Arkansas Legislative Council (ALC)

President Garner you can go one grow up if you want extra represent Whitaker. Six six six. And represent McCullough. Seat number five. We. Yes. All right members is there anyone wishing to move at this point a few minutes. Represent Garner is fifteen. What. Representative of my call is sixteen. C.. Yes. Seat number forty seven is represent Womack. Seat number forty five his representative Charlene Fite. Okay members will go ahead and get started. So. We're going to get started with the approval of the last month's meeting minutes I have a motion. So moved I have a second. Got a second all those in favor the minutes say aye. All opposed minutes adopted so with that we'll move into D.. With the are revenue report for miss Ellie Stennett. So members there's going to be add on in the Revenue section we're gonna go ahead and get the forecast. Right after we get the revenue report. You would introduce yourself for the record you're recognized or thank you Mr chairman at least and it on the Legislative economists FOR BLR. I'm here to present the April twenty twenty one Arkansas revenue report. We are ten months into the twenty twenty one fiscal year. Cumulative gross general revenues are up six hundred and forty nine point three million or eleven point two percent from the same period last year net general revenue was up eleven point one percent from this period last year. If you turn the page to the graph. You can see that net general revenues available for distribution R. seven hundred and sixteen point eight million above the forecast. You turn the page again. Gross receipts taxes on a committed basis are up eleven point two percent from this period last year and total income taxes are up eleven point six percent with that I'll take any questions. Members who have any questions on revenue report. Okay. Sir just fill out thanks so much I just want to say thank you for your report and welcome thank you is is the first time I've seen a woman in that position it's a delight to see it thank you very much. President Ladyman you're recognized. Thank you Mr up I have a question on the Page one there of the. We're talking about economic development incentive fund. And it shows that at a negative I'm reading that right. A negative thirty eight percent. Why is that so negative most these numbers are positive why is it. Yes. I mean is that due to economic activity or what. I'm gonna have to research that for you and get you that the answer that's okay okay thank you. Seeing no further questions. Will have doctor shall not come to the table and give the revenue forecast. One more time. Thank you. You're recognized. Yes you you have in your packet the the letter forecast letter from us secretary Walter as well as attachments describing the biennial forecast revision. at the back of the hand you have tables. Summarizing the revenue categories With the net available and surplus numbers indicated at the bottom of the table. The very last page of your hand up. On the back has economic assumptions. In a the bottom of that table on the last page. I'll be glad to take questions any questions from the members. Seeing no questions thank you for the report. So with that we'll go to of co chair senator rice for the executive subcommittee report. I wish chair of members the ALC executive subcommittee met multiple times during a legislative session among other things reviewed and approved various emergency rules and conducted to a procurement process to hire consultants to study the State and Public School Life and Health Insurance program copies of the merger rules and report to the executive subcommittees meeting and action were sent to all A. L. C. members and all alternates before and after each emergency rule was considered in accordance with rule twenty two of ALC rules. At its meeting on may twelfth executive subcommittee voted to approve the July A. L. C. meeting to July twenty third we moved that with all subcommittee meetings to be held July nineteenth through twenty second to comment a two conference schedule in addition to the subcommittee voted to recommend changes to the A. L. C. rules two four A. L. C. and those were proposed changes were sent out to all AOC members and all alternates on may thirteenth Joe fire with the bureau of legislative research will present the proposed changes in answer any questions and of the these rules that pertain to particular subcommittees were also presented to those subcommittees Mr you're recognized. So hold on one second so committee we have to vote on the rules by house and Senate so what I want to do is I want to adopt his report without the rules so I can take a vote of the membership as a whole and then we'll go into the rules so do I have that motion have a motion by Senator English second by Senator Pitsch all those in favor say aye. All opposed ayes have it so let me explain this vote before we go into the explanation the house will vote by voice vote and then we'll go to the Senate to vote by voice vote unless otherwise called for by a member is everybody I understand the rules vote. So Mister zero if you would you're recognized. Thank you Mr chair Jill they're pure of Legislative Research I should all have in your packet behind the executive subcommittee report a copy of the proposed legislative council rules the changes to the rules are in red there's a lot of red and so I'm just going to quickly go over where those are and briefly tell you what they are and then answer any questions you have. So the first change that you have is on page one and this one is at the request of the Legislative Council chairs and it just involves at the agenda deadline for Legislative Council. If you turn to page three the next change is to the peer subcommittee duties this sets in place voting requirements that were implemented back ten fifty eight this session regarding restricted reserve fund set aside. I'm page four. You'll see at the very top of the page ACT nine ninety seven and added the American rescue plan act approvals to the peer subcommittee. And I'm sorry right before that at four forty six also and dealt with an anticipated federal funds and those will be assigned to the pure subcommittee. Under the administrative role subcommittee on page four and this just adds under act sixty four of the technical corrections decisions that will be appealed to the rules subcommittee. And also adds at their in subdivision D. and the role subcommittee will look at the sunset of all rules dealing with milk and cattle production by the end of next year. On page five. The personnel subcommittee has been assigned all at approval of the decisions by the state board of finance related to the state and public school employee health programs. And then right below that they've also been assigned as study that was created back seven ninety six regarding at state agency positions that's a study that though conduct over the next biennium. At the bottom of the page five you'll see that at the request of the Legislative Council chairs the claims review subcommittee and the litigation reports oversight subcommittee have been combined they had similar subject matters and both meets very infrequently this allowed the Legislative Council to maintain the same number of subcommittee states had. I'm page six at the lottery oversight subcommittee ACT six thirty six requires Legislative Council to approve loans from the scholarship shortfall Reserve trust fund account for letters lottery scholarships that was assigned to the subcommittee. And then on pages six and seven the highway subcommittee as your call last at by any and they completed a study on the highway departments and at the end of last year you all as assigned to them review of rules and contracts related to that study. This clarifies that and also adds language from ACT seven thirty nine to require public comment. I am at the bottom of the page seven we just remove the language regarding this study by the highway subcommittee because it was completed last year an expired. Then pages eight and nine there is the new medical marijuana advisory sub committee which was established by ACT six thirty two of this session. And add that subcommittee will have oversight of all at rules contracts and and other matters related to medical marijuana marijuana. So your next changes are on pages or is on page twelve. This is real seven and I would draw your attention also to the very back of the rules there's some additional language that was added to that sense this was emailed out to you at the request of. President pro tem Hickey and Speaker Shepherd in the council chairs this is regarding notice that will be given for calling special meetings of the Legislative Council this new language will require at least one business days notice for any that meetings that are regarding American rescue plan act approvals because sometimes those can't wait until your next regularly scheduled meeting and can't take six days notice and also any meetings related to your new rule twenty five that I'll go over in a minute and which has to do with emergency declarations an emergency powers of the executive branch so for those two you would receive six days notice. Then exchange. Is on page twenty. There's identical language added at page twenty and twenty one ACT eleven oh one and states that a rule that contains a fee or a penalty normally when you're deciding not to approve a rule you have to state grounds that it either doesn't comply with federal or state law or legislative intent if the rule contains a fee or penalty you don't have to state aground and that's in accordance with Act eleven oh one. Okay so beginning on page twenty two and the next several pages are all new language and I'll just go over these very briefly and answer any questions you may have and. ACT four forty six. Stated that I'm an anticipated federal funds that come in related to a public health emergency in the state require at prior approval of the Legislative Council so that's what this as subsection a deals with. Under B. were at this is for a request for renewal as an emergency declaration this is what you all did in March when you met and when the governor at last a renewal of the emergency. And that sets out that procedure subsection C. is for executive orders and proclamations issued in connection with the emergency declaration you also dealt with that in March. And this one sets out an original issuance of those orders renewals of the orders and then any new ones that may be issued after the renewal so there are three processes there for the original issuance it's just review for the other two you have the power to terminate this. Page twenty four and subsection details with directives of the state board of health