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Senate | June 16, 2015 | Committee Room | Appropriations Base Budget, Part 2

Full MP3 Audio File

I call this meeting back to order, I would say good morning but then I'd be lying so I'll say good afternoon to you, this time I'd like to recognize Senator Herington for a motion. Thank you Mr. Chair, I'd like to know that we hear the PCS on house bill 97. I have a motion to hear to the PCS do you have a second? Any discussion? All those in favor let me know by saying aye. Aye. All oppose [xx] No. Well, the motion passed, barely it passed yeah it passed. Thank you Senator [xx]. At this time we have reviewed the, the chairs have reviewed the amendments and those that we found to be appropriate for this budget we're going to allow and this time we'll have Senator Brown come up with his amendment, and I would ask the sergeant of arms to pass that one out please Senator Brown I recognize you to explain your amendment Mr. Chair Yes Sen. Harse you don't have copies okay [xx] Okay sergeant at arms we found our second roll missing we'll give him just a few more minutes Okay Alright, I think all the members have gathered. Everybody got a copy now, OK Senator Brown please proceed. Alright, I'll try to run through this as quick as I can, how about that? Okay the first one on page one lines one through seven just makes a clarifying change to the minor report to specify when DMV fees were last adjusted. Next piece is on page one lines nine through 14, makes a technical change to the Wildlife Resources Commission Boating, safety account to actually reflect the amount of motor fuel tanks proceed to be transferred by department of transportation for the 15 through 17 biennium. Page 1 lines 16 through 17 makes technical changes to fix the formatting for two sets story citations and the provision dealing with the use of private council for the rules of view commission. Page 1 lines 19 through 26, it makes change, change is to ensure the funds are available to complete the study of the use of broken hospital facilities that was authorized in the 2014 budget. Page 1 lines 28 through page 2 lines 18 replaces section 9.1E and F with updated teacher salary the line it was just clarifying and technical and more correct. page 2 line 20 through page 3 line 16, make changes to provide funding for mitigation of impaired water bodies. Page 3 lines 18 through 20 makes technical changes to fix some error and the effective date for the human relations commission provision in section 27.7. Page three line 22 deletes provision that authorizes AOC to establish a [xx] reimbursement rate for transportation by privately owned vehicles that are rated less than the business standard mileage rate set by the RIS because this authorization is already contained in this statute. Page three line 24 makes technical change to fix an error and affect a day for department national cultural resources provision in section 14.30. Page three lines 26 through 31 extends sunset for two years for the state policy concerning participation by disadvantaged minority owned and women owned business in transportation contracts page three line 33 through page six line seven requires the use for the net proceeds of revenue received by county from the per capita allocation for public education and community colleges purposes, and authorizes the remaining that proceeds received by a county to be used for any public purpose. Page six lines nine through 10 [xx] directive to the ducks to apply to all beer produced in the state instead of just crack beer produced in the state page six line 12 though 21 replaces

closure of the museum a [xx] a cut of 150, 000 and one position. Page 6 lines 23 through 30 removes [xx] purposes from the senate provision and reverse in the house provision with administrative funding removed. Page 6 lines 32 through 41 provides 100, 000 non recurring funds to the Renaissance West Community Initiative. page seven lines one through to seven, directs the consultative services bureau of department of labor to inspect mines and quarries in a manner consistent with the inspections previously conducted by the mine and quarry inspection division. Page seven, lines nine through 17 expands the authorized use of funds in the Court Information Technology Fund, to rise from State Judicial Facility Fees from the upgrading maintenance and operation of phone systems through the upgrading maintenance and operations data connectivity. And page seven lines 19 through 32 clarifies authorization for the director of [xx] to contract with third parties for the provision of remote access to court records. Water cleanup. Thank you Senator Brown, the chair will entertain questions at this time. Senator Brown. Just inquiring as to the location of the [xx] Science West Community Initiative. That is in [xx] any other questions on this amendment? Senator Blue I want to make sure Mr. Chairman and to Senator Brown that the section I got so tired up looking at this funny stuff relating to sales tax I forgot my section number. But the provision related to the page two, the environmental management of impaired water bodies, wanted to make sure I