Good afternoon. I'd like to call this meeting and the Senate Labor and Commerce Committee to order. The time is 1.31 p.m.
We are in Belts Room 105 and Thomas Stewart building in the nation's most beautiful capital city of Juneau, Alaska.
Today is Monday, February 2nd.
Happy Marmot Day, everyone.
Members present are Senator Merrick, Senator Rumbar, senator Greg Jackson,
Senator Yunt, and myself, Sen. Bjorkman.
Let the record reflect that we have a quorum to conduct business.
Welcome everyone to Senate Labor and Commerce.
I would like everyone please turn off or silence your cell phones and join with me in extending.
And especially warm Senate labor and commerce welcome to our recording secretary,
Carrie Tupo and our LAO moderator, Renzo Moises.
Today, we have three items on our agenda.
Senate Bill 170, Gaming Electronic Pull Tabs,
Senate bill 211, Extend Occupational Licensing Boards,
followed up by Senate,
Bill 81, Public Employer Pension Contributions.
First up today is Senate.
Bill 1770.
Today it is my intention to bring a committee substitute
before the committee for consideration.
We'll have some committee discussion
and look to the world of the Committee.
Is there any discussion on Senate Bill 170 before we consider the committee substitute?
Hearing and seeing none at this time may I members have a draft proposed committee
substitute in their packet may have motion please yes, mr. Chairman
I move committee's substitute for Senate bill 170 version 34 dash LS 0 2 1 3 backslash
Oscar as the working document
Object for purposes of discussion my staff the award-winning Conrad Jackson is here to present the committee substitute
Thank You mr. Chairman for the record Conrad jackson staff to senator Bjorkman and the labor and commerce committee
The CS sub before the members for consideration version backslash. Oh has three small changes
the first being found in section 19 on page 8 and in this section we're
bringing parity to the door's door prize limits that you will see in
section 20 switch to that page very quickly here section twenty we made
that adjustment in the prior CS we doubled the current prize
We're higher than that, so we've brought them down into parity to 40,000 and monthly and 480,00 annually.
The next change is on page 15, section 32.
And we are amending AS0515180A2 by deleting references to payments by credits or credit vouchers and to electronically transferred funds.
for the purposes of purchasing an electronic pull tab.
We further amend A3 that, and in doing so we're adding
a restriction that an Electronic Pull Tab system
may not be part of any system that accepts credit cards.
The next change is on page 19, section 41.
And we're amending AS0515188Q, and we are granting a vendor the authority to pay a distributor
on behalf of a permitee.
That is the extent of the changes, Mr. Chairman.
Thank you very much, Dr. Jackson.
I will remove my objection.
Is there any further objection to this proposed committee substitute?
Hearing none.
The CS version, backslash O as in Ozinky, is before the members is a working document.
Is there any further committee discussion on the underlying bill?
Senator Grijakson.
Thank you, Mr. Chairman.
I just want to make a brief comment before we move on about the bill because there's a company that is in my district and
for pull tabs, and they may be negatively affected by the bill that is currently written.
And I just wanted to bring that to your attention, specifically in sections 25 and 26.
But please know that I don't want to slow down the process by no means, but my hope is that this issue can be reexamined more closely as it travels through other committees.
Thank you, Mr. Chairman.
I would like to thank the committee for their time in working on this bill.
It has been a very interesting process working with all the stakeholders in trying to interpret
everyone's self-interest and reminding manufacturers, distributors, and for-profit businesses that
the reason why we have charitable gaming in this state is to allow nonprofits and charities
And that is the reason for this program of paper pull tabs in the state now.
And it is to that end with that goal in mind that I believe it's time to modernize
pull tab in state of Alaska so that charities and non-profits can continue to make money.
Their profits and their ability to raise funds through pull tabs are being squeezed out right now
because of the very high cost of printing paper tickets.
It's gone up by five to six times.
That means much of their profits have evaporated due to that high costs.
Electronic pull tab would bring down that cost and restore charity's nonprofits.
veteran service organizations ability to raise money in an effective way for their groups.
And also the regulations that we put in place here are designed to ensure that one company
who is for profit cannot maximize their profits at the expense of charities, at
Who should be able to raise money without fear of monopolistic control or vertical price integration that would out-compete others and then drive up prices of
The products needed by nonprofits to race money through pull tabs. So it's we I've
Tried my best to structure the bill in this way and I'm excited to see it move through the process as it moves to the
Capable Senate Finance Committee next so thank you all
If there's no further
Discussion, what are the wishes of the committee?
Mr. Chairman, I move to report committee substitute for Senate Bill 170 version 34-Ls 0213 backslash
Oscar from committee with individual recommendations and attached fiscal notes.
Is there any objection?
Object one more time just for the purpose to add that this bill will likely make the
It'll be revenue positive, which in today's fiscal climate would be good.
I'll remove my objection.
Hearing no further objection, Senate bill 170 version 34 dash LS 0213 backslash O as an Oscar is reported from committee with individual recommendations and attach fiscal note.
We'll take a brief at ease while we sign the paperwork and set up for the next bill.
We're back on the record. It's 141 now here in Senate Labor and Commerce. Next up is Senate Bill 211 211.
This is our first hearing on this bill with us to present the bill. We have
one of my team members, Mr. Matt Churchill, mr. Churchill.
Welcome to Senate labor and commerce. Please join us at the table. Thank you very much.
State your name for the Record and begin your presentation.
Chair Bjorkman and members of the Senate Labor and Commerce Committee.
Thank you for hearing Senate Bill 211 today for the record, Matt Churchill, and I'm staff to Senator Bjarkman.
This bill would extend the sunset data five state professional boards, those professional counselors,
marital and family therapy, psychologist and psychological examiners,
social work examiners, end of The Real Estate Commission from their current sunset dates of June 30th of this year.
Senate Bill 211 follows the extensions recommended by the state's audits for each of these boards.
The state audits recommended extending the boards of marital and family therapy and
of social work examiners each by eight years and that's the maximum extension allowed by statute.
The audits of the board's professional counselors and certified real estate appraisers recommended six year extensions.
The audit of a board of psychological and psychological examiners recommended a five year extension.
And finally, the audit the real state commission recommended extending that board determination date by four years.
Chris Curtis, our legislative auditors here today to speak further to the committee regarding the details addressed in the state's audits.
Mr. Chairman, I understand that the committee will be adopting a substitute later in this afternoon's meeting to include the board of certified real estate appraisers in the spill.
And Ms. Curtis plans to address this audit when that bill is taken up at the committees next meeting on Wednesday I believe.
And then also at Wednesday's Meeting Director Sylvan Rob.
of the division of corporations, business and professional licensing as well as some of
the chairs of audited boards will be available for testimony and answer any further questions
by the committee.
The remaining chairs will available as planned on Friday at that meeting.
Thank you for your incentive bill 211.
At this time, we will have our friendly neighborhood and state legislative auditor, Ms. Chris Curtis.