related to emergency declarations and sets for the procedures for the initial issuance which would be handled by the executive subcommittee and then renewals which would be handled by this body. And then and the next provision is For COVID nineteen vaccine mandates this was ACT nine seventy seven there are two portions to this choir Legislative Council involvement the first is a mandate for at State under state control medical facility. And then the next portion is for an mandate for vaccination of children you'll notice in both of these that they are only in place for two years from the date of approval of the vaccine by the FDA currently we're under emergency use authorization so the bureau will track when that date begins it'll probably go through here your current biennium and then the last new rules rule twenty six on page twenty five and this is the procedure for review of presidential executive orders under Act six oh eight. So with that I'll take any questions. So we do have a few questions Senator Teague you're recognized. Good morning Mr chairman thank you. Retirement I think you and the chairman rice know that I have objections to the executive committee actions in most cases where I feel that. it's not urgent and that the people are trying to circumvent coming in front of us generosa Love had discussions there were times. Does a. Anything in these rules affect that. There's something about executive committee and we just. Where we add echo ten eleven. Well no that's a different question so does anything affect the executor metes power in this the real changes. Are you are you asking if it gives them any additional power or or loses you need or what is there any changes that affect exactly committees power the only change is under the emergency declarations the Adam. Regarding directives of the state board of health ACT four oh three as signed review of the initial issuance of those directives to the executive subcommittee so that was five by that act other than that the powers of the executive subcommittee remain the same as they have. So in. page three. they're in the red riding. we're act can be eight is included into the. Health. The way I read just exactly Committee doesn't get to make these decisions have to be the committee. Correct these will go through the peer subcommittee and then come to this body okay good one more question Mr chairman place you're recognized. Except I may have lost it but I had a heck of a questions or. We got a few I come back to you if you think about it no I got it I got it so. The gentleman Page twenty now Any tax eleven oh one if a rule contained the fear facility promulgated. The. Basically says that we can choose to ignore it or not to approve it is that legal I thought that was one of the issues that we always have about. our story versus the governor's authority. The legislature is given the authority to review and approve rules and you've set out under what grounds you can do that and this just states that for these particular rules you don't have to state grounds. And so that day name impinge on anybody else Dunstable that. That's already at all okay. You Mr chairman I appreciate it thank you. Presented Lowery you're recognized for a question. Thank you Mr miss their on page twelve Number seven the Legislative Council meetings the power that's given to the cochairs to call in a meeting of the Legislative Council with less than sixty days if you in your presentation it seems like I heard that you said no less than one day is that is that the way that this is being interpreted. For a regular meeting and and in any meeting that is not related to rule twenty five The New rule twenty five or an approval as an American rescue plan act expenditures it requires sixty days notice I am for those two items that will require at least one business day notice under this new provision of rule seven okay why is it worded in such a way that it doesn't say that clearly I mean I I think that that would of if it it said. No no less than one day I think that there would have been a lot a lot more push back early on that that just seems like a very short time frame to call a full meeting of the Legislative Council is there anyone that can cochairs respond to that. Can you repeat that I was reading something else calling a full meeting of the Legislative Council with only one day notice seems extreme so when you look at the restrictions on some of these funds and the amount of time that has to expire between the requested when the fund has to be transferred if you put that six day notice in there it knocks us out of the no to get those funds approved within that time frame so we met this morning with some agencies on that and there's some fear out there that we can't get together quick enough to get that money out so that's the reason that was moved back to one to one day well and thank you and I and I understand the six days it is too much to be able to respond to some of these but one day is too short a time frame especially if we're going to expect to have a quorum. To deal with the other option was what we've done in the past and we still have the actual power to do in the existing rules and that's the chair's appear and chairs of council just sign those request and then a report back to the committee at the next regular meeting there's been membership that is expressed they wanted full member full meeting so in order to do that we had to really reduce that time down to one day so it was more in a request for membership is and then it was the ability to accommodate because we had the authority to accommodate but it wasn't accommodating with the full membership okay well I'm just voicing that I think say two days would still give adequate ability to respond but it also would would sure more participation by legislative counsel especially if if these meetings happen to be called during the summer months but we'll see if anybody wants to make a motion on that but I I would like to see substances at least two days. Senator Elliot you're recognized. Thank you Mr chair my questions on page twenty four and I'm trying to reconcile number while under initial issuance of directives number one so I want to be clear that this so the executive powers of the executive committee has the sole authority in. Okay in a directive is that is that correct under one a for its just issuance issuance of directives. Yes senator Elliots okay. So I said that and and. If if the subcommittee is in if the executive subcommittee okay something okay is a directive may have that so look forty then we come down to request for renewable. If that directive that's been okayed by the subcommittee is to be extended then it comes to Legislative Council does that flow correctly yes ma'am okay that's what worked and. And is it in legislation that the executive subcommittee shall have that so look toward the two okay the directive in the first place is that what this rule is this one yes ma'am this is directly from that okay all right thank you very much that's in the city or. Thank you. Seeing no further. Do I have a motion for approval in the house I have a motion I have a second all those in favor on the house side say aye. All those opposed ayes have it rules adopted on house I go to the Senate to have a motion for approval got it got a second Senator English was motion Senator Pitsch was second all those in favor say aye. All opposed Is haven't rules are adopted so with that a committee we're going to step to the supplemental agenda so I need a motion to spend rule so moved by Speaker Shepherd a second by representative Vaught all those in favor say aye. Oppose ayes have it rules are suspended so if that will move on to the governor's letter it's in your packet and I'll need a motion to approve the governor's letter. I have a motion represented these I have a second. Supplemental agenda it's a governor's letter on representative tall AT NO for employment for stuff dogs cool District. Settle motion I have a second. Any questions Senator Hickey any discussion. All those in favor say aye. All opposed Is have it. So with that we'll move on to our standing committee reports administrative rules Representive these. You're recognized thank you Mr chairman Mr rule subcommittee first met on Thursday may six upon referral from the executive subcommittee to consider and make recommendations to the executive subcommittee concerning the emergency promulgation of the State Plant Board rule concerning I camera subcommittee heard testimony from the agency and members of the public and made no recommendations the subcommittee also met on Wednesday may nineteenth at that meeting the subcommittee adopted its subcommittee rules the subcommittee adopted reports of the executive subcommittee concerning its approval or emergency rules subcommittee reviewed and filed the quarterly reports that were submitted by the department of corrections and parole board to rules by the state board of finance were pulled from the agenda by the agency all of the rules were reviewed and approved the subcommittee also received an agency update on delinquent rulemaking under ACT five seventeen of two thousand nineteen and that without I move adoption of report. That's proper motion any discussion on the motion. C. N. ninety five seconds the second representative Ladyman all those in favor say aye. All opposed us have it with that we'll go to the peer report representative gray. Thank you Mr chairman the peer subcommittee met on Tuesday may eighteenth the subcommittee adopted rules for the biennium and approved a request for American rescue plan appropriation the subcommittee reviewed requests for cash fund appropriation miscellaneous federal grants appropriation budget classification transfers and pay plan appropriation the subcommittee also received reports I move adoption of the report. That is also properly motion the discussion on the motion. Sinan drive second second representative Ladyman all those in favor say aye. Oppose ayes have it imports dropped in with that I'll go to center Chesterfield. For the policy report. Thank you rescuers. Thank you Mr chair the policy making subcommittee met on Wednesday May nineteen and heard from senator Kim Hammer and representative Les Warren requesting approval of the actuarial consulting services contract between Osborn Carreiro and associates and the bureau of legislative research for the benefit of the joint retirement committee subcommittee recommended approval of the contract. Secondly them the subcommittee also heard a presentation from senator Terry Rice and representative Jeff Wardlaw requesting approval of the employee health benefits consulting services contract between the Siegel group incorporated in the bureau for the benefit of