fully understand that provision replaces the provision that specifically mandates that the same experiment in [xx] Lake be replicated in False[sp?] Lake so basically it allows False[sp?] Lake to continue doing what we've been doing to try keep the drinking water there clean? That's my understanding.yes.ok. Other questions for the committee? If not the chair would entertain a motion OK. All those in favor of this amendment, being in favorable to the bill, favorable to, no not yet, just the amendment, okay, just a minute okay. All those in favor of this amendment let it be known by saying Aye. Aye. All opposed [xx], the ayes have it, thank you Senator Brown, this time we'll hear from Senator Brock on his amendment, I'll ask the Sergeant at Arms to pass that out. Thank you Mr. Chairman, the following amendment. Hold on Senator, do all the members have a copy? Amen, yes sir. Okay, thank you Mr Chairman hold one second Senator Brock, we still lack a few on the second row back there gentlemen Senator Randleman eight to one and Senator Logan Okay, I think all the members have I will announce, Senator Brock please continue Thank you Mr. Chairman, this amendment simply will strike program evaluation vision study, the graduation rates at our constituent institutions, they recommend policies, we look at where we've had students to struggle not only with graduating in time with their majors but also the significant cost and the cost burden that we have upon our students when there graduate, after they graduate what the have to pay for their off their debt and this just instructs a study from program evaluation. Okay.

Senator Blue. Senator Beckmam, I'm reading this are you seriously suggesting that they ought to study whether average kids can't be admitted to the university because everybody would have to have at least a B average? Senator Blue, what we're trying to look at our university system is to make sure that the University of North Carolina for the people of North Carolina that is actually producing students, they can graduate on time which we're looking at those instead of a four year rate we're looking at six years when they are taking time to graduate but also the amount of debt they incur to make sure that we're trying to keep the public education as lower cost as possible. Follow up Mr chair. Follow up senator Blue. And I agree with that but I'm just trying to understand what this directive is, it says that among the the things that study is where the implement let's see including but not limited to increasing the minimum high school GPA required for admission to 3.0 which is the average, are you you suggesting that kids with below of 3.0 are they not ought to study below 3.0 should be admitted to the university? Well, thank you Mr. Chairman, well part of the studies to see that in some studies it shows that students with a lower than 3.0 may have a motive what time they are graduating may be they need to go to alternative instead of going to the four year school, maybe look at the community college, but also look at with the waited average they do have on GPA's that would be over but if we have someone that want to struggle from the beginning we may want to look at our current estimate to make sure that in starting off with a four year school may not be the best right before then. Okay, I heard Senator Robinson. Several questions Mr chair just to the amendment more so. Yes. Senator Brock are you aware of studies that the board of governors have already done in terms of the requirements and what research says about the requirements for kids coming in to be successful, are you aware of any work that they have already done well if they've done some work we just want to make sure that through our program evaluation that we're looking at the overall impact. This amendment was brought to me by a member who doesn't sit on this committee so we had to amendments that are brought forth in this committee have to be brought forth by someone who sits on the Base Budget committee. So this allows program evaluation to do it and it goes under the program evaluation oversight committee. Follow up? Yes, follow up. As someone who has been a part of the university system, Senator Brock, don't you think that the university system and its evaluation committees, it has academic extra several committees, one which is to do this very thing and has already looked at these issues continuously, don't you think that they would be more appropriate? to do this, then program evaluation at the state level. Well Senator Robinson since you sat on that committee, maybe you can enlighten it committee of health help the studies that you are part of. How they've worked or they haven't worked, and while we hear from parents that the cost of college keeps going up and up and up, making it tougher for the kids to go to school and some may be struggling when they get in to school. Normally they struggle with their academics, but when they get out to pay off their debt. So your time on the board of governors, what is your study? What if your background, what is it showing to where we are today? Follow up. Be glad to answer that, and ask a couple other questions as