Join us to speak about the audits that she and her staff have performed on these boards and the extension bills before us.
Ms Curtis, welcome again to Senate Labor and Commerce.
Please put yourself on the record and begin your presentation.
Thank you.
There are five boards extended by HSB 211, and I'll be going through the audit reports at very high level.
And fairly quickly, but if you have any questions, please let me know when I can stop and answer them.
So starting off with the real estate commission.
Overall, we found this commission effectively conducted their meetings.
They actively mended their regulations and they effectively were licensing their real estate professionals.
But we did find some areas for improvement in ultimately made five recommendations.
We're recommending overall only a four year extension, which is half of the eight year maximum.
Walking you through the audit on page 10, you'll find the standard licensing statistics.
As of January 2025, this board had 2,854 active licenses in 591 active registrants.
Page 11, and you will find a schedule of revenues and expenditures.
As January 25, there was a surplus for this Board of approximately 807,000.
We recommend the DCBPL's director provide training and update written procedures
to ensure minutes are prepared for all commission meetings.
We found the subcommittee meetings were not having minutes prepared.
In rec 2 on the next page the commission chair should update regulations and forms
to include independent contractors.
The audit found that the real estate industry is moving away from employees
and most licensees are independent contractors affiliated with brokerages.
The statutes were updated in 1998 to reflect this new relationship and the commission did
not update its regulations and its forms.
So all the forms referred to employees as opposed to independent contractors.
Rec. 3, the commissioner should work with policy makers to improve the recruitment and retention
and the DCBPL, the Division of Corporations, Business and Professional Licensing Management
should consider ways to assist the Commission with addressing its investigative backlog.
So we tested 14 cases that have been open for over 180 days, and all 14 had unjustified
periods of inactivity.
Those periods ranged from 160 days to 726 days.
There was a lot of reasons for the delay on some of it had to do with finding a
Member of the Commission to review a case
Next it has to deal with
Commission members taking in an order amount of time to get the review finished and other delays had
To do it with staffing issues like turnover in vacancies
We also noted that from July of 2024 to January 2025 the backlog of
needs to find ways to encourage timely resolution of their investigations.
And then, Rec. 4 on page 19, the Commission should consider seeking legislation to eliminate the Real Estate Recovery Fund.
This Real estate recovery fund was created decades ago to provide a remedy for losses suffered as a result of fraud,
intentional tort, deceit, and et cetera.
But in 2018, a law was passed the required licensees to obtain errors and admissions insurance.
And since the effective date of that legislation through January of 2025 the fund has paid out only around 50,000 in claims.
But it has collected 640,00 from its licensees for the real estate recovery fund fee.
During our audit period, which has been three and a half years, there is virtually no claims paid at the funds.
So in other words, the Fund has outlived its usefulness and we believe should be eliminated.
And Rec. 5, the commission should require all renewal applicants to submit certificates
of errors and admissions insurance, which is a statutory requirement.
Response to the audit begins on page 31 with all parties of management,
the commissioner, or the board chair, concurring with the report conclusions.
If there's no questions, I can move on to order social work examiners.
Any questions from the committee?
I have a couple okay, is the real estate recovery fund is that a sweepable account?
Through the chair no, I wouldn't be a sweetable if the funds were supposed to be used for a certain purpose, okay. Thank you
Thank You very much, please continue
Okay, moving on to the Board of Social Work Examiners.
This Board served the public's interest by generally conducting their meetings in an effective manner by actively amending regulations.
Also, we found licenses were issued in compliance with state law, except for those that were
issued as a result of the online applicant portal, and those applications lacked certain documentation.
We also found one board position had been vacant for an extended period, so we're recommending an extension of eight years.
On page six, you'll find the board's schedule of licensing activity.
As of January 2025, the Board had around 1,300 active licenses.
Schedule of revenues and expenditures is on page seven.
And we conclude that board fees were not set at a level that covered the cost of regulating the profession.
But through general fund allocations,
the boards did not go into a deficit.
We have two recommendations beginning on page nine, first we recommend the office of the governor,
boards and commissions director take steps to ensure the board seats are filled in a timely manner.
And then page 10 we recommended the Board Chair and the DCBPL director work together to insure renewal applications,
comply with continuing education requirements or seek a regulatory change if necessary.
We found that the
online portal for renewing licenses,
to submitting your applications to a new licenses
was not collecting all the information
that was needed for continuing education.
So they standardized the portal, so all boards use it,
but this particular board has more detailed regulations
for collecting certain information
about continuing educations.
So either they change the regulation
or they amend the online Portal.
Management's response to the audit begins on page 21.
Generally, Office of the Governor and DCCD Commissioner
concurred with the recommendations.
The board chair also concur and stated
that the board vacancies have led to delays
in processing applications, canceled meetings
due to lack of quorum, and two delays
in closing out investigations.
So board vacancy are negatively impacting board operations.
And that's it for the Board of Social Work Examiners.
Any questions, please continue now.
Right, moving on to the Board of Professional Counselors.
This Board generally conducted its meetings in an effective manner.
It actively amended its regulations and effectively licensed professional counselors.
They had it also concluded that one Board position had been vacant for an extended period
and licensing fees were not set at a level that covered the cost of regulating the profession.
We're recommending a six-year extension.
If you turn to page 5, you'll see the standard licensing statistics.
As of January 2025, this board had 1,676 active licenses.
On page 6 and 7 of the audit, we conclude that the license fees were not sufficient to
cover the cost of regulating the profession.
But ultimately, the fees were not increased due to non-compliance with a new fee setting process.
If you turn to page 19 of the audit, you'll see a memo from the Governor's Chief of Staff.
And the memo, subject line reads, no tax fee revenue increases without Chief Of Staff approval via this memo.
The Governor's Chief of Staff declared that new and increased taxes, fees, and revenues,
or any other mechanism to collect new or additional revenues must be approved by a Chief
of staff with input from OMB.
So after this memo was released, Office of Management and Budget produced new procedures,
whereby if a department wanted to request a fee increase, they were to submit the request
to the Division of Admin Services, who would then forward the requests to O&B,
forwarded on to the governor's chief of staff for approval.
DCBPL management for this board did submit their request to
Division of Admin Services, but due to staff turnover,
the increased request was not forwarded to OMB.
This board had a deficit as of January 2025 of 210,000,
and we expect the deficit to grow.
Thank you, Mr. Chair, if you don't have this citation off the top of your head, it's fine, perhaps afterwards.
I'm wondering what the authorizing statute is that permits boards to set their fees or recommend their
fees, and I am wondering, you know, where in our statute does it say that that presumably independent
process has to all go to the chief of staff of the governor?
Doubt that's in our statute, and so I'd like to have that citation and figure out
You know what latitudes the executive agencies actually have to
Set their fees
Versus what they are directed by the law to do
Again, I doubt that the chief of staff the governor is named in the statute
Through the chair I'm Senator Dunbar
Alaska Statute 0801 065 requires a department to adopt regulations that establish the amount
in manner of payment of application examination license investigation, registration, and other
fees as appropriate.