the executive subcommittee subcommittee voted to recommend approval of this contract. The subcommittee also review the standing committee fund allocations for mileage and per diem for fiscal year twenty twenty to the subcommittee recommended approval of the committee fund allocations that are set forth in the attachment to this report these balances will be effective July one twenty twenty one for further questions about the actuarial services contract by the employee health benefits consulting services contract I would ask the committee to direct those questions to the cheers of those respective committees who presented with that Mister chair I move adoption of the report. As proper motion a discussion. See non drive second. I have a second representative Ladyman all those in favor for the adoption of port say aye. All opposed as habit with that we'll move on to the review subcommittee Rep Kent representative Bragg thank you Mr review subcommittee met on Tuesday and reviewed methods of finance grants service contracts and MOF for Arkansas state police troop B. headquarters for five million three hundred forty three thousand sixty nine dollars ninety nine cents was held for additional questions for many questions for the agency I'll have a motion at the proper time. Thank you as proper motion with that can we get state police come forward. If you guys would go ahead introduce yourself a record and we'll get started with questions. I you Mr chairman bill Bryant director the Arkansas state police. John Smith CFO per department of public safety Mike Moyer captain with Arkansas state police so in the subcommittee I ask the question. Why the two and a half million dollars above the forecast or both of the the initial contract you guys weren't present to answer that question can you answer that question today yes Sir Mr chairman first all of our apologies it was a simple oversight we were there for the morning meeting not the afternoon we did make the meeting before adjourned but I will be glad to answer your question if you remember back in twenty seventeen we refinanced our skews me we got a bond bill five new headquarters including true baby under troop B. headquarters of the the major expense from the initial cost the others we implemented a CDL Pat there right across the street from Newport. it originally wasn't a issue Newport we moved it to where we can be all in one area for better customer service that was a main increase in the cost from the original calls up to five point three million. Thank you are there any other questions or committee. Seeing none thank you to have a second on the motion I have a second the motion is to include the adoption of the method of finance for state police all those in favor say aye. All opposed us have it thank you guys forty nine thank you Mr is adopted so with that we'll go to the highway subcommittee representative McNair. Thank you Mr chair of the highway commission review an advisory subcommittee met on Tuesday may eighteenth the subcommittee discussed the op forty bridge over the Mississippi River was representative of the department. Per a request by the subcommittee the the department is available to provide a LC an update on inspection efforts on our fifty five bridge that also crosses the Mississippi River at the proper time I move adoption of the report. Are there any questions from the committee from the for the department. Okay so with that I'll go ahead and have Director tutor and her staff to the table. Senator Johnson you'll be the first in the queue and they recognize or so for the record. You would introduce yourself a reggae Laurie teeter Arkansas department of transportation director centre Johnson you're recognized thank you Mr chairman of director to thank you for being here and I appreciate it your very candid and helpful comments at the subcommittee meeting this week and that you were asked to to come to a LC today if there was some new development that you could share with everyone and be able to take questions from from all of us students to subcommittee and I'm I'm really just gonna leave it at that and say Izard a development since our last visit that because a lot of our constituents are waiting to hear this is a very important news to people all over the state not just in Eastern Arkansas can you update us on the last few days yes yes Sir I can and. Yesterday I travel to Memphis to meet with my counterpart in federal highway acting administrator in some other industry stakeholders and we talked about the I. fifty five bridge which is under inspection right now by Tennessee DOT and they have been actively in inspecting that bridge and they have not found anything of concern to this point and I checked in again this morning with T. dot still nothing they found we should have the final report sometime next week but they have not be usually seen anything of concern so the I. fifty five bridge at this point time is is safe and everything's going well on an inspection. Thank you that's about all I have new to at to report to the committee. Since Tuesday. Senator Garner you're recognized for a question thank you chairman so there is a picture circulating on social media that the kayaker underneath the bridge may have seen the crack as far back as two thousand sixteen also anything on social media is taking with a. A bit of specters are a bit a bit suspicion but have you I know we discussed the other day you only have a drone footage from two thousand nineteen Nestle for back you say it have you seen that photo do you think there's any confirmation the death photos verified Trudy to crack existed back in two thousand sixteen and if so was the same employ the one responsible for the inspection back then we cannot verify that photo is an authentic or not we don't have pictures back from twenty sixteen so really can't comment on that whether it's with that photo is we can't verify the photo Okay so thank you second question thank you Mr chairman of. We discussed then about doing a review of all the bridges that these derelict employee had inspected and I've read a little bit more has been maybe some identification of who it is what's the status of that as a read more inspections or do we have a culture timeline when they'll be done yes we started that this week we are reviewing all the inspection that the truck inspections that terminate an employee conducted over the last year there under way right now I am we will report to the committee once we get the findings if there's anything that we find will report okay thank you. Representative makes you're recognized for a question thank you Mr out question and a follow up that's okay my first question is my understanding is that Arkansas and Tennessee or supposed to share joint responsibility for this bridge can you talk to us about where our responsibility is verses where their responsibility is for the inspection and maintenance of the I. forty nine fifty five bridges I I know you said that Tennessee's doing I fifty five bridge but is that something where we do the forty bridge and they do the fifty five rates we have joint will so what what what's the the different responsibilities on those two bridges well the agreement that we've been under with T. dot for since way back for the I. forty bridge and for the I. fifty five bridge is that are not responsible for the inspections in T. dot is responsible for any maintenance contract work anything that a construction contract T. dots responsible for so they're taking the lead on the construction repairs they've already got a contractor on board for the I. forty bridge because of this failure in our inspection process that came to light and. You know the we asked T. dot please do a inspection of the I. fifty five bridge just to try to restore some public confidence because of of what's in unfolded over the last week so they are doing that for for us and normally we would be doing it but in this case we've asked for them to do a special inspection for us okay follow up. and and kind of lean back to what senator garner had said that you know we've seen pictures going back to twenty nineteen and potentially twenty sixteen on this do you all with these inspections are going on do you take photographs of these structures and then have a an archive if you will of these photographs so that. If and when an issue like this arises that you have the ability to go back and do research to say Hey you know last year we inspected and photographed this was or wasn't here and so far do you do you have anything like that in place is that something if not that we might should. Absolutely in the past they only took pictures if they solve problems so that was documented in the file. In twenty nineteen are consultant Michael Baker began doing these drone reviews with using drone footage we have actually bought a drone for our own use we're going to start doing that as a redundancy for these bridges is to do your drone Review in addition to the hands on inspection so we will have that in the file that prior to twenty nineteen we did not have that okay so this is something as I was like your you are going to do going for those trying to keep photographic evidence at absolutely awesome thank you thank you Mr. Thank you. So with that. Representative Ferguson you're recognized thank you Mr chair I'm over here I'm the representative from West Memphis. Of even before we had this problem had to shut down I forty we had been sort of dealing with T. dot about closing down I. fifty five to read to the exit ramp on the Tennessee side in of course you know this you say the problem if you've been there a few you know how difficult it is to get back and forth with all the trucks and if there's a wreck I mean it's just you're in a parking lot for hours. So is that I thought the plan for T. dot was to shut down I. fifty five to one line for three years starting in January I can imagine how devastating that will be for us after we've just recovered from fixing the I. forty bridge is that still the T. dot plan to close down I. fifty five to one line for three years in January. No I'm. Army no ma'am our diet was involved with in the environmental impact and what all is going to go on if that actually occurred and we have we have steadily resisted that because of just the worries about what it would mean to West Memphis citizens and and everyone effect if that bridge was shut down to one lane. And with what has come to light now I'm very very thankful that that never happened so that's not debts that still under review and they're looking at what they can do and they're trying to figure out the economic impact but with this with this what just happened with I. forty bridge I think that will definitely be delayed in in deferred for a a long