well? No ma'am let's just take the questions please Senator Robinson. Okay deal. Thank you Mr. Chair, I'd be glad to share my knowledge, Senator Apodaca. What we've done with that is he's will to, I don't disagree that the loans are concerned, in terms of what key is accumulate, however, my response on, I got an answer to the question I'm sorry, but I think it's more appropriate for the board what are governors and it does have several committees that look at issues like this and is continuing to do that, would be their most appropriate to address these issues. Thank you Senator Robinson. Senator Ford. Thank you Mr. Chairman, Senator Brock did we change the rules that would not allow somebody to graduate from our system with less than a 3.0? No. Mr. Chairman to me this is irrelevant because if students can graduate with less than a 3.0, we don't need this study. Thank you Senator Ford Senator Tucker. Just a question for Senator Brock and, I don't know perhaps Senator Robinson did answer this, what is the

average length of stay for a student that attains a four year degree at the university system now I heard it moved from four years to five point two years and I'm just trying to see that relevance with what the study is from Senator Senator Brock you want to?  I don't have an answer to that but if it has taken 5.2 years to graduate you would just take those numbers that the amount of length of time it would take you to graduate means more debt upon the student, and it maybe because they're struggling more and so this maybe not just looking at the university system, but looking at our primary system to see that if the students are graduating with a 2.0 or 3.0, are they are actually prepared for our four year schools. Okay, Senator Apodaca. Thank you Mr. Chairman, Sen Brock is this a study or are we implementing policy? It should be just a study. Program evaluation I believe is a standing committee so I believe we're not starting anything else or are we? No, we just go to studying to the committee. Okay, one last question, that dead horse there how much longer are we going to kick it? Senator Don Davis. Thanks Mr. Chair my question is when we look at and we talk about deferred admission program, I'm actually studying this and also we're talking about how to implement it for students who are at risks we are, we propel peepy[sp], We say that we have sophistication in our systems now to deal with at risk students, my question would be with there being a benefit then to while we're studying things, study how effective we are not only identifying but actually responding to intervention so that perhaps we're not spending as much time on a deferred admission program. Senator Brock  I think that a good part of it is to make sure when the students are graduating former schools whether it's a 2.0 or a 3.0 they can to make sure they are prepared, and when they do go in to our universities to make sure that they can pay for it because one thing it was interesting of family members have gone through college recently about how much the cost of college has gone up and up and up, each year when we have those families that are struggling that were struggling there in the recession that the cost of college kept going up, and they seem like they were insulated from the recession and the calls kept hurting these families, those students. Okay Senator [xx] you had a question Yes, a comment and then a question? One is that there is policy in this bill because the bill Senator Apodaca recommends or suggests what the result should be. So that's what the concern would be a little bit different, I would be better inclined towards the study were it, a study and the committee was going to bring back the results if found versus explore the options that are the policy options that the senator is recommending and I have a question for Staff Mr. Chair. Go ahead. That is in these statistics we have of how long for it takes to get a degree, four-year, five-year, six-year. Does that include, is that time frame limited to time on test that it the time they are actually enrolled and does it exclude any time they may be out of school for work or for other reasons they have to take time off I'm just concerned as to how those statistics are collected if Staff can answer that sir. Staff, Mark[sp] My [xx] fiscal research it's about the statistics are collected based on the cohorts of the entering class and the last class that we have is from 2006, so if a student entered into that class and took some time off or a semester off or taking a job or just take a break from college, that would be included within that. I think maybe to get to your question, there is a six-year graduation rate but what is the average student take to get out of college? It's around nine semesters or around four and a half years. Follow up. OK follow up Senator Brown. At least in our community with some of the families that I have been involved in, one of the issues we've seen over recent years in addition to the reason it costs more to go to college is because we raise the tuition for what it goes to college and also because the economy more students that often than not go straight through.

