Call to Order and Roll Call
The first meeting of the Budget Review Subcommittee on General Government, Finance, and Public Protection of the Interim Joint Committee on Appropriations and Revenue was held on Tuesday, November 29, 2011, at 10:00 AM, in Room 131 of the Capitol Annex. Senator Jack Westwood, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Jack Westwood, Co-Chair; Representative Royce W. Adams, Co-Chair; Representatives Leslie Combs, Mike Denham, Adam Koenig, Tom McKee, Tanya Pullin, Steve Riggs, Tom Riner, and Wilson Stone.
Guests: Corey Kline, Special Assistant, Office of the Secretary, Finance and Administration Cabinet; Robin Morley, Special Assistant, Office of the Secretary, Finance and Administration Cabinet; Lynsey Womack-Denney, General Counsel, Department for Local Government; Jamie Mangeot, Local Government Advisor, Department for Local Government; Tamara Sandberg, Executive Director, Kentucky Association of Food Banks; Marion Guinn, CEO, God's Pantry Food Bank; David Neville, Manager and Auctioneer, Capstone Produce Market; Brian Riendeau, Executive Director, Dare to Care Food Bank; and Walt Gaffield, Director of Administrative Services, Personnel Cabinet.
LRC Staff: Tom Willis, Frank Willey, Katherine Halloran, Perry Papka, Jennifer Rowe, and Spring Emerson.
Smart Government Initiative
Robin Morley and Corey Kline, Special Assistants, Office of the Secretary, Finance and Administration Cabinet, provided an overview of the Smart Government Initiative (SGI), which was launched in January 2010 by Governor Beshear.
In response to a question from Chairman Westwood regarding the self-insured fleet, Ms. Morley said there was a separate fund in the accounting system for the payment of claims and the agencies are issued a premium which is a source of revenue for the fund. She stated she would provide more information regarding investments at a later date.
In response to a question from Representative Stone, Ms. Morley said energy savings performance plans are components of a comprehensive energy management plan for state facilities. Ms. Kline added that there is no statewide formal audit in place.
In response to questions from Representative Adams, Ms. Morley said reductions have been made in the number of vehicles in the fleet and global positioning systems (GPS) were installed in all state vehicles, which includes trucks as well as passenger vehicles. Ms. Morley will provide a summary of requirements for contractors' vehicles at a later date. She also said that practices were adopted and mandated for all vehicles owned and managed by the Division of Fleet Management, which is approximately 50 percent of the total state fleet. Those agencies which are not governed by the Executive Branch are encouraged to adopt those best practices.
In response to a question from Representative Denham, Ms. Morley said part of the audit process is comparing wireless telephone subscriptions to actual usage as well as comparing number of users and number of calls on landline telephones. Ms. Morley will provide actual savings realized by the SGI at a later date.
In response to a question from Chairman Westwood, Ms. Morley said health insurance projections are based on past claims history. She added that actual savings would not be realized until the first twelve-month period has passed.
Representative Riner commented that many of the small post offices in rural areas are facing possible closure as they try to cut back on expenses. He said if there is a decrease in postage, the post office would probably be cut, along with the jobs associated with it.
Area Development Fund
Lynsey Womack-Denney, General Counsel and Legislative Liaison, and Jamie Mangeot, Local Government Advisor and Manager of the Area Development Fund, Department for Local Government (DLG), provided an overview of the Area Development Fund.
In response to questions from Representative Adams, Ms. Womack-Denney said the variance in amounts in the Area Development Districts (ADDs) are the result of the 60/20/20 formula, based on population, manufacturing employment, and per capita income. Each county is allotted an amount based on that formula then it is distributed by the ADD. Ms. Mangeot said current regulations require that projects be completed within two years. Ms. Womack-Denney added that Area Development Funds are separate from coal severance dollars. She will provide information regarding the agency budget request at a later date.
In response to questions from Representative Koenig, Ms. Womack-Denney said funding is no longer based upon coal severance, it is now all General Fund dollars and is very important to local governments.
In response to a question from Chairman Westwood, Ms. Womack-Denney said priority is given to those who have matching funds. Ms. Mangeot added that the amount of matching funds depends on the project.
In response to a question from Representative Riggs, Ms. Womack-Denney said the local governments must have balanced budgets in order to receive ADF dollars.
In response to a question from Representative Riner, Ms. Womack-Denney said she would work with him at a later date regarding the distribution of computer equipment being retired from manufacturers.
Kentucky Association of Food Banks
Tamara Sandberg, Executive Director, Kentucky Association of Food Banks; Marion Guinn, CEO, God's Pantry Food Bank; David Neville, Manager and Auctioneer, Capstone Produce Market; and Brian Riendeau, Executive Director, Dare to Care Food Bank, provided an overview of the Kentucky Association of Food Banks (KAFB) and the work they do to help alleviate hunger throughout the Commonwealth.
In response to a question from Representative Denham, Ms. Sandberg said the KAFB had distributed produce to 108 counties in Kentucky this past summer. She said the reason they were unable to distribute to all 120 counties was a volume issue, and produce had been allocated by the percent of poverty per district. She added that they would contact the Mason County Produce Auction.
In response to questions from Representative Adams, Ms. Sandberg said their budget request would go through the Department of Agriculture. She also said they work closely with the Kentucky Proud program, which had been very helpful in accessing the producers. Representative Adams commented that other states had been using this concept successfully for a number of years. He asked if the KAFB had looked into the Hunters for the Hungry program and Ms. Sandberg replied in the affirmative.
Representative McKee commented that the work KAFB does is extremely important and they are doing a great job meeting the challenges presented.
In response to a question from Representative Stone, Ms. Guinn said the food banks pursue other sources of benevolence in the community and could not operate without that support. She added that more than fifty percent of God's Pantry Food Bank's budget was made up of contributions from individuals, organizations, corporations, and foundations.
Representative Pullin commented that the local food bank in her district was originated with various church groups pulling together with a program called Helping Hands. She inquired as to why this group was not listed on the presentation. Ms. Guinn replied the Helping Hands group were a member agency in the network of food banks and would fall under the Huntington Area Food Bank, which although it is based in West Virginia includes three and one-half counties in Kentucky.
In response to a question from Representative Riggs, Ms. Sandberg said the funds received by the KADF were the result of a one-time grant.
Quasi-Governmental Employees Health Insurance Subsidy
Walt Gaffield, Director of Administrative Services, Personnel Cabinet, provided an overview of the State Group Health Fund as it relates to quasi-governmental agencies.
In response to a question from Representative Adams, Mr. Gaffield said even though some agencies drop out of the program, others come in. He said three agencies are joining the plan in January.
In response to a question from Representative Koenig, Mr. Gaffield said not all counties are included and it is based upon the amount of money available. He added that it is not based on regulations, but rather on head counts. He also said that the Kentucky Bar Association and the Kentucky County Judge Executives Association were members last year.
In response to questions from Representative Riggs, Mr. Gaffield said those members listed as corporate entities fit the definition of quasi-governmental agencies, such as multi-county social services groups. He added that he would provide statutory information at a later date. He also said that quasi-governmental agencies must pay the same premiums and receive the same types of coverage.
There being no further business before the subcommittee, Chairman Westwood entertained a motion to adjourn. Motion was made by Representative Denham, seconded by Representative McKee, and the meeting was adjourned without objection at 11:52 AM.