time we'll mascot other questions Jeff is it okay if I ask a follow up of yes the a the other thing I know when we looked at all of the the bridge grading when I thought a part of when they shut down to do the exit ramps I'm gonna do some repairs to fifty five can you tell explain to me a little bit about the grading of bridges I thought I fifty five was already like a grade the bridge can you explain to me what the grading maintenance and what that means in terms of infrastructure grading and the quality of the I. fifty five bridge that we're now diverting all that heavy truck traffic to. Can I invite my and art are not state the director and chief engineer appears he's unable to add I'm not sure about the grading I know we rate the bridges right according to their structural integrity and those types of things but maybe he knows more about what you're and ask right yeah nine I know you just an inspection but a but I am concerned that we for ten years worried about the integrity of five fifty five I really was surprised at I. forty was the bridge to go first well it can I do you cannot do can I say that we have an inspection under way right now T. dot is doing an inspection we have been inspecting it and we haven't found any any structural problems with the bridge but to instill public confidence we've asked you got to come behind us and do another inspection immediately it's on going so any concerns that you have now or this constituents have or anyone driving over that bridge you know will be relieved. It does that help at all I mean maybe explain to me a little bit wine has such a low rating at rates well it's in nineteen forty seven structures the age of the bridge but all that all that rex expound on that a little. If you would introduce yourself for the record and you're recognized and. Yes Sir thank you Mr a wrecker finds that the Director chief engineer Arkansas department transportation there. There is more that goes into the rating I don't know all the details to it goes into rating but one of the major things is the traffic flow the with of the lines with the shoulder to accommodate traffic that's a lot of the reason I fifty five is is low rated as it is because it has a relatively narrow lanes a lot of truck traffic no escape route no real shoulders so that's a part of the reason it is structurally it is old there are problems but nothing that we are concerned about that this traffic would be to so it's more about travel on the bridge then integrity of the bridge that the yes ma'am okay thank you is made. So Senator Ballinger you're recognized. Thank you Mr I'm coming back to this this report of the two thousand sixteen photo it's a it's a journalist in Memphis I'm Joyce Patterson that that where I found it in and she claims that the person took the who took the picture Senate to both the T. dot R. dot and actually got a response from our diet but I don't I don't see any other information outside of that do you do you I mean are you familiar with the picture first. I'm familiar with the picture okay and we took it and we try to verify if it was correct if it was you can get real close that microphone please any can you hear me now. We took the picture and we were we try to see if we could authenticated or not with with our files with any photos in our files we cannot. so we can't really comment on whether it's a. Sure so this in and from the the posting I can't tell if if they're claiming they send it to you back in two thousand sixteen or their day sent to you after this issue of a bill do you know. I am not aware of it being sent to okay all this came to light and from what I've read he went back to his photos when he when he heard all this going on he went back in he he remembered kayaking underneath the bridge and taking photos so he went back and reviewed his own photos so that's okay that makes sense that that helps me at least we didn't know about it yes okay. Representative Cavenaugh you're recognized. Thank you Mr chair I'm over here to your right over here. The employee that we're talking about that was actually the team leader on the I. forty bridge that was terminated because of the failure to actually notify anyone about the crack. he was a team leader correct he was also an inspector my understanding from your testimony if the subcommittee was just an employee that was inspecting the affective five bridge yes he was he was both who is involved with the inspection and he was the team leader okay then also as a team leader he's responsible for teaching other employees I miss them and how to inspect bridges and I know that you're going back in you're looking at the bridges that he inspected but what about the employees that he taught how to inspect when he did himself no how to inspect properly what are you gonna do just to give the citizens of Arkansas some type of reassurance that there's going to be a way to check these bridges to make sure they're safe and then the follow up to that is and how much is this going to cost the state. Okay I'll answer your first question we are doing everything we need to do at this point to make sure that those fears are relieved we're going to make sure those employees understand the correct way to inspect bridges we have asked federal highway to committee review our processes this is being turned over to the US DOT office of inspector general to do a thorough investigation we have put into place everything we know to do at this point time to make sure everything is employee has done is is address not only from training employees but also from inspecting bridges we cannot go any further than where we're at right now we're going to hire a consultant to come in and and help us with quality assurance quality control all these things are being put into place and it will cost the state something because we're going to really beef up our inspection program but I can't tell you right now today what it's going to cost but I'll tell you this at this point time we are doing everything possible and we need to change our focus from this failure in our process in this employee and start talking about how to get how to get traffic moving across that bridge working with our tractors working with our road users working with West Memphis I've got we all need to start focusing on I. forty because that's what's important right now getting a bridge repaired getting it back open to traffic making sure traffic is flowing right now and in minimizing the pain as much as possible and then once we get it fixed figure out what the failure what is what costs that feel you are not did not cause the failure we fail to to identify the failure but we didn't cause it we've got to figure out what caused the failure so that we can see what the weak spots are and address those on the bridge as well if so they won't propagate they will. Come to you know they won't start we'll look at that thoroughly but right now I need everyone to focus on what's really important put that fifty inspector behind us we will continue to work on that we've got everything in motion to take care of our program to make sure we get it the way it should be but everyone needs to give the public and everyone that drives over that bridge the confidence that we're moving forward and take care of that bridge for you don is is in the lead in the whole thing and they're doing an excellent job follow up Mr with all due respect I agree that we need to get the traffic moving because it is a vital every place for us to be able to do commerce. But the citizens of Arkansas have a lot other bridges beyond the I. forty bridge that they need confidence that these are going to be addressed. Because although this is something that was catastrophic that did not occur because it was caught. But not a state was caught by somebody not and that are not employee but by subcontractor. And as someone to represent the citizens of Arkansas they have a right. To know that you're going to address all the other bridges that might be of concern I don't know how to say it. More clearly that is exactly what we're doing I mean we keep we've done everything we can to restore confidence in our program. And I'll say it again and I'm I won't back down from that and we are taking care of it. I'll just I don't know how many times I need to say but I promise everyone in this room we are taking care of the failure in the process and once we figure it all out will report back to you there's a still a lot to info there still may be other people that need to be reprimanded are held accountable but we are doing everything in our power and so from this point forward we need to work on the I. forty bridge in restoring confidence we understand that. Senator Hammer you're recognized for a question thank you Mr. The Director tutors I understand or hear too far left. As as I understand it we're responsible for the inspection state of Tennessee is responsible for the repairs that correct. That's correct. Is the Tennessee. Our transportation going to hold us liable for the expenses because of the failure to identify the bridge and the bridge center where they have a legal ramification gets to us as a state that will cost your agency money. That has not been there has been no mention of that whatsoever they've been completely supportive and I will say that there are nationally recognized bridge engineering experts have said that this failure whether it was caught now or in in the past would take the same remedy this is a fracture critical bridge so it you know. I'm not going to try to minimize the fact we should have caught it earlier but it wouldn't cost any more today than it would have cost in the past because we would have done the same remedy in Tennessee DOT is completely supportive they have been nothing but a good partner and they and they appreciate all of all of our efforts to this point of our transparency and I just see this being a an opportunity for us to get better with our inspection program to shine a light for all of the nation every DOT how critical it is to make sure you have those checks and balances in redundancy in place in your program so if the point is not doing their job it is caught quickly and dealt with now this we're poster child no doubt but this is going to help the whole nation and I'm so thankful that Michael Baker international saw that the failure reported it quick action we closed it down there was nothing that happened. What could have happened didn't happen and I thank I am a believer and I thank god every day for that because the bottom line is is the safety of our for our people and I add I just I do I will just say if we had to fall on the sword to wake up everybody in this nation about how important it is to make sure bridges are safe then so be it. Thank