VICTOR  WINTERS testified  from Juneau  as a  state employee.  He                                                               
pointed  out  that  "in  the  findings there  is  no  mention  of                                                               
managers  formulating  an  effectuating   policy,  but  there  is                                                               
mention of undivided loyalty to implement policy."                                                                              
To  his knowledge,  no one  has  questioned the  administration's                                                               
right to  define departmental goals  and objectives.  "Failure to                                                               
faithfully  implement  state  policy  is  obviously  grounds  for                                                               
disciplinary  action." He  objected strongly  to the  implication                                                               
that state  policy would be  implemented effectively were  it not                                                               
for  the divided  loyalties of  unionized state  managers. "Union                                                               
membership has no impact on implementing state policy."                                                                         
Another  implication   is  that   once  employees   with  divided                                                               
loyalties  are  removed  from collective  bargaining,  they  will                                                               
effectively  implement state  policy  or be  replaced by  someone                                                               
that is loyal.  "This is likely to have a  rather chilling affect                                                               
on  relations between  elected  officials,  appointees and  state                                                               
managers and  will have  a paralyzing  affect on  some management                                                               
KEVIN  BRENNAN  testified  via  teleconference  from  Kodiak  and                                                               
identified  himself  as  a  state  fisheries  biologist  who  was                                                               
speaking for  himself. He thought  he would be  directly affected                                                               
by the legislation. The assistant  commissioner said the Governor                                                               
was elected to make policy changes  and SB 352 says that managers                                                               
must  give their  undivided loyalty  to employers  to be  able to                                                               
make those policy changes. However,                                                                                             
     Alaska fisheries  have developed  over many  years from                                                                    
     the days of federal  management through early statehood                                                                    
     through the  current Board  of Fisheries  process. It's                                                                    
     been  a long  and complicated  struggle to  protect the                                                                    
     rights  and  livelihoods  of  the  various  commercial,                                                                    
     sport and  subsistence users  of those  resources while                                                                    
     maintaining  the  health  of  these  resources.  A  key                                                                    
     component  in   this  struggle   has  been   to  remove                                                                    
     fisheries  managers from  the  pressures  and whims  of                                                                    
     public opinion and political change.                                                                                       
     As a  fisheries manager, I  know that my  decisions are                                                                    
     to be made  in the best interests of  the state fishery                                                                    
     resources and the authorized  users of those resources.                                                                    
     You can  rely on my  unbiased expertise. I  work within                                                                    
     the  allocation  plans  created by  the  Board  of  the                                                                    
     Alaska    Fisheries    developed   after    years    of                                                                    
     collaboration by user groups  with technical support of                                                                    
     local biologists.  In most  cases, resources  are fully                                                                    
     allocated and  my actions always seek  to maintain that                                                                    
     delicate balance  while ensuring the health  and future                                                                    
     production of the fisheries.                                                                                               
     SB  352  would  force  this  to  change.  My  undivided                                                                    
     loyalty would  be to  my employer  not to  ensuring the                                                                    
     health   and  future   production   of  the   fisheries                                                                    
     resources or  to the people  of the state of  Alaska. I                                                                    
     could   be  summarily   dismissed  and   replaced  with                                                                    
     political yes  mans that  would do  the bidding  of the                                                                    
     employer.  The  personal  opinions  of  my  supervisors                                                                    
     could  replace careful  consideration of  what is  best                                                                    
     for the resource.                                                                                                          
ASSISTANT  COMMISSIONER  JARDELL said  he  wanted  to respond  to                                                               
comments  made about  fish  and  game policy,  "which  is a  very                                                               
passionate and very important issue to the state." He continued:                                                                
     They  keep  referencing  the Board  of  Fish  and  Game                                                                    
     created the policy and we  implement it and we need the                                                                    
     protection  because  we're  implementing  that  policy.                                                                    
     This legislation does not  affect people that implement                                                                    
     -  carry  out  policy.  This  legislation  affects  the                                                                    