They take time off for work, and come back, other thing are family issues come up and there have been more pressures on families. Mr. President. Senator Apodaca. Is this not a study bill? It is a study. No it's a policy bill senate. No it's not madam. Senator Tillman I had your hand sir. OK we have a motion for a favorable report. All those of favor of vote in this amendment let it be known by saying aye, all opposed likes and? The ayes have it. Okay, Senator Hass Okay, does all the members have a copy now? If you don't have a copy let me know please. Senator Robinson, you don't have a copy? Senator Tucker? Okay. Okay Senator Hass, go ahead please Thank you Mr. Chairman, members of the committee, this is a request from the Department of Health and Human Services dealing with the transparency act provisions this moves some of the dates that are not in compliance with at this point it kind of moves them out it gives them some more time to do the reporting and allows the commission a little more flexibility in setting the standards I'd be happy to answer any questions you have Thank Senator Hurst, questions from the committee Mr. Chair, I move favorable report I have a motion for a favorable report. All those in favor [xx] say aye, Aye! All oppose like sign. The motion passed, thank you Senator Hurst. While you're there Senator Hurst, okay, here we go One of the members rather Sergeant of Arms passed this out I have a little announcement, finance will take place 45 minutes after this meeting, finance will convene 45 minutes after this meeting. Will be in 544 for finance OK, members have copies. No? Sergeant-at-Arms thank you I know you're getting your workout today. I know you started early this morning. OK, Senator Hise. Thank you Mr. Chairman, members committee this deals with, there's a provision in the budget to allow the Industrial Commission to develop and implement a drug formulary for workers compensation increases. This is a bill that has been batted around between several committees and others, it's one of those I just feel needs a little work before ready to go, and we need to look at the overall implementations of a drug formulary and what that would mean to the overall cost. Workman's compensation, so this bill asked them to do a study to bring us back that information and removes the policy change that allowed the formulary to go forward. Thank you, Senator Hise. Any question? Senator Blue.  Just one quick question. I think it's a good idea, but would this affect the carriers who would then be writing or underwriting the workers comp insurance? Senator Hise? My understanding is that there's part of the drug cost that this could increase or reduce the cost for overall workmens' compensation claim.

What it's looking at is, this would be something that the policy that's in would be something that would require individuals to try the lower cost drugs prior to moving to higher cost alternatives that's come through the issue is is that when workmen's comp you also have, when you're extending the time period you're also having a weekly payout for every year it expands so that may change the part that's insured back and forth that those implications are why we're going to get this to a study instead of the policy. And I agree with that totally, and what I had failed to realize is that we're self insured in that anyhow, so you're really just affecting the State, not independent insurers. OK, Senator Brock. And that goes back to the point that the largest payer of workers' comp in the State is the State of North Carolina, and what the language that was in the original budget was trying to do was to look at the formulary to make sure that we do go the lowest cost route to save the taxpayer money, and if there's a doctor that wants to go away from the formulary they can, it doesn't stop that from happening, and we're just trying to set up a process to try to save the taxpayer as much money as possible, and the businesses as well, so it's worked in some other states that have looked at it and I think it's just a better way for us to deliver medicine because if you're looking at the cost of it that if we can do it as even effective treatment of lower cost medicine, it saves us. Thank you Senator Brock other questions? Vote against it Senator Tillman, Senator Tillman makes a motion to adopt the amendment, all those in favor of it say Aye, All opposed [xx] motion approved thank you Senator Hass, do you have one more may be two Members all have copies? OK. If you don't have a copy please let, Senator Foushee got a copy, Senator Ford a copy, OK. Everyone have copies now Senator [xx] We'll wait Senator Apodaca, I don't want you to be left out. OK, Senator Hise, you may proceed. Thank you Mr. Chairman, again as we go through this amendment comes from basic policy changes impacting drivers aid and we've taken the cap off the fee and we're looking at families being charged a fee either could be an excessive $300 for the drivers add, and it was passed to that this amendment would remove the requirement for having drivers before you can receive a permit in the state, it would instead change this call for for passage on the drivers license part of the test raise that to 85 and we would add 25 additional hours driving with parents or guardians from 60 to 85, before you can move up in the level of graduating license that one would receive, this does nothing to change the study in the community college or funding in the budget Okay thank you Senator Hice, Senator Brock moves the motion to adopt the amendment in the other discussion if no all those in favor [xx] say aye, all oppose like [xx] the motion is passed, thank you senator Hise, Senator Broth all members have copies Senator Randleman you got a copy? Okay okay, does all the members have [xx] hold on.