And then it goes on to say that it has to cover the cost of regulating the profession.
We believe that these fee increases are statutorily mandated and then by adding two additional
of the fee increase, which would increase the deficits,
which in a sense is pushing the cost of future licensees.
And the worst case scenario would be the agency
coming to the legislature to ask for general funds
to cover the budget deficits of their boards.
Follow-up?
Senator Dunbar.
So in case like this, and maybe this is a question
for the Department of Law, but what recourse
does a legislature have?
So the law you just described,
Lays out the process
It's mandated so it can cover the cost of these boards and commissions
But now the executive agency or city of the governor's office is not following law
What recourse do we have?
Through the chair, I think that's a question for depart for our legislative legal
Fair enough. Thank you, mr. Chair
Yeah, thank you through the chair is our fee deficit's typical and
and what can be I mean how long has that been happening or lasting right and how bad is it gotten through?
Through the Chair looking at this for many many years it was common I would say 10 15 20 years ago.
It was hard for them to increase fees and have those negative impacts to their licensees
and the constituents.
This administration, when it started eight years ago, took a real hard line and, and
the fee analyses were really strong and fee increases and accordance with statute were
passed on to the licensee as appropriate.
It's just recently that we're seeing some of these deficits pop up.
I would say in general this administration has done a really good job making sure that
the boards are paying for their cost of regulation and they've even been padding it a bit to
help.
help the boards from doing the wild swings because setting the fee at a cost of regulating
the profession, if you have a lot of investigative costs, that can result in really wide swings
in your fees, which no one likes.
So they've really been conscious of making sure there's a little bit of extra, making
sure that their fees are covering at least one year, extra year of expenses to smooth
the fees setting process.
Okay, so then it follow up, then in your opinion, this board isn't in trouble fiscally right
now.
It's just this is currently they have a fee deficit, but they're not, you know, they
are not a negative territory for the chair.
They are a native territory.
They're negative 210,000 and eventually their fees will be increased and it will
be pretty shocking.
And the increase will being much more as the bigger the deficit grows.
So it's not doing their licensees any good by letting their deficits grow.
having to jack up their fees.
Follow-up.
Senator Yonta.
Can we, like, should we not be trying to get that done sooner than later?
And what do you think a reasonable timeline is?
Like, I mean, the real estate commission is sitting on an extra 600,000 bucks, right?
Give or take.
These guys are upside down by almost a quarter million.
Like when can we fix that?
Through the chair, that's a great question for the department.
Talk to them about that to the chair. Yes, in fact the license go through a two to your cycle
Okay, so if you miss up increase in the the rate, you're gonna wait two more years
And I'm I am assuming they're going to be coming up for a license increase very very soon here
And i'm sure the department can address that okay follow-up last one. It's under yet. Thank you, sir
Just help me understand then why why we're asking for us six-year-old Steph
Extension on this one and only a four-year on the real estate commission what what determines that through the through
The chair it's very subjective and it comes right from me
Yes, through so I'll never recommend a full extension for someone has a deficit
But if that's the only serious issue a board has it about round about six years now the Real Estate Commission had
some other prop some
other
Issues that we'd like to monitor compliance for corrective action
Okay, thank you. You're welcome. Thank you
Anything further on the board of professional counselors
Hearing and seeing none, please continue moving on to board a marital and family therapy
this board conducted her meetings in an effective manner they
Amended their application. I mean their regulations is needed and they generally licensed marital with family therapists and compliance with state law
The also audit also found that the public board member seat
had been vacant for 32 months as of March 2025. We're recommending legislature extend this board
eight years. Page five the audit you'll find the board schedule of licensing activity. January
2025 the Board had 116 active licenses. Schedule of revenues and expenditures is on page seven
We have two recommendations one going to the office of the governor boards and commissions director and that's to work with the board to identify
Interested applicants to fill board seats in a timely manner and the wreck to we recommend the Board ensure the renewal
License application is sufficient to monitor compliance with teletherapy
Continuum education requirements and those are new requirements that have only applied to licensees that are operating remotely
But the port has no way to identity which of those
licenseeaser
operating remotely, and so they have no way of monitoring compliance with the
continuing education requirements. Management's response to the audit begins
on page 19. All parties of the management concur with
the conclusions and recommendations.
That's the end of marital and family therapy.
Questions or comments?
Okay, moving on to the last of the audits is the Board of Psychologists and Psychological
Associate Examiners.
This board conducted meetings in an effective manner.
They actively amended their regulations and they generally issued new licenses in compliance
with state law.
The audit also found some areas for improvement, which led to five recommendations.
On page six, you'll find the schedule of revenue or a schedule licensing activity.
On page 7, we explained that the board fees were not sufficient to cover the cost of operations.
DCBPL did a fee analysis that supported a fees increase but decided not to forward that fee request to their Division of Admin Services,
which is the new procedure because they believe there would be a backlog.
And they wanted to prioritize other fee types like new license types and get those in.
As a consequence, fees were not increased, the Board had a deficit of 90,000 as of January 2025, and we expect that deficit to grow.
We have five findings and recommendations which begin on page 11.
First, we recommend the governor's boards and commissions director work with the board to identify interested applicants to fill board seats in a timely manner and take steps to ensure qualified applicants are appointed in timely
manner.
WREC 2 on page 13, the board chair and DCBPL's director should work together to ensure renewal
applicants comply with continuing education requirements or change regulations as necessary.
And this again is the online portal that is standardized and does not collect certain
information that's required by their regulations.
W REC-3 on Page 14, board members should review investigative cases in a timely manner.
So we found two cases have been open for over 1,000 days and we looked at those two.
One of them had an unjustified period of inactivity of 656 days.
And that was due to a board member not reviewing the case in a timely manner and a lack of
other qualified board members that could take over the cases.
Rec 4 DCPPL's director should ensure courtesy licensees comply with monthly reporting requirements.
This is the third sunset cycle that we had that finding.
And then rec 5, DCB Pills Director should ensure the board fees cover the cost of regulating the profession.
And the management's response begin on page 27, and all parties to the
management concur with the report conclusions and recommendations.
Thank you very much Ms. Curtis.
Any questions from committee members?
None for me. Thanks. I did have one question that I remembered about
Realtor board
The conversation that you had regarding a change from real to appraisers
to
From employees independent contractors did that raise any concerns with workers comp
Are there any issues surrounding a worker's comp, where they've changed from one designation to the next?
Did you discover any of those issues in your audit?
Chair, no, we did not encounter any issue with workers comp.
The individuals have been independent contractors for many, many years.
It's just the confusion in filling out their application for licensure or renewal that talks about employment relationships.
And those two entities are subject to much different laws, employment laws.
So it would be important to eliminate that confusion.
And we never heard anything about workers comp.