you. So committee members should give you a heads up where we're at we're going here pretty good size report from EVD in a few minutes with the actuaries. Most everything we've been asking questions on here was discussed in the subcommittee earlier this week so let's keep our questions to the point and new information and let's move forward because we're going to be here a long time otherwise and I have eight other people in the queue so with that I'll go on to the next person but just keep that in mind. C. thirty seven. Which is represented bait baiting. The right director to earlier this week at the subcommittee meeting there was discussion of your previous role and are not. Could you remind the council what that role was and the job description and duties of that position. My current position before they named me director was deputy director chief operating officer I was second in command. I was over all the operations of the Department engineering and administrative. One one follow up earlier this week to the subcommittee question was asked if there were other inspections of the bridge or bridges one of your representatives one of the employees stated that there were paint inspections of the bridge. Yanick reviews and inspections of the pain on the bridge could you provide the council with the dates of those inspections and who perform those inspections from twenty sixteen to current. I can't at this very moment but we will send that information to the proper appropriate person to distribute to the committee thank you. If you would send that information to staff setting it out to the full council. Yes Sir. Senator Dismang you're recognized thank you Mr chairman that's going to follow up senator hammers questions about you know the breach of our responsibilities in regards to the review of you know of the bridge and in in in when we say maintenance and and when they do the the work out Arnott's responsibility for all of the costs associated with repairs do we share of those costs or they're just the managers of the construction is that they're the lead but we pay fifty percent they take the lead in construction we take the lead in inspection but we share equally the costs fifty percent okay and and I will be curious if that breach you know of our responsibility as far as the review of the bridge is going to lead to some further action if there is a development I would appreciate notice notifying at least the subcommittee of that because I I have a hard time believing that we've entered into an agreement with another state we didn't live up to the expectations that agreement and there's not going to be some type of a recourse I but the one thing that I want to do wanted to just mention is when we talk about this wake up call and what I hope it is is a wake up call for you know this committee the subcommittee and everyone else involved if we go back to the report that was issued its conducted by you know this body. One of the things that consulting kept coming back to over and over again was that there was not there is a lack of processes in place not just did not disassociated with their view the bridges but almost across the board that there was not a mechanism of how those items were reported reviewed or checks that was not balances again that was over and over that was the primary thing that I took from that report and I hope is not just on this maintenance side or this review side of our bridges that we're going to hone in and hopefully refine our processes because the other thing that we kept hearing a response from our dot was over and over again its in flight were working on it it's you know we're developing the process there are so many things that were mentioned that are in process or in flight I just my biggest fear is that we're not going to have the follow through to see those things accomplished and I hope that this legislative body is going to hold are not accountable and we're going to follow back up and we're going to make sure that we're doing what we need to do to properly manage your the department with that at Preciado that may have little time sharing. Thank you represent Dismang. How many Senator Dismang I'm sorry. Not trying to give you a demotion. House center Gilmore I'm trying to recognize everybody that hasn't been recognized yet so Senator you're more you're recognized thank you Mr chair director tutor thank you for being here up. Is that better. Enter into representative Cavenaugh point and Senator Dismang point I think our role here is to try to determine if the appearance of systemic negligence is really true and to that point to follow up on Senator garner's point and and his question I don't I didn't hear an answer but maybe there was one was the person whose duty it was to inspect the bridge in nineteen and also this year was that person responsible in twenty sixteen as well. I don't know the answer that question at this point I'll submit that to the staff to get to the. There's. Senator just fill. Four that is proper motion drive second. I have a second all those in favor say aye. All opposed no ayes have it so with that we'll move to the adoption of the report all those in favor say aye. All opposed ayes have it so with that we'll move on to the To the next page with that members only bring up the fact you guys all got a voter if you look in that folder there's a thumb drive it has a power point on it for your use in your district like a rotary clubs civic clubs as all the slideshows for the acts that were passed during the previous session all members got that just to your right heads up on what you got in that packet. Will move on to H. I will need a motion on aids to as the Arkansas infant and child death review panel Need a motion to refer it to the Senate and house. Your. Are your. Right and I got a motion to refer that I have a second all those of favour say aye. Oppose ayes have it reports been referred number three on the motion to file both reports reviewed on the Arkansas teacher retirement I got a motion second all those in favor say aye opposed ayes have it so we moved down to number six and looking at six at the Arkansas after a D. F. A. in a motion to file is reviewed. Our motion and a second All the favor say aye opposed us have it with that we're going to be made a motion to approve ADC of commission on rules services. Got a motion second all those in favor say aye All opposed Is have it. So that brings us to J.. And we'll get to. What would go to I'm sorry skip that so with that we'll move on to the EBD so with that we'll bring Jake believed in his team to the table. Thank. Secretary Fletcher if you would you and your your guys show it introduce yourself for the record and. You're recognized to start to report. Thank you Mr chair and committee manner members we appreciate the opportunity to present to you today we've been asked to give you an overview of the Arkansas state employees and public school employees health plans I have with Mr Courtney white from Milliman are actuarial for farm out of Atlanta as well as Mr blade our new director of employee benefits and secretary Walter of DFA as well as the chairman of the board of finance. At ten oh four gave the duties of the EBD board over to the state board of finance. The Division of AB day is still intact in a division under transformation in shared services employee benefits I'm sorry. I'm getting off my notes there's the two plans are very different and they have very different benefits they're both self funded plans Blue Cross blue shield health advantage administers the plans by negotiating with providers and reviewing the claims then EBD pays the claims does all of the customer service open enrollment retiree benefits and the day to day business. We have the contract with Milliman as I mentioned in you're going to hear from them this contract was procured through an R. F. P. and they began working with this in twenty nineteen we cover over a hundred thousand lives of state employees public school employees and retirees. We do have a reserve fund that you're going to hear about it is necessary with the self funded plan to always have a reserve fund as so we can pay the claims as their incurred. The health plan goes by the calendar year not the fiscal year and the board of finance now has the responsibility to set rates for the next calendar year which will be twenty twenty two historically that is done in June of each year so there's time to publish those rates to let members know in the event that they want to change plans based on the costs for the upcoming year in open enrollment in October each year. We're going to give you the current financials today and where we stand just remember this always changes monthly and we get new updates for Milam and each month on where we stand. We are not in a deficit today the projections are for the end of the calendar year twenty twenty two and if we do nothing we will be in a deficit but that's what we're here to discuss and I'll turn it over to Mister white. After. I'm gonna spend about five minutes each on the state employee plan and the public school employee plan just giving you a high level look at the the projections for twenty twenty one twenty two these are actuarial projections so we're we're looking to predict the future and so any prediction of the future is dependent on you know what your starting point is and what we think is going to change between what our starting point is and where we're going so one curveball to that is is twenty twenty had a major impact on the medical claims as as you all know and have probably experienced yourself so we we pretty much have to ignore what happened in twenty twenty for the medical claims and so we're jumping off from way back in twenty nineteen and trying to see what with this going to happen in twenty one and twenty two so the the ultimate we're assuming that care is going to return to pre covid practices for medical care for prescription drug coverage pretty much followed similar patterns is pre cooked during code as it did creek during coveted pre COVID so I wouldn't see material changes there. Okay we're gonna start with that with ASC so um as a note over use in use in data as late as February twenty twenty so right before the pandemic started and we started sheltering in place and reason pharmacy data through generate twenty one says the most recent data we had for this report. As you look at twenty twenty one a couple things to keep in mind so the way that the EBT board operated was when there were surpluses in the year that money was set aside to help offset expenses in future years so if this doesn't example if there were ten million dollars left in nineteen. Fifty percent of that would have been put aside for twenty thirty percent