Okay. Senator [xx] I believe all the members have copies. Please proceed. Thank you Mr. Chairman. The following amendment is the state agent budget, budgetary transparency and expenditures online, something that was been started by previous administrations and Governor Perdue with open book, this allows for the citizens of North Carolina to look at expenditures in the state, to look at the state of Ohio has a similar program where people can go and look at the expenditures online, as North Carolina as large as we're a corporation will be one of the largest corporation in the world I think we own not only to the you can say we the Board of Directors the general assembly but the share holder which their decisions go to North Carolina to show where their money is being spent. Most of those companies have their information in real time data, real time this is not, up to today this is the week, this is just an update reporting, so I urge your support of the amendment. Senator Forbes. We have the motion. The motion is to adopt the amendment. Any further discussion if not all those in favor let me know by saying aye, all oppose Laikson[sp?], motion passed, Senator Tracker. Thank you, Senator Bork[sp?] Let's make sure members have copies Senator [xx] Okay. Senator Crobly all the members have copies now. You may proceed. Alright thank you Sir. Ladies and gentlemen of the committee, Miss Chairman this amendment simply allows for the $300, 000 for the Carolina Pregnancy Care Fellowship, we have been funding that over past budgets, and some reason or another we had admitted that this is block grand funds that'll be transferred in a stipulation no more than 15% of the money can be spent on administration the rest must go to counselling. Have about 20 centers located across the state ask for your support on the amendment, be glad to answer any questions Okay, any questions from the committee? Senator Ford   Thank you sir   Move for favorable   The motion is to adopt the amendment any further discussion? Seeing none all in favor [xx] saying aye, Aye!  All oppose [xx] motion pass thank you Senator Tucker, Senator Wade this just how I don't even think they need it it's just a minor correction changing of date for the report from the Marine Fisheries Commission from April, to the May 1st, 2016 so we would be in session when they give the report to the act chairs of the house and the senate Does all the members have copies? Move for adoption Senator Tucker has his hand is up, would you want a [xx] now Senator Tucker, do you have a question? No sir but I will defer to Senator Apodaca Okay Senator Apodaca the motion is to adopt the amendment any further discussion? Seeing none all those in favor let it be known by saying Aye all oppose like same[sp], motion passes thank you Sen Wade. Senator Apodaca please step forward I need that back let's make sure everybody got copies, all members got copies, okay, hold on just one second please. I think all members have

copies Senator Apodaca you may preceed Thank you, Mr. Chairman. All this does is names the Boys & Girls Club as the designee for a specific amount of grant funds. It removed a former organization that was there and put the Boys & Girls Club there instead. OK, discussion? Any discussion? Senator Wade? Senator Wade moves that the motion is to adopt the amendment, any further discussion? Seeing none, all of those in favor of the motion let it be known by saying Aye. Aye. All opposed like sign. The motion is passed, thank you. Senator Apodaca. Senator Foushee. Thanks. Can I have my property back? All members have copies I believe all members have copies, senator Foushee you may proceed. Thank you, Mr Chairman. This simple amendment is regarding to funding for our children's plays it doesn't require additional money, it simply allows for the conversion of funds that were allocated for planning and design to be used for operations and would provide for a continuous services for children of incarcerated parents. Mr. Chairman, Senator Brock Just a clerical inquiry that supposed to be 2004 or 2014? Senator [xx] I think these funds were first appropriated in 2007. I think I can answer that, I think they were originally appropriated during 2004, 2005 year because of the wording we're not been able to use the remainder of the menu and I think that's what this amendment is doing. Any other questions? Senator Brown makes the motion the motion is to adopt the amendment any further discussion? Seeing none all those in favor vote enormous saying aye, Aye! All oppose lock sign the motion passed and now turn to Chair the senator Harington at this moment so I agree an amendment. Senator Jackson is recognized to run this amendment. Members have copie Okay. Parker. Think I motioned it. Please? This basically moves to amend the bill on page 99 the lines 5 through 6 by inserting between those lines the following new section which is used to rare connect program and if you've section line 12 of this amendment, section number 10 of four and 11B would be for the South [xx] Community Collage shall earn budget FT for student force enrollment provided in this act, the section of 10, 11C this section is effective when this act becomes law and expires June 30th 2018 and line 17 it moves to amend the senate committee on the corporation's budget report on the basic expansion and capital budget house bill 97 dated June 16th 2015 as follows online 20 on page AS6 line 30 by decreasing the amount of fiscal year 2015/16 by 140, 000 and then on line 22 from page F6 by adding a new item after that. Item 33 to read youth career connect program, and it is appropriating $140000 of non recurring many, this many will be used to offset or to gather $2.2 or $2.4 million federal money, they can be used for this program and I would ask for your support and I'll be glad to have staff explain this if you need further explanations. Thank you Senator Jackson, questions from committee?