     people  that   formulate  policy.  Formulate   it,  not                                                                    
     implement  it and  that's  the  distinction. If  you're                                                                    
     implementing  policy this  legislation will  not affect                                                                    
     you. If  you're formulating the policy,  it does affect                                                                    
     you.  And  we  think  that  is  appropriate  and  we're                                                                    
     talking  about  loyalties.   We're  talking  about  the                                                                    
     divided  loyalty between  having to  be a  member of  a                                                                    
     group that  has interests for  the group as  opposed to                                                                    
     the  loyalty to  the state  in formulating  policy that                                                                    
     may have  adverse interests to that  group. When you're                                                                    
     formulating policy, that has  impacts to the group that                                                                    
     you belong to  that is a conflict and  we should expect                                                                    
     loyalties  to the  State of  Alaska that  are undivided                                                                    
     between  the union  and the  state  when we're  talking                                                                    
     about  the formulation  of policy.  And that's  the way                                                                    
     we're using the  term, in the context  of the loyalties                                                                    
     between the union and the state - the people.                                                                              
SENATOR GUESS stated for the record that:                                                                                       
     One of the  issues - and as you know  I work in policy,                                                                    
     I  have  degrees  in  policy  and  I  even  am  a  self                                                                    
     proclaimed  policy wonk  - you  don't define  policy in                                                                    
     here and so  I think - besides that as  you know I have                                                                    
     problems with the bill in  general and don't support it                                                                    
     - that's  a serious problem.  I think just from  a bill                                                                    
     standpoint of whose going to  define what is policy and                                                                    
     when we get into  these scientific matters - hatcheries                                                                    
     or some  of the fish  things that  you brought up  - is                                                                    
     that policy or  is that science. And I  think that this                                                                    
     bill is unclear at this  point about defining that so I                                                                    
     see that  those comments have some  validity although I                                                                    
     understand your testimony.                                                                                                 
ASSISTANT  COMMISSIONER JARDELL  responded  by  saying that  "the                                                               
precedent  has been  developed through  the  application of  this                                                               
language  and  we  are  adopting  the  precedent  that  has  been                                                               
decided. That is where we give  the clarity in the application of                                                               
the definitions  of policy and  how it applies.  That restrictive                                                               
reading of  the formulation of policy  - and that's where  we get                                                               
it and that's how we define it -  and adopting that is how we get                                                               
that precise nature of what we're looking for."                                                                                 
SENATOR GUESS  questioned: "Just  to clarify, that's  the U.S.C.S                                                               
[National Labor Relations Act] that you're referring to?"                                                                       
ASSISTANT COMMISSIONER JARDELL said that is correct.                                                                            
JERRY  GUAY  testified via  teleconference  from  Anchorage as  a                                                               
state  worker  who  was  representing  himself.  He  said  he  is                                                               
frustrated with  the bill and  resents the implication that  as a                                                               
state worker  he can't be  trusted to do  his job. He  has spoken                                                               
with  his supervisors  and  directors to  find  out whether  they                                                               
believe he and  his fellow workers are performing  properly or if                                                               
there are  control problems when  a manager must delegate  his or                                                               
her  authority  to a  union  worker.  No  one felt  that  problem                                                               
existed,  he  said.  "I  believe  that our  role  is  to  support                                                               
leadership  and we  perform regardless  of the  administration or                                                               
what type of  leadership exists." The system isn't  broken and he                                                               
questioned why the governor wanted to fix it.                                                                                   
MARI MEINERS testified  from Juneau as a state employee  who is a                                                               
member  of the  state  supervisory bargaining  unit. She  clearly                                                               
stated  that she  was representing  herself. Although  she wasn't                                                               
sure  that the  bill  would  affect her  job  because  it was  so                                                               
vaguely worded,  she wasn't  sure that  her opinion  would change                                                               
regardless. She made the point that,                                                                                            
     Commissioner  Miller, in  an  email  last Friday,  said                                                                    
     that individual  employee rights will be  protected and                                                                    