for twenty one and twenty percent for twenty two just to help it's almost like to help stabilize experience and stabilize the rates over time. And so you'll see references to before and after surplus in this presentation that's what that refers to is that money has already been set aside as money your marks to help offset those expenses. So for twenty twenty one for a ASC prior to using any of that prior your surplus for showing a twenty point five million dollar loss. And this money that was set aside for twenty one was fourteen and a half million dollars so right now we're showing a loss of just this right around six million dollars. As we move into twenty twenty two. this is the status quo scenario so this is the presentation that was provided to the EBT board before they made any decisions before the control is given to the board that the board of finance so on a status quo basis. Before any the prior surplus numbers were shown a thirty three point three million dollar loss we've got about six million dollars in surplus from prior years so we're showing twenty seven point two million dollars in and loss for agency for twenty two assuming no changes are made and again this is you know it's all soums that everything's going to return to pre COVID levels you know we're it's still unknown I don't think we know a lot about what's happened in twenty twenty one yet either so as that as that information becomes available we incorporate that into our projections and an update the the future. Members of we could keep the conversations outside rooms having heart difficulty hearing. At the next table is just a graph is a a tabular view of what I just went over the you can see the bottom line number of the the negative five nine nine for twenty one and then they give twenty seven twenty two one four twenty two that's just the details behind that's that cash flows of what's coming in and what's going out. This next one is what is I think is really helpful to help point out what's going on the green bar is revenue in millions the yellow bar is expenses in million so that's claims and administrative expenses. The the red number at the top is the loss. Prior to any surplus uses and then the gray bar is that is your cut your your reserve that you have available to help fund losses or catastrophic reserves or future future premium offsets the key number there is the the blue box in the middle so if you look at twenty nineteen to twenty four point one. What that represents is how much reserved you have as a percentage of your expenses so right and twenty four and twenty nineteen we're at twenty four percent so almost a quarter quarter per almost twenty five percent so thank think of in terms of how many days is that so twenty five percent is a is a fourth of the year so that's like ninety days of reserve as you move into twenty one twenty twenty one twenty two you can see what's happening to that percentage it's dropping pretty significantly as losses for the year were funded more out of reserves than they were through changing employee contributions or benefits or further state funding so by the time we get the end of this year we're projecting that are reserved only be about just over ten percent of over expenses that's about you know thirty five days or so we would normally recommend the reserves be somewhere in the sixty to ninety day range just provide adequate protection against high claims catastrophic events unforeseen spending things like that or or or that you just you have you have Mrs Julia we might say think that there's going to be a five percent trending it and it comes in hire for various reasons due to you know more utilization by employees and retirees or different use of different services so so then we get into twenty twenty two we're showing that we're only gonna have about two two percent so that's. I was at seven days that's about a week so even these are S. C. spends I think just just around a million dollars a day so we need to have you know I. Somewhere between sixty and ninety days in reserve so what so what this is this is a summary of what the EBT board decided prior to control being get over to the to the board of finance so start with the thirty three point three million dollar loss at the top and our goal is to cover the twenty twenty to deficit and have enough money in our surplus to have a ten percent reserves we know that's that's on the low end but given the level of deficit. And the amount of effort it was gonna take the cover that that's where they decide that to kind of draw the line in terms of of funding for future so you know the goal would be to level set twenty twenty two put a more strategic plan in place for twenty twenty three and beyond so that we can continue to get those reserves where they need to be so the table shows. Each initiative and what the impact is and how that affects the balance so that the the first two are just changes to the employee cut the paycheck contributions and the retiree premium contribution so those are five percent ten percent. The third the third fourth and fifth one are around the wellness program. So the way the wellness program which today is you have to actually have a physical exam by your primary care physician or by catapult to qualify for the for the reduction in your premium. Those two things happen so that one is EBT ends up paying for that visit. Because there's no copay as well and you get a credit on the premium side so it's like a double whammy to the health plan in terms of cost because you're they're paying money out the door and claims and getting less money and revenue and you know that there's there's been a lot of questions about how well do wellness programs work with a Wallace and programs are important because you know it's good about educating people on taking care of himself about how they can affect their diet and exercise and identifying early early diseases and things like that. But there's different ways to do it so one thing is that the we need to set the the the other board decided was do not require the wellness visit to get you can still have your wellness visit for free but not require it to get the health care credit on your on your plate contribution there's a lot of employees that are. You know say twenty five to thirty five they're healthy they don't have any history of conditions they don't need to go to the doctor every year to get a primary care checkup is most the time by the majority of time that's just money going out the door with no return there are other people that is going to find early identification of things so people can still go get those visits but is not gonna be required to get the credit so that's that's the read limits of the that's the elimination of the wellness preventive screening. And so what they decided to do was currently there's a fifty dollar gap if you qualify for wellness your contribution is fifty dollars less than someone who doesn't. So they decided to close that gap to twenty five dollars so the people who are on wellness would pay twenty five dollars more and institute a penalty of fifty dollars if you don't qualify for wellness now it's going to be a lot easier to qualify for wellness now you can you'll be able to go to an online H. array as part of your open enrollment and do a self attestation that you qualify so they want to create more incentive for people to be aware of those incentives and to take action personally and and be accountable for that but they don't know if they have to go to the doctor to get that get that credit. And then the last thing is thanks the state funding increased from four fifty for per budget headcount to Perm play for budget had counsel those are active employees those are those are positions that are budgeted by the state that's how that funding work so there's a little bit of a disconnect between how the money comes in and how the money goes out and cool and and and play benefits because not everybody that had come is filled not every M. that every employee. Not every budget position that is that is filled those imposed on all take healthcare so that there's a disconnect there so what into the day with the board came up with was if they created forty million dollars in savings so those first five items those are are pretty much born by the employees and retirees that's about fifty percent of the savings and the state picks up the other fifty percent through increasing the state contribution so then so at the end of all this our goal is to be at ten percent catastrophic reserve we're actually a little bit higher next we're picking up an extra six point two million dollars above and beyond what we really need but they thought that thank that was okay given that we're in we think ten percent is probably on the low side. Alright this next slide this this this is I'm not gonna go this this is just a lot of the things that we talk about with the board and we talked with the state of finance board so there's a lot of different combinations of things you can do and these are we did we we always want to show that we look at a lot of different things and and really try to balance the how how the employees and retirees are impacted by these changes. I do wanna stopping questions on ASC before we do PSE because I know it's a lot to digest. Okay members have Senator Hammer the first you're recognized for. Thank you Mr I will I was looking through here and this past session I'm at a loss for what we called it but it was the where the procedures were I think for the hyperbaric surgery you know where you can do the wait for the reduction weight loss and I'm not sure that was available to the state employees are just a public school employees or both do you now. It's available to both. Okay is that listed on here somewhere as far as a potential to remove it as an option because that was like six million dollars was that list is one of the options. That was not something that the former EBT Board look that reducing there there's no additional funded finding given for that procedure when it was implemented as a pilot several years ago it it it just says that we can expand up to six million three million of that on the state employee's side and three million on the public school employees side. And then there was a program you're looking at I think involving where they would actually look at the invoices before they were paid I can't hear what that was called up to capture duplicative duplicated payments is that factored into any of these recommendations or the projected savings that is something that we are still pursuing and looking at that we get will get in place bury St but now we did not account for that that could help us save more money and the numbers not be we save even more and the