Senator Hise Thank you Miss Chairman this just may simple be a staff question I'm asking for but when the funds earned by FTE are budgeted in this year, would that not make that the enrollment had to occur in the previous year for the budgeted funds to be paid out this year under FDE for those requirements so that's why trying say we're funding a program going forward as it already existing so that we have that FTE earned that we get ready to pay out. And I'm sure, that's an excellent question Senator Hass and I'll refer to Barrett to try and explain and expound upon that answer. Staff. Yes sir, thank you Mr. Chair with fiscal research, Senator Hass you're correct that community college, FTE is funded in the years based on enrollment and priority year average prior two years and the case of a newly established program such as the this it's possible to provide some startup funds so this will be initiated in the four but it would actually earn the FTE into the following fiscal year what this will do is provide the funds with upfront for the first year of the program. Follow up as it is now this is not vefty this is just 140, 000 start up funds to make sure they can receive them this year. Yes sir that's correct and then this will be rolled into future and Roman adjustments. Thank you senator Turker question maybe for staff to senator Jackson is this program was presented initially to me by the president of South Pittmon in superintendent Union county public school so is this just Anson county students that can enroll in this or is it [xx]   but South pittmon is in both places? Mr. Chairman I'm not sure about that. This was presented to me to run for member not a member of this committee so I would refer to staff on that question Senator Apodaca, staff Yes, Fred Hopman with fiscal research again this would only serve [xx] county school students Further questions from committee? Senator Apodaca Madam Chair thank you, Senator Brian now we're both wondering do we offer this at any other community colleges I think I can answer that if you like Madam Chair I think we'd need to let staff answer that Madam Chair Alright, staff Fred Hopman with physical research again so currently the only way that freshmen and soft more high school students can be counted in community college budget FTE is if their participating and approved cooperative innovative high school program so this would be sort of an exception to that current policy Follow up Follow up Senator Apodoca Yes mam and I don't know whom I'm going to follow this up to. Has been looked at by any policy committees? Can anybody tell me any educational policy committee Senator Jackson do you know? I do not know Staff? This was in the house budget, I'm not aware of any other committees that have considered it Senator Tucker did you have another comment Yes Madam Chair, Senator Apodaca this was based on our bill, Senator Curtis you remember my bill that required the repayment of $24 million to the community colleges so [xx] for the first two years of high school seniors. I mean first two years of highschool graduates, you might want to run the bill and so what happened was I guess the best explanation I can give you is this is a power really it doesn't say but no sir it hasn't been through policy that I am aware of and it's a pilot program for Anson County and South [xx] to see if this program works and then if it does we'll take it statewide. Senator Apodaca follow up. Madam Chairman, did you say this is in the house budget? I did not say that I will refer back to Staff. Fred[sp?] Ortman[sp?] Fiscal Research. Yes Senator Apodaca this was in the house budget. Follow up Senator Apodaca. Madam Chairman I think we might be best not do this and we'll discuss it in conference it will be in contention. Sounds fine. I withdraw the motion Madam Chairman. Thank you OK that was short Senator Davis, Jim Davis All members

have copies, Senator Davis you may proceed. Thank you Mr. Chairman. Members, this is just a defining language brought forth by the treasurer's office in order to better manage the Able Act, and if you want any specifics I'll have to refer to staff because there are a lot of technical items in this amendment. Mr. Chairman, a favorable report. Senator Brown the motion is to adopt the amendment, any discussion? Seeing none, all those in favor let it be known by saying Aye. Aye! All opposed like sign motion passed, thank you Senator Davis. Members that's it for the amendments, I'd be glad to discuss the bill as amended. Senator Brown. I have a question about [xx] I can't. Ask your neighbor to help you. Thank you Senator Brock who's holding the