     classified employees  affected by the  legislation will                                                                    
     remain  classified employees  with all  the protections                                                                    
     of the state personnel  act. Unfortunately, without the                                                                    
     assistance, short of hiring an  attorney, I don't think                                                                    
     that I  or many people  that I know have  the knowledge                                                                    
     of  the  personnel  act, the  time,  or  the  expertise                                                                    
     necessary to  defend myself against what  I consider to                                                                    
     be an unwarranted state disciplinary action....                                                                            
MS. MEINERS  stated that she  is surprised and insulted  to learn                                                               
that  the administration  doesn't  believe that  she  can't be  a                                                               
member of a bargaining unit and  also a loyal to her employer. "I                                                               
don't  think the  two are  mutually exclusive.  I would  say that                                                               
most people derive  personal benefit from doing  what's wrong and                                                               
not doing what's right. In Commissioner Miller's email..."                                                                      
CHAIR GARY STEVENS asked her to say that again.                                                                                 
MS. MEINERS clarified, "That it's  not doing the right thing that                                                               
gets you  in trouble it's  doing the wrong thing."  She continued                                                               
to comment on the commissioner's  email that said, "Our intent is                                                               
not to remove  protection for employees, but to  create a career-                                                               
service  management  position  in the  classified  service."  She                                                               
     There are plenty of  current career-service managers in                                                                    
     the   state   who   also  participate   in   collective                                                                    
     bargaining.  There are  also many,  many devoted  loyal                                                                    
     state employees who  also are members of  unions. It is                                                                    
     possible to have both.                                                                                                     
DON ETHERIDGE,  Juneau Public Employees Local  71 representative,                                                               
spoke in opposition to SB 352. He  said, "We think it is going to                                                               
have far more reaching affect than what is being talked about."                                                                 
With  regard to  the loyalty  issue, he  expressed disappointment                                                               
that this  is even  a question. He  described these  employees as                                                               
tough but  fair and that  has nothing to  do with being  union or                                                               
non-union.  "They know  what their  job is  and that's  what they                                                               
ALBERT JUDSON testified  from Juneau in opposition to  SB 352. He                                                               
advised that he was testifying  as an outsider and simply because                                                               
the state is in economic trouble.  He outlined the history of the                                                               
union movement  and brought up the  Taft Hartley Act of  1947 and                                                               
the National Labor Relations Board.                                                                                             
He  made the  point that  the labor  relations board  members are                                                               
appointed  by  Congress and  this  results  in  a board  that  is                                                               
hostile to labor  and friendly to business.  He concluded saying,                                                               
"Whenever labor  unions have suffered,  the United  States itself                                                               
has suffered.  If SB 352 passes  it will no longer  be called the                                                               
Last Frontier, it will be called the Lost Frontier."                                                                            
FRANK ZMUDA said he is a  state employee, but he was representing                                                               
himself. He made two points:                                                                                                    
   1. The language is vague and if a certain group is targeted                                                                  
     then the bill should make that clear.                                                                                      
   2. The Constitution states that all citizens are to be                                                                       
     represented in government. In addition, unions provide                                                                     
     protection for their members against unforeseen or                                                                         
     unscrupulous activities.                                                                                                   
CHAIR  GARY STEVENS  thanked everyone  that  testified and  noted                                                               
that a number of questions were  brought up and further study was                                                               
needed. He announced that he was holding SB 352 for the time                                                                    
being and asked the committee if they had any comments.                                                                         
SENATOR GUESS asked the Chair if he would give the public more                                                                  
than a days notice when he scheduled the bill for the next                                                                      
CHAIR GARY STEVENS agreed that the request was fair and he would                                                                
try to bring the bill up the following Tuesday to address                                                                       
questions that committee members might have.                                                                                    
There being no further business to come before the committee,                                                                   
Chair Gary Stevens adjourned the meeting at 6:00 pm.                                                                            

Document Name Date/Time Subjects