Okay, thank you.
And just for clarity, because I know we're going to deal with appraisers lately.
But this was having to do with the real estate commission.
Real estate appraiser, right, which we'll talk about later. Yep, so okay
All right. Thank you very much
Senator Young
Yeah, I'm doing the chair. I miss this this last board of the psychologist. How many years were you recommended?
Through the Chair. We're recommending a five-year extension for Board of Psychologists
Thank you, Mr. Chairman.
And I've said this before, and I'll say it again for the record.
I really appreciate our auditor and not just extending boards and commissions.
The full eight years when there are findings and there're recommendations, because actually this allows the auditor the opportunity to revisit a board and commission to see if they followed up on the recommendations.
So I'd really appreciate our auditors.
extension timelines.
Thank you, Mr. Chairman.
Thank You, Senator.
We do have some time if the committee would like to hear
from Director of the Division of Corporations,
Businesses and Professional License in Rob.
Are you prepared today?
Certainly, Mister Chair.
Great.
Let's do it.
Please state your name and affiliation for the record and begin your presentation on these audits
Yeah, thank you, mr. Chair good afternoon members of the committee a Sylvan Rob director of The Division of Corporations Business and Professional Licensing
And I apologize. I don't necessarily have my notes in the same order that
Ms. Curtis went through them,
but I will try to stick with her order.
So starting with the real estate commission as
mentioned there were five findings for this, several of them are either directed to the
commission itself to some decisions that they need to make, the recommendation regarding
having the real estate recovery fund as noted that is in statute and so would require a
statutory change, de-authority over those statutes belongs to a commission and it's
The item that the commission has been considering, but it's certainly on our radar that with the change in statute,
many years ago creating the need for errors and omissions insurance that, the Need for the Real Estate Recovery Fund is not a house.
Pressing as it was before the insurance was a requirement.
And we fully concur that the commission should require license renewals for
people to submit that proof of having that insurance that is an issue that's
been resolved since we got the audit findings so that has been taken care of.
We are working to recruit.
We're always working to recruit investigators.
I am happy to report.
Our investigative unit has 26 PCNs in it.
We currently only have one investigator position that's vacant.
So we're having good luck recruiting
and retaining members of that position
that is vacant, we just had someone retire.
ensuring that the division is a good place to work and that is somewhere where people
can see a career ladder for themselves and they see away forward that that
is the environment we've created so that staff want to stick around because
there's a fairly steep learning curve and we invest a fair amount into ensuring
that our investigators are well trained so we want make sure we hang on to those
folks.
I think, next, Ms. Curtis reviewed the social work examiners.
I, think nearly all of the audits that Ms Curtis
reviewed, one of findings is that we need to make sure that the board seats are filled.
works hard to find suitable applicants for those seats.
We do what we can to help them with social media posts
that the department puts out.
I'm trying to reach out to industry associations
and others to encourage folks who might be interested
to apply for board seats and again on a number
the findings were related to renewals.
Many of those renewal issues were
related too telework.
Obviously, tele work is something that's relatively new.
That's really blossomed since the pandemic.
So all of
those findings related
renewals and making sure that we have either the documentation we need about
continuing education or whether people are conducting therapy via telework.
All of those are included and have been resolved. So we
have a great team who works on our mental health programs and we really
appreciate legislative audit, highlighting those deficiencies for us and
we got those resolved probably in less than a month so updated forms and
So we look forward to the next audit.
Very well.
I don't really feel like I need to go through all of these point-by-point, Mr. Chair, but
I'm happy to, if you would like, there's enough findings, happy answer any questions.
It sounded like there may have been a few from committee members, sort of hold on to
questions, Senator Dunbar.
Thank you, Mister Chair.
Thank You Director Rob.
Some of the recommended fee increases not being able to get through the
Administrative process and the administrative process being different or perhaps more stringent than what is recommended
Or I'm sorry. What is laid out in our statute do you have any comment on that or the likelihood of those fee
increases going through soon so to prevent you know a
Catastrophically large fee increase in the future
through the chair to Senator Dunbar we do have so statute requires that all of
our fees be set in regulation so once we receive that approval to increase those
fees then we need to do a regulations projects and those fee increases are
all in that process of becoming a regulation and so as soon as they get
As Ms. Curtis mentioned, we do try to keep a little bit of a question so that we can keep
fees for professionals from being too volatile. We really don't want them to ping pong all over.
That makes it hard for people to plan for their business and just know what's coming.
For the programs that are in deficit,
we anticipate that as soon as we're able to make that change to the fee,
we'll see those programs coming out of deficit.
you know, when we're recommending an increase have a longer horizon so that we are not trying
to clear that up in a couple of years and have it be a big swing for people or a
big hit. So we can flex things a little bit to cover as we get them out of deficit.
So, we keep track of all the books to make sure people are only paying for what they should pay
for, but in terms of getting staff paid and paying the rent,
come out of deficit a little bit more gradually.
Thank you.
Follow up, Mr. Chair?
Indeed.
So Ms. Curtis had mentioned that these fee changes
were being routed through the Chief of Staff
of the Governor's Office.
Is that true?
Is it your understanding?
And if so, is that permitted or laid out in statute
that our regulatory changes have final approval
with the chief of staff of The Governor?
Through the Chair to Senator Dunbar, that is not laid out, specifically in our statutes,
as Ms. Curtis mentioned, the statute that authorizes our fees is AS0801.065.
It does not mention other members of the executive branch, and so, but I wouldn't care to comment
what else might be hiding in the executive budget actor.
So I will know my, know, my limits.
Thank you, Director. Further questions?
No, thank you Mr. Chair. Senator Yont.
Yeah, Thank You Through the Chair, so you talk about paying payroll and keeping the lights on and
everything. How do you do that when you're negative over $200,000, the professional
Regular public person out there watching the meeting today like how do they pay to keep that?
You know that board going when they're down over $200,000 who's paying the bills
Yeah, that's a great question through the chair to Senator Yount.
So the division of corporations, business and professional licensing is just one allocation
within the state budget, the entire division.
So each of our boards or programs are not line items in the budget.
So we, because of the statute I just mentioned, 0801.065, it requires us to charge a license
that to the cost of regulating that profession.
We keep very close track of how much money is spent on each of those programs.
That being said, we operate as one unit and
so we can pay our bills with,
we know that other programs have a surplus.
Everybody has the accounting of the funds that they need, but
To the average person it may seem like the real estate commission is paying the bills for their professional counselors
Right or right ones up over 600 grand ones down over 200 grand. That is like to me just I don't know
It's not working in my mind
Quick question. What is what is it like this shortest?
term. We've got one here that's four years, one that five,
one the sixth, and two that eight. What is, what is like,
what would be the shortest time that you would extend one of these boards?
Yeah, through the chair to Senator Yant,
I just want to reassure the public that, you know, real estate commission
licensees are not paying for professional counselors.