mic for me so this is got to be good. OK, there was a provision and I think it's a special provision involving the State Health Plan, is that appropriate for this meeting? Yes Ma'am I would think so, its in this bill, where there is the payments, there's a change in the annual payment, employer payment that we make and then a change, an increase in the reserve they have to hold, my question of staff is how much will these two changes in the employer contribution and in the reserve require, how will that increase our premiums for health insurance for employees and retirees? Thank you Senator Brown for the question. I know we'll require the whole 600 million in reserve. Senator [xx] would you like to. Yes Sir, Mr Chairman. This will also be dealt with and I think some of these changes were asked for by the treasures office as we go forward with the health plan and the treasurer's office so make those actual decisions going forward with the benefits and premium council. OK follow up? Follow up. These were two particular changes that will I think drive up the premiums and I just want to be clear about that, if staff can direct me to the provision on the reserve I can find the other provision and I can. Staff. What's the provision on the reserve 2014. Can staff tell me what the provision. Yeah go ahead, maybe. Yes, David bend wider in fiscal research. The provision setting the contribution rate first is, let me start with cash reserve that is section 30.31 on page 140 of the PCS. The contribution rates are said in section 30.20 on page 437 The contribution rates in this PCS are said to be the same as they are in the year phys cal year 1415. There's no increase in the employer contribution or premium rate. My understanding is, don't we normally increase that employer contribution rate to meet whatever is the new healthcare calls increases, and also with now requiring a reserve which is chilling out a bad idea, but the combination of those two things can we get staff to indicate what impact would that have on premium, employer premium? How would you answer that?  I would touch on it brief if I could Sure Senator Brant[sp?], there's over a billion dollars in reserves now. The revision that sets the $600, 000, 000 reserves amount, we just felt like that was

just good policy moving forward, to have that reserve, but there is over a billion dollars in reserves now so we feel like the treasure has some flexibility to with that additional reserve to make it work. Okay follow up. Follow up. So I just need a straight up answer are we putting them in a position to have to increase premiums and is that your intentions or what? Would that be a satisfactory result for you if that were the case? Senator Brown. I would just say the treasure is in charge of managing the program, again there's over a billion in reserves we've got, we put in a provision recession must keep 600, 000, 000 in reserve so she has I'm going to guess 500 million or so flexibility to work with and managing the plan, other than that I don't know what you want me to say. If I may add, it's not our intent that we have to raise, but we thought the treasure's been handling this and she could make those decisions as moving forward with us should be sufficient money there to give her some flexibility to look at this really closely and see what needs to be done moving forward. Okay, just one more question, is there any reason we didn't honor at least a part of the request to increase the annual payment this year, the employer payment based on increased calls, health care calls, any particular reason we refused to do that. I will answer that, there was no particular reason that we didn't do that we felt with over a billion dollars, they had that playing room there with $400 million plus, that would give her sometime to look at this program and see what needs to be done. Other questions concerning the whole budget? No question? I would like this motion please. Yes sir senator [xx] is recognized for a motion. Mr. Chairman I'd like to move for an unfavorable report to the original bill favorable to the proposed committee substitute as amended and move it forward an engrossed. OK and [xx] if I may add it was [xx] referral to finance and pension retirement and [xx] and with Lee for Staff to make technical corrections and component changes. Exactly. That's what I thought you said. Any other discussion we have a motion before us all those in favor let it be known by saying Aye, Aye. All oppose like same. The motion is carried the motion is passed ladies and gentlemen we stand adjourned finance will meet 45 minutes, we say 150 in room 544 thank you all.