number to be higher than that six million at the end of twenty two once that's implemented we're just not counting on that and and putting it into the projections okay then my final question is so Milliman has prepared this report we've just hired you know consultants come in and take a look at it ourself I'm curious to hear from the Millman representative the differences that we think we're going to find with the consultant that we've hired versus what you've done and how much overlap or duplicate services there's going to be recommended and I just care share your opinion. Yeah we we we looked at the R. P. that was issued by the I guess this committee and there certainly are some overlap I think you know we're we're looking at. Short term and long term goals of the of the program to make sure that that you know number one you're covering your expenses today and number two do you have enough money down the road to get there we start we took over this in in nineteen we shadowed the prior actuary for about the for through the rate setting process for twenty twenty so we didn't really actually start being fully involved until fall of twenty twenty and we help set the rates for twenty twenty one and now twenty twenty two so yeah I think I think there will be some some duplication of efforts and and we're happy to help work with Segal to you know find the best answer for this committee and for and for the employees and for the retirees I think some of the things again I don't remember all the R. fee out of the farm had some the long term things that we're looking at in terms of demographics and I think some of the salary information isn't something that we've looked at in the detail but I think the I would at I can put a number on the maybe have maybe maybe thirty to forty percent of things are duplicative but we're happy to work with them and buy them data that we've analyzed help them provide input do you is there anything that you should have been doing that we're having to contract out to get a different consultant to come in in order to find those areas of savings should that have been under your scope of work under the contract you have. I don't think word I think we're doing what we should have been doing I don't think there's anything that we should have been doing okay. Our thank you. Senator Hill you're recognized. Maybe now thank you thank you Mr chair on go back to your comment while ago is made on the wellness checks we're going to go away with that streamline it make it easy for which you're still going to give every enrollee a discount on their on their feet on their premium. We're doing what wellness check. Is that not just rewarding them for going online and. The answer the questionnaire right and and and part of that is gallons not right I'm sorry it's at that that defeats the whole purpose. It if I if I can jump in here one of the things that we're trying to manage years of previously when we did the wellness program was it last year you're getting seventy five dollars a month for doing the wellness check we could get rid of the wellness program like you're saying the challenge there is that's going to increase the rates for those people by seventy five Bucks a month so what we're trying to do is ease out of this program without any kind of big big or overly large spikes and hits to how much they're paying I agree with what you're saying and I think that we in in a certain way all do but it's really just trying to find a way to and that program without causing too much disruption all at once on the the the folks who are covered and I agree with you there was losing to me like to be a lot easier if you just want to discount or write down that amount the same purpose. At and that's one of the things the board discussed you know looking at the active members is the well this only applies to active of course so what if we did increase the rates for the active employees at all where's the retirees did see a rate increase but we remove the wellness program what kind of a factor that had at the end of the day everything the board looked at the EBT board looked at is now before the board of finance board of finances take a broad view on everything there wouldn't to put everything back on the table there's a lot of been a lot of really good discussion I think that's a good point to bring up for the thank you. Senator Chesterfield U. S. thank you Mr chair one of the ways that we decided what we were going to do in funding education was to look at the surrounding states. And we've taken a look at surrounding states contributions to their state employees as well as the public school employees. And if so how do we stand. The. Yeah there's a benchmarking section in the packet that you received unfortunately I have not gotten to the whole packet is rather extensive begins on nineteen. Nineteen okay nineteen all right thank you. That looks the plan designs the funding looks is on page twenty. Right. So what we see benchmark this state the surrounding seven states looking at how much the state place how much the employees pay and and what their total cost is it was more we're trying to gather the same information for schools but it's all it's a little bit more difficult because it's not always is public and it's not always funded by the state in different states handle it differently so um but for the state employees. The employee contributions were the second highest of the states we looked at. These Plan funding was the second lowest so your employees are paying the second most and the state is conserving the second lowest of the seven of the eight states we look at clothing Arkansas. It's interesting. And on the bottom line is for next year for the upcoming year. What will the increase being forced or public school employees and what will the increase B. for state employees I saw something about eighteen for retirees I didn't get to the other part since I'm a retiree so that has not been set yet that that what you're looking at is the recommendations that the former EBT Board made on April twentieth been there recommendation was to increase it by how much on which one the stator or public or both okay. Syllabaries by benefit plan and various by what type of family structure you have the or any individual. An individual pays less room than us someone who has a family versus some. And it you know I was in education for a lot of years so I understand that part I just want you to tell me what is a proposed increase for an individual and what is a proposed increase for a family of say four okay so Page six shows you the summary of the initiative so it's five percent on active employees first this is state employees ten percent on pre sixty five and and post sixty five retirees and where you can get into the exact amounts on what that is per person and per plan. Again twenty eight on page twenty eight okay that's what I. So an example would be for a state employee that's the employee only their contribution would be at increasing by thirty two dollars and twenty cents in twenty two from what it is today if it was a family plan this is on the premium there's three tiers there's premium classic and basic most of your state employees have are in the premium plan so if you had a family and that it would be increasing by fifty three dollars and seventy five cents and for public school employees. So the summary of what was suggested on the public schools employee employees is on page thirteen that would be a ten percent contribution increase for all across the board actives. Pre and post sixty five retirees. Indeed you out like you did with or to the cost ma'am on thirty two is where that's located on page thirty two yes ma'am now on your public school employees most of them elect to be in the classic plan which is that middle tiered plan that we haven't discussed the public school employees Senate Celeste don't cloud the water before we get there so if we could hold all the questions on the PSC until we hear the discussion on that please okay not a problem this year I just thought we would cut to the chase I'm running a lot of folks is how much more might not have Hey because we have given people raise on one hand were seen to be taking it away on the other hand with the help ensure just don't want to get confused thank you. So if you would this time I'll hold the last five questions and let you guys discussed public school funding because I'm sure some of these questions be both ways that way will compare apples and apples. Okay thank you so for PSE it works the same way one thing that's different about twenty twenty one is there was out a special twenty million dollar funding from the department of education that was used in twenty twenty one so we're showing prior to any kind of practice surpluses from prior years there used to offset expenses a twelve point seven million dollar loss got fifteen and a half million in reserves to help offset those expenses so we're showing a slight gain of two point eight million in twenty twenty one then as we roll into twenty twenty two again status quo no changes same thing play contribution same benefits everything's the same we're showing a loss of seventy million before the any of the prior allocations and sixty three million dollars after that. Here's the the tabular look again again it it here's the thing the three point two one seven nine nine at the bottom there in the sixty three as well. And then up to the top you can see how the department education funding went from ninety million there is a twenty million dollar on going increase and then a special twenty million dollars and twenty twenty one so it goes up forty million and then down twenty nine because that that second twenty nine gets taken away. All right so again looking at the how they how the cash flow affects the of the reserves. In in the green bars revenue in millions the orange the yellow bar is expenses the red number the top is your is your losses and again that that little blue box in the middle is is really the key takeaway so um in twenty nineteen we had thirty four percent of of expenses in reserve so that's more than a month so more than are more than a quarter of all right thirty years that's almost four months for the reserve and then it's it's just like a it's a it's only going down over time as most of the changes year over year have been funded through servers rather than increasing employee and retiree contributions and changing benefit designs. Okay and then here is the initiatives from the EBT board again these are these are. Are not finalized as that a Board of stable defines took over one thing that was different with this one is the funding was a little bit more unknown because on the on the states I we know what the budget