That's how it looks. I can understand that but we do
Someone is paying. Somebody is paying. Not them, but yeah.
Yeah, certainly I feel like the question of the shortest extension is really a question for Ms. Curtis.
I do know that it takes a period of time for them to conduct the audit.
So the shortest one I've seen is two years,
but that's really question from Ms Curtis to answer.
Final question, I think it'll be my final one.
Will we see this SB 211 again in our committee one more time before leaves? Okay. I'm good for today. Thank you
Director Rob could you please just expand on your your answer a little bit about
How the monies for these boards are accounted separately and how they're tracked to make sure that the licensees
That each board regulates are responsible to pay for the cost of regulation of their profession
Yeah, thank you for that question, Mr. Chair.
And so I will hold this up, which will not be terribly helpful for the public.
But, and this is obviously way too small to see.
But so this the kind of accounting that we provide for each of our programs.
And, so, this lays out the expenditures and revenue for
each program.
So we literally have 45 spreadsheets that were using to track the different programs to ensure that
associated with their program.
So obviously we track their revenue
and then we try expenses using cost accounting.
So individuals, many staff only work on one program,
so it's pretty easy.
Like I work in the nurse licensure team,
all I ever do is look at nursing applications.
We have a number of smaller programs
that have fewer than 100 licensees
and so obviously that doesn't keep someone busy.
full-time year-round and so they work on different programs and
so, they keep track in the same way that maybe an attorney or an accountant or other people who
do billings to say, you know, I spent two hours today working on
Morticians, and then I spent six hours working on real estate appraisers to ensure that each
of those programs is paying for the appropriate amount of time.
So we track staff time in that way.
We track investigator time based on it.
We tracked time for staff who work on all of the programs, so our publication specialists
who maintain the website and update forms, they track.
down to 15-minute increments like which programs they're working on, and then we have allocation methodologies for
all of the overhead that break the cost out relative to the size of
the programs to ensure that each program is paying for its costs and nothing else.
Very well. Thank you. Okay. Anything further on this item? Okay, thank you very much.
At this time, we'll set Senate Bill 211 aside for further.
My apologies, I did forget a step.
Thank you for reminding me, Madam Vice Chair, appreciate that.
So at this, there is a draft proposed committee substitute in members, packets.
Senator Merrick, may I have a motion, please?
1, 2, 5, two, backslash November as the working document.
Object for purposes of discussion.
Once again, here to present the changes in this committee substitute is Conrad Jackson.
Mr. Jackson, welcome back.
Could you please state your name for the record and present these changes.
Thank you Mr Chairman for
the Record Conrad, Jackson's staff to Senator Bjorkman and the Labor and Commerce Committee.
The CS before members for consideration backslash and next just a couple of changes that were alluded to a number of times today during the hearing first changes a title change on lines four and five.
Where we are adding the board of certified real estate appraisers following that new section five is inserted which extends the Board of Certified Real Estate appraiser is from 2026 to 2032.
And then we have a minor change
to the retroactive date in the bill.
The current bill has July 1st, 2026.
The new CS changes that back to June 30th, 26.
Not much of a change, but a changing nonetheless.
Thank you, Mr. Jackson.
Our remove, my objection.
Is there any further objection to this committee substitute?
Hearing none.
committee substitute backslash n as before the committee as a working document.
Senator Dunbar.
Thank you, Mr. Jaws.
I was wondering if we could hear again from Ms. Curtis just briefly.
We can't, Ms Curtis, welcome back.
Senator Dumber.
Thank You, Mister Chair.
So, Miss Curtis going off off a question that Senator Yunt asked earlier.
concerns about the sort of the board of certified real estate appraisers they're
deficit and the administration's new found policy. What is the if we were to
amend that number to 2027 for example or 2028 if it's 20 27 are you required to
do another audit or can we use the results of this audit in that decision?
Next year and if we you are required for whatever reason to do an additional audit or an update how long does that take?
through the chair
statutes require that an audit be conducted the year before
The term determination date, so I would have to to another audit. I do not encourage any
termination dates that's less than two years because I have staff right now
starting dot it's already we already have our audit our employees staffed on
projects so you have to take a whole nother two
years at a minimum. Two years have been limited to those that have serious
public safety concerns like investigations that need to be dealt with
like and we can't we didn't can discuss the issues because it is a
confidential investigation or a million dollar deficit.
And one time, so it's very, very unusual to have such a short time.
If committee members have big concerns and want follow up, there is another way to do it.
And they've put a requirement for legislative audit to follow-up, a finding in the un-cautified law of a bill when it was passed.
And then they require me to come back to the LBA committee to provide a current status.
So that's one way of.
holding your finger on an agency or commission to make sure an audit finding
is addressed without requiring a full audit.
Follow up, Mr. Chair. Indeed. Well, thank you. That's good information.
And I don't think any of us believes that this board has those severe.
issues. However, it also sounds like there's now been a broader policy change in the Mayor's,
sorry, the Governor's Office, that will impact presumably every other board going forward unless
that is resolved. And so I would expect next year's series of audits to reveal a number of
deficits if the governor's office is not approving the needed fee changes to cover the
expense of the boards. So it's an interesting issue where on the one hand, this particular
board isn't a large challenge. But if every board has this problem next year, then we've
got a problem.
So what I guess would be your recommendation to us and how to address this challenge?
Through the chair, you make a really good point that this is not limited to these specific
boards, This is two out of five that have a deficit and their fees are not increased
impacting all the boards. I really don't have a solution as far as how to deal
with it.
I've seen letters written. To what extent you're going to impact the executive
branch's decision to have two extra levels of approval to change a fee.
I don' t know at the
what the separation of powers and to the degree to which legislature can impact an executive branch
duty? I follow Mr. Chair. Yes. I'll go to Senator Young. Just a very quick one getting again to
Senator young's earlier questions though when there's deficits is backfilled through general
funds correct so. Through the chair in the past the department has come to legislature and asked
There was general funds being allocated to boards every year to mitigate the financial impact.
Because there was a fee freeze that was done to mitigate the financially impacts of that.
So, but there have been in the past requests for there
was one allegation that they had a bad methodology of allocating indirect costs.
So they fixed it but put a bunch of boards in deficit.
There's been a lot of reasons over the years of why they have to come back.
You know, one of the things that could happen as a result of this but more likely is that
the future licensees will end up paying the cost of previous licensee's when their fee
is increased.
Thank you.
Thank You, Mr. Chair.
Senator Young.
ThankYou through the chair.
You have future licensee's or eventually just the general fund.
I'm not saying this is going to happen or that I want to offer a friendly amendment.
But what would happen if we just pulled one of these boards out and didn't extend it at
all?
Can you explain to us in the public what happened in that case?
Sure, through the chair.
The licensing and the operations would continue, they would be monitored by the Division of
Corporation of Business Professional Licensing.
of a profession making the regulations these are unpaid volunteers providing
their expertise and it would increase into steer rising here it'd increase the
need to contract for specific expertise when you're doing regulation projects
and that type of thing so and if you did not license them this year they do go
into one year admin wind down period so they did
They have a one-year wind down.
And, you know, by all means, it would increase the need for that.
Like you said,
it will also increase a need
for someone to maybe allow the fees to come up,
you don't.
Well, yeah, I'm not going to make that amendment,
especially not today,
I don t think,
but it is,
it s worrisome to me.
When I hear that we don' t really,
we do not really hit the panic button
until there are a million dollars upside down,
that s just seems,
yeah.
It's very fiscally irresponsible, that's all.
The chair, one last comment.
I don't believe the fee setting is impacted by the board itself.
The board goes away.
The fee process has not changed.
That existed before the Board.
So the division is the one that actually is responsible
for setting the fees, not the Boards.
Very well.
Thank you.
an excellent opportunity to maybe even have a joint hearing
with this committee and the Community and Regional Affairs Committee
with the department to talk about board process
and talk of this conversation because there has been quite a bit of talk
of chloroforming some boards and then we just have the Department take on all
of their responsibility as you just heard from the auditor
that could have opposite of the impact desired because you would really
It would be a terrific way to grow government and bureaucrats, but I certainly don't want
to do that.
We have all these professionals that are willing to
do the work of investigating and creating regulation that makes sense for their profession.
And those are the people doing the
work and that're immediately affected by those regulations.
And then to somehow give that work to bureaucrats and expect to get a better
Thank you for that. Okay. Is there any further where are we at? We already did that?
I removed my objection to the CS. It is before the committee. Thank
you. And at this time, we will set Senate Bill 211 aside for further consideration
at a future meeting. We'll take a brief at ease while we set up for the next bill.
Back on the record it is 231 now in Senate labor and commerce next up. We have Senate bill 81
We first heard this bill last year during those hearings we heard a presentation of the bill today
It is my intention to hear a recap of The bill take public testimony and look to the will of
The committee with us today for recap
Of this legislation we have the honorable Senator Bert Stidman and his staff Margot Youngberg
Welcome back to Senate Labor and Commerce. Please put yourselves on the record and begin your brief recap of the bill
Thank you, Mr. Chairman
Bert Stebten Center from District A all the islands in Southeast and two communities of Yakutat and Hider
I'll just I got about a page and a half here base in half. So it's not too painful
But it it is a nice little brief recap, mr.. Mr.. Chairman
For the past two decades, the unfunded liability
has significantly impacted the finances
of both non-state public employees' retirement system
employers and the state of Alaska.
Senate Bill 81 advances the State's effort
to reduce the unfunded liability
by providing the Alaska Retirement Board
with the flexibility needed to adjust
the 22% contribution rate.
With input from municipal employers,
the Alaskan Retirement Management Board
would have the authority to increase or decrease rates to achieve the measurable reduction in the unfunded liability and
stop
deferring the cost that
inevitably grow the liability near the future and for those watching at home this dates back about 20 years to the
unfunted liability we're talking about that we've been carrying on the books.
In
2006 the Alaska retirement board
set the employer contribution and
rates at the full actuarial rate, which meant the arm board would set a rate to pay all current
contributions needed for that given year plus whatever's needed to retire the unfunded liability.
But in 2008, as employer contribution rates surged and placed significant strain on
municipalities and school districts, the legislature capped the public employee's retirement system
percent through Senate Bill 125.
The state assumed responsibility for the difference between the cap and the actuarial required contribution.
We're leaving local governments of the excessive financial burden.
And the reason we did that is the rates were getting so
excessive we thought that we would be bankrupting some communities all around the state.
So the states stepped in, capped it at 22% of payroll, and picked up the balance.
which was significant from both perspectives.
The state assists the payments of a municipality
and other PERS employers
remain entirely funded by the unrestricted general funds.
And we all know what's going on there, it's getting tighter.
And for those watching at home,
maybe we're talking hundreds of millions of dollars here.
We're not talking pocket change.
In this current upcoming budget, this rate was expected to be about 270 million from the
arm board.
The governor has put 232 million in the budget.
That's one year.
Those rates are forecasted to escalate year on year going forward.
So we've got to definitely take a look and get this thing under control.
At the local level, a contribution cap represents 22% of the aggregate payroll.
Approximately 9% that amount goes towards the normal cost.
The current year's benefit calculation for the active employees,
while the remaining roughly 13% is applied to the unfunded liability.
And that's the accurate across the state.
Each community is different.
Each member is a little bit different, depending on your balance of what tier you're in and stuff.
Generally speaking, it's 13% of the aggregate payroll.
So when you think of City Hall,
you can take a look at your entire payroll
and 13%, is this burden going to the unfunded liability
that has to be funded through property tax or sales tax
or some mechanism.
Removing the 22% cap
and bringing non-state PERS employers
to participate in the discussion
of setting a rate would encourage both communities in the state to pay down the
liability sooner rather than later and not try to shift the liability from one
entity to the other and the State has been very creative over the last two
decades and shifting is more this burden on to City Hall to
the tune of probably pushing a couple billion bucks by just the way they
So on and so forth.
So this bill would bring everybody at the table
to have that discussion.
Doesn't say they have to change the 22%,
but says they could lower it, or they can raise it.
But I could assure you it will increase
the participation rate in the discussion continuing
these policies of the past 18 years as resulted in.
decades of payments toward exhausting the liability.
The extension continue to burden our communities while also hindering the ability
to potential allocate the monies toward critical local priorities.
And that priorities could be salary increases, lower taxes,
more money for their school functions, whatever the individual community wants to pay.
when we look forward the next couple of years and
We're asking the finance to get updated numbers on this
They're looking at ratcheting up these contribution dollar amounts into the future and
We need to have the
All members of the of this system at the table discuss this and then set that rate
And ideally, it would be nice to extinguish its liability.
So it's not passed on to future generations.
It's gone on for 20 years and forecasted to go on
for another 20-years.
That's 40 years.
So with that, Mr. Chairman, that is,
in essence, what this bill is.
It is a sticky issue to talk about,
and no one likes to talked about this,
especially the magnitude.
We rarely talk
about it in the budget process.
We just fund it.
But it's a couple hundred million dollars and that's bigger than our capital budget
That's Bigger
Then our school funding increases. It's big than a lot of things and
Just for those watching at home. Don't don't
Assume
Because it would not be true that this that there's any
Liquidity crisis within our retirement plan and there is any issues of non-payment
That is not the case at all
What we're talking about is the paying off the future unfunded liability.
And it's guaranteed by the constitution of the state of Alaska that we cannot diminish benefits.
So nobody's going to miss any payments, no payments are going be late.
And in essence, Mr. Chairman, that's what this bill puts on the table.
Thank you very much, Senator Seman.
Senator Dunbar has a question.
Thank you, Mr. Chair.
And I apologize if we had this conversation last year, and I'm just not recalling.
You mentioned this 22% cap, but unless I am not seeing it here, there's no repeaters in this bill.
So where does that 22 percent cap live, is it in regulation, not statute?
How does this sort of obviate that cap and allow the on board to go outside if there is no repealers in the bill?
I think well, will you put that in?
And we would have to, my understandings would
have too a repeal it, but we'd have
to check on that, because what we want to do
is have the flexibility within it.
Senator Yont.
Yeah, thank you through the chair.
So the couple of things, I just want
to make sure that us here and everybody watching
has a good understanding of it so this has been about 18 years
that we've been paying this unfunded liability.
And I think I've heard before that it could last until about 20-30 diet or so, so maybe another, you know, 13-14 years, right?
If we do what you're talking about here, would that give us the ability to pay it off sooner by making larger principle-reducing contributions to the problem?
And if so where would the money come from? Would that be the state participating at a higher level or local governments?
in the portfolio, or more cash going in pretty much is the issue.
So I'm not convinced that it's going to stop in 2039 at all, the way it looks to me.
It's gonna continue on the discussion between the municipal or the non-state and the members
and we'll be an ongoing discussion. We set that rate years ago at 22, we the state set it at
22 percent and it's been there for a long time. we were hoping a decade ago that we'd be able to
go under the 22% and see bratching it down, but the State changed some of the amortization and
Giving it some flexibility
Senator yand
Do you know what percentage of that you said we're spending over 200 million a year right now
Do know, what percent of jive that is principle reducing and how much of? That is interest
That's a good question I couldn't really tell you
Because they really don't break it down that way
It's like on a mortgage. I wish that I could because of you know, it would it what simplify it
Well, those are things that
I I suppose can be answered at the finance table to obviously I assume that the next committee after this one would be finance
And so but it wouldn't be nice to see, you, know if you start looking at at The AM table
Amorization how much we're
Chipping away at that problem right now and how, much is this interest
And if we made an extra $50 million or $100 million contribution now,
what would that do, how many years would it reduce, and so on and
so forth, so thank you, sir.
Mr. Chairman, just for a quick note, back in 2015, fortunately,
we can't really work with $ 100 million, or 50 million dollars in this situation
because it goes into a bucket and disappears.
We put $3 billion in, $ 3 billion.
It goes kind of to your question. If you put a big chunk of money in, it does lower the amount
owed, right, and lowers your payments. But if you continually stretch your
payments out, you never catch up to it. And our liability back then was, the end of that year,
was $6.5 billion. That's around $7 billion is what I'd expect the report to come out this year.
So you're seeing in 2015 it was $6.5 billion and what is it today?
Mr. Chairman I don't have that number yet for FY26 because it or FY25
somewhere around with a combination somewhere
around $7 billion, $0.6 and a half billion we'll find out.
Yeah we heard that we hear that
number from the House Majority Leader when he presented last week yes.
All right, well, I wish you well in this battle.
I'm looking forward to I will follow it closer when it gets to the Senate financing.
Mr. Chairman, can you amend it or?
Before Mr Chairman some good news, before the year before, the 3 billion, that includes.
Well, let me just say before that, it was about 8.3 billion.
from 8.3 you threw in an extra 3 billion and then we then
we owed 6.5 billion. And we went down from there. These
numbers are so big, the compounding is scary. When the
compounds against you. I got one senator. Last one. Whose
idea was it to extend the amorization table? Who refinanced
what year was that numerous times there's been discussion in methodology change
by the Alaska Retirement Management Board that board does that they send their
recommendations in into the administration for inclusion in the budget in this
current year FY 27 we're working on which starts the first of July their
that we pay 270.2 million, that's 270 million.
The budget on the table has 232 million in it.
So they're recommending a higher contribution
than the governor submitted in his budget.
And then the legislature has not taken action.
Yet, because it's the beginning of the session, last year was 218, I think, 8.8 million.
And again, this is just for then funded liability.
This isn't your ongoing benefit structure that people earn every year, right?
This is the interrears.
So it is significant.
discussion on this bill is dealing with health care it is in surplus but we can't
use that money in the pension unless you want to go to jail. Thank you Senator
Simmons. I do not want go jail thank you. And the further questions for the
bill sponsor. One more follow-up. So senator got to. 218 last year
and the governor's proposed budget.
Does that just cover an interest or are we like chipping away
at this or is it just kicking the can down the road?
Mr. Chairman, I think there is some concern
that the cans been kicked and getting pretty dented.
There, think the testimony I put on the table last year,
which would be, now we'll have a new update this end of June.
But we bid.
Couple million bucks or so and we were in the same place. We were ten years ago
So when we look back in time and this goes way back as I've been involved in this unfortunately for 20 years 20 some years
We thought the unfunded liability would cap out at about eight billion and
We'd have it exhausted in 15 years or So
And the problem was in health care. Well, we solved health. Care
We've got a surplus in healthcare and the pension
We've had the inability to get control of this thing,
control the meaning, get the unfunded liability down.
But if the state did not step in to assist the communities,
a lot of them would have went broke.
The first one that would've went down would
have been Fairbanks.
At the time, we thought that Anchorage would
have survived, but in retrospect,
looking back, I don't think Anchorage
woulda survived. They wouldn't have even broke too.
So we're the last entity standing,
the State of Alaska,
Which we did but
But it's been up. It's an ongoing challenge. Yes
Thank you, sir, seven
Thank You that was a bit of a
Walkdown decades past in our state history, but senator Yante
I think you're correct as you kind of identified
Appropriations to pass service costs or essentially
Making up for the the gap
investment long-term to pay for pension payments that the state will have to
make years past or years to come as a gap and you can call it whatever you call
but there's bills we have pay in the future right and so we
have no danger of missing payments or missing bills so oftentimes in a regime
What's been done even back in the 90s, and I believe this caused a big part of the problem with Tier 2,
the retirement system, is that people shot to make payments into that plan that were at the very lowest end of
the lowest estimate of what those employer contributions should be.
And so, of course, money now is pretty important,
and then time value of money then compounds as we've discussed here.
And so we have a situation where we are at now, once again,
do we follow the recommendation of the arm board
to make a full contribution to meet their target date
to pay off in 2039?
Or do you extend the amortization by short funding that
so that it can be future politicians' problems?
That's ultimately the question here.
And the expedient answer has been in the past,
well, we're just going to play less now
future Alaska worry about the rest, which is not, in my opinion, the right answer.
Functionally, this bill, operationally as the state can contribute more,
local communities are capped at 22%.
This bill functionally would include local community's in paying more to pay off the unfunded liability faster.
Is that summary rather correct?
do that cost shifting and make it 25% or some other number they could do
that or they can make a 20% and push more burden on to the state.
But I think we're going to have some lively conversations at the arm board
of getting us exhausted because when I look at committee, Mr. Chairman,
I see some youth sitting here in front of me and I date back 20 years.
Some of you into the workforce has been burdened by this,
your entire working career, if you were 25 and now 45.
And when you're 65, I don't think it's going to be
extinguished if we don' do something about it.
So your, entire, working careers, paying for benefits
that were accrued in the 60s, 70s 80s and 90s.
I think there's something wrong with that.
Thank you.
The bill sponsor brought forward a slight change as we have
Discovered here a bit of a I guess you call it a non-sequiturable so may have a motion Madam vice chair
Yes, mr. Chairman
I move the conceptual amendment number one which deletes section one of the bill in its entirety as found on page one lines five through 12
Object for purpose of The explanation senator stebman
I think we're dealing with the tourist issue. Yes, sir. Yeah, the way this was written the tours tours is not is this
The state assumed everything over the normal cost for teachers
Otherwise, we'd be just passing it on through the BSA and around
so the 22 percent doesn't really account
Is not applicable to the terms the purse is where it's concentrated and that's an oversight in the bill
Because we're not going to have the school board start paying for the unfunded costs.
That is the education's responsibility of the state.
That's why the State took the entire unfunted liability and didn't leave it at City Hall.
Thank you Senator Stebman.
I'll remove my objection to conceptual amendment number one is a further objection.
Hearing no further objection conceptual amendment number one passes
We will go now. Oh
We have comment from Senator Dunbar. Thank you, Mr. Chair
I just want to return to my earlier question here as we're amending this bill if we are going to report it out
so I
Still don't quite understand this Bill expands the authority of the arm board which makes good sense
but if the 22 percent cap still lives in our statute somewhere, how does the arm board go beyond
that cap? But then I also look in the supporting material. It says the cap was repealed in 2021,
but I assume that was a cap on something else. So can you just help me understand a little bit
more why we don't need to amend in any repeaters? Well, I think through the chair,
I think I'll have to get back to you on the technicalities of it.
That's because if it needed an appeal or it would have been put in there by Ledger Legal.
So I'd have go in and look at that.
Yeah, well I appreciate that, I guess these, the challenges.
We I, think the intention is to move it out of committee today.
If we need additional questions to be answered, we can hold on to this bill.
I think, well, I'm not trying to slow down the bill intentionally.
I assume that if there is an issue, you'll resolve it at finance.
So I guess I don't require to do it here.
We can speak offline if that is in issue.
It'll either be resolved or financed or certainly before it goes to the floor.
And I would bet that there are people waiting to testify under public testimony that can
speak to your question.
Thank you, thank you Mr. Chair.
Any further questions or comments?
Hearing none, at this time I will open public testimony
if each testifier could clearly state their name and affiliation and
We will hold testimony today to three minutes
Public testimony is now open. Is there anyone in the room who wishes to testify to Senate bill 81?
Hearing and seeing no one wishing to testify to this item. We will go online to the catch-can LIO and
Go first to SINNA
Gubitio
Ma'am, could you please state your name and affiliation for the record and begin your testimony?
Good afternoon, my name is SINA GUBITIO SNIF. I am the assistant barrel manager for The Catch-Can Gateway Barrow
Regarding SB 81, the 22% CAF was negotiated in 2008 under the PERS Restructuring Plan,
which was intended to address the unfunded liability, while giving municipalities a predictable
cost share.
Our borough has beautifully paid its share of the net pension liability ever since.
Our community's current share, of PRS, net pensions liability is now over $57 million
That's for a total community of about 13,500 people and whose population is declining.
As far as the end of the amortization date, the original amorization period was set up
at 25 years to end in 2030.
In 2018, that date was extended to 2039, and there was huge discussion around that subject.
In an April 29, 2025 presentation to the House Finance Committee, The Gallagher, I think they're
told the committee that the unfunded liability is not projected to reach full funding until
2048. So that's already a significant cost shift from the state to various municipalities.
Since 2016, the Catch King Gateway Borough Assembly has adopted multiple resolutions
The assembly reaffirmed that position as recently as December 1st, 2025, and I am now
conveying to you the assembly's opposition to increasing the person's terms contribution
limits.
Thank you for your time.
Thank You Ms. Gubitayo.
I see no one new in the room wishing to testify, but if anyone in
the Room would like to test if I can jump up at any time, raise your hand and we'll get
you in line.
We'll go next to Anita Foren.
Please state your name and affiliation for the record
and begin your testimony.
Yes, my name is Anita Thorn.
I'm the finance director for The City of Dillingham.
I was standing in for Steve Carrier,
who is our council member.
And since he's not present here,
I am going to hand the phone to him.
All right, this is Steve Carrier.
This is Student Carrier City D
D
With the removal of the cap and the reduction of
the ability for the state of Alaska to continue to assist us over the last seven
years, we've had an average of $188,000 that has assisted the citizens of doing
ammo. There's been years that have spent over a quarter of a million dollars and
it's a highly necessary funding source that we have because
I mean it absolutely benefits our community. Smaller communities like
And that's one of the hardest things to have to fund for and having a predictable cost
with a community of under 2,500 and declining, this would be a very hard
reality to try to physically prepare for. So as doing him, we would oppose the Senate Book
Thank you very much for your testimony
We'll go next to Donna Adderhold. Ms. Adherhold, please state your name and affiliation for the record and begin your testimony
Hi, thank you. My name is Donna Atterhold and I am commenting on
SB 81 on behalf of the Commerce City Council and
I really appreciated the
presentation by Senator Steadman
really appreciated the discussion amongst the committee members. So thank you for
that. The City of Homer is opposed to increasing the 22% employer contributions
of Kurds. We believe that the current contribution is fair and an increase
would unfairly burn municipalities and other Kurds employers and you have
And, you know, we also feel in addition to some of the other testimony,
we feel that the municipalities kind of inherited this problem from the state
and continuing to increase the employer contribution is a cost shift
from state down to the municipality.
We recognize that this is really serious problem and it's one that needs to be dealt with.
and municipalities in any conversations about a change,
municipalities and other employers need
to have a seat at that table.
Thank you very much.
Thank very to Ms. Adderhold.
Is there anyone else in the room or online
who would like to testify to Senate Bill 81?
Hearing and seeing none at this time
I'll close public testimony.
We'll also take a brief at ease.
On the record, 302 PM.
Some additional questions and points of interest
have arisen from committee members about Senate Bill 81.
So we will not be looking to the will of the committee
to move this bill out today.
Instead, we'll put some questions together
in writing to The Department of Administration
and likely the arm board as well
about what their intentions are in the future
and then what actually is.
as possible and enforce right now in statute that is driving some of the policy choices
that are being made by the armed board as well as municipalities about what it is they
are doing.
So I think we'll leave it there for today and take this up at a future meeting.
At this time, there is no further business to come before the Senate Labor and Commerce
Commerce Committee today. We will meet again on Wednesday when we will once again take up
Senate Bill 211, our suite of board extension bills, and talk about other bills under bills
previously heard.
We are adjourned at 3.04 PM.