head count was and we know amount per month is and that funding had been increased the way the school board is the schools are funded through lump sum from the Department education and then the school districts each have a minimum contribution and so that minimum contribution is you know one hundred and sixty four hundred sixty five dollars per member per month range the schools can choose to pay more than that. And all that does that money goes to reducing the employee contributions in their school district it doesn't go into for further funding the healthcare plan so that's just a it's a decision they make at the local level to provide additional benefits to their employees so. The approach the be the board took on PSE was. Given that we don't know how all the funding would check out because there is another mechanism to get more money out from that. What's the what's the furthest the board can take it and then leave it up to the legislature to help see if that's far enough or with a few other funds available to offset that so they they made all the same changes that they did for a seat the increases are a little bit higher ten percent fifteen and twenty percent that's prime as German for two reasons one is the deficit was a lot bigger and number two S. C. hasn't had really many increases over the last five or six years I think they had two percent one year in a bid to representative for that were healthcare's going up five or six percent year they've had pretty smaller increases year over year over year so those increases are are larger their contribution levels are lower are are different so that it may not be quickly to what what a CSO at the end of the day what we what they came up with of the seventy million dollaz they came up with forty million dollars in savings that that's the least thirty million dollar deficit. So at the end of twenty twenty two if we put all these things in place we would still be thirty million dollars in the hole we need to thirty million dollars really to fund the catastrophic reserve because that you know the expenses are projected to be about four hundred fifty million so that would that would get us from We need to be about forty five million at that at this level we're about fifteen million so that that really gets back up to the ten percent level. And again these are just the and other initiatives that we looked at as part of the Discussions with the board. Your look at the premiums on PSE now that's on page thirty two. I think it starts. The Secretary venture was saying most the people are in the classic plan which is that middle section. So an employee only person would go from seventy one dollars two hundred three dollars that's a thirty two dollar increase someone in that same benefit plan with the family would see a sixty three dollar increase Page thirty two. Thirty two. So committee. Just for informational purposes. What we did in Senate bill six ninety three Senator Hickey is in the room none of this that you're here today is final all this will have to go through the personnel subcommittee and and through council with a report from the personnel subcommittee so this is just a report on where we're headed so you have a heads up of where we're going not this is the final approval for these rates. So to make that as clear as I can but I don't know but maybe Secretary Fletcher can give us the insight what month do you think. We'll be seeing this will it be June or will it be July. Well as you said The New act gives the power over to the board of finance so these recommendations were made by the former EVD Board and now the board of finance is evaluating those and we have met three times secretary Walter may want to speak to the timing my preference would be that we make that decision in June but I'm not sure if the board will be there by then and it's all about timing it's about timing letting members know what the upcoming cost are is where the urgency lies in this I'll turn it over to secretary Walter. Thank you Sir thank you senator Thatcher on. First of all the board of finance is has a minute existence for quite some time and we have been normally dealing with the financial issues of the state and investing the money and working with the treasure and and really don't have any expertise and in the area that we're and embarking on so is there's a learning curve the person that saying that was there there's a learning curve associated with us understanding more about the insurance plans and then what we have you know what sort of leverage you have to make changes of those plans in order to make them solvent we met immediately of the C. O. may the seventh we had a our first meeting it was a special meeting the state board of finance of that was on a Friday afternoon on Tuesday the following Tuesday morning we met again that was the regular no she that was the the then we met on the eleventh which was a. A meeting where we started taking information we and Miller was there EBD the staff secretary feature where we started understanding what heads what was what had been proposed previously what sort of options we have understanding the details behind it we met again homes on may the eighteenth. And which was last this week we have a meeting on the twenty fifth which is next Tuesday so we're we're basically meeting every week on Tuesday trying to get an understanding of what we have and what what we have to do and what information we have to analyze in order to make a right of an appropriate recommendation to this body with regard to the insurance of the non the written the rates the the plans themselves as well as the contribution that we believe the state may want to consider going forward the committee it has been mentioned that thank secretary Jimmy will someone asked the question having to do with benchmarking other states when you look at that we are. Own the the amount that we provide in support of these plans we're you know we're next to last in in that and we're also the second from from the the top of the highest when it comes to the in the premiums that are employees pay so I think that's the consideration that this board will want to make and as we develop our proposal to you we're we understand the importance of what this. What this task has been given to us and we're gonna do everything we can to make balanced recommendation now having said that we've got to be be comfortable with what we recommend to use so we're gonna we're gonna look at what the former EDT board proposed we're going to look at what they other considerations they had and then we'll make our decision or what we think of the direction ought to be at the same time we we have another consultant that will be also working and I salute you the BT staff will be supporting them to some extent to the was the name of the company Siegel that this been hired and and obviously will will need to be working in concert with them so that as we move down this road will get the right the best decision for the state employees of the the public school employees as well as state employees. I don't know at what we're not gonna make a recommendation to we feel comfortable with that recommendation I am want to move faster because there are. There's a timing where employees need to know what their choices are so that they can make the proper choices. Relative to the insurance plans they're going to have in twenty twenty two so we want to do that as quickly as possible we understand that too. Representative back you're recognized for a question. This is not more related to the wellness aspects that we talked about earlier you know initially when I was proposed that was a long term benefit right you know we're going to capture this stuff and we can save a lot of money this catastrophic events later in life and so full of some of these people so what my concerns are non. Have we done anything this is okay yeah we're going to save some of the short term by this pull back but. Are we calculate how much we may lose long term later on with increasing cat catastrophic health care means. We haven't done a study specifically for the EBT population of S. C. population but but there are there's published articles and and studies done on Wellness programs and I don't the most of I'm implied that the return on investment is is very small so the savings that you might have thought you're gonna have before. Probably didn't occur and you're not gonna lose it. If I can jump in on the one of the the challenges that the EBT board had and the board of finance now has is that there really aren't any easy low hanging fruit options we're at a point where we need to come up with ways to save money for the plan and some of the some of the ideas that are out there I think we all agree that there's a lot of merit to wellness it makes sense but if we can't show in R. O. Y. on and we're in the situation we're in. Given all the other options none of which are particularly good we had to make it the board felt I think like they had to make a decision to go in that direction. Senator Hendren recognized. Thank you thank you Mr chairman I'm having a little bit of it deja vu here to two thousand fourteen and I guess you know as you all know there is a special session the plan was emerging cash and we came and put I can't thirty to sixty million dollars in into it. And we created a task force that came up with several legislative recommendations that were implemented I believe in two thousand fifteen and I can remember Senator Ingram who is very involved in that myself talking over the next two or three sessions as we saw one after the other of those things either eliminated or removed and surprise we're right back where we were so I guess what I would ask is and I know some of that a lot of that some of that was done by EBT real and some of it was done by legislation. but what I would ask is would it be possible for you all to put together a summary of the changes that happened since that last crisis since the lead with the laws that were changed the regulations were changed and the costs that are associated with that because as we know after we did that the plan was flat for several years not we all know that healthcare costs are increasing and everybody's getting insurance premium increase but I guess what I want to be able to sort out is what's the difference between normal increases in healthcare costs because of the market. And because of changes that we've made since the last iteration of this crisis. We can do that thank you. And if I can jump in on that some of the things that were institute in twenty thirteen were still doing today are still very effective. Yeah and again I'm not saying you're changes on the wellness are not the right thing to do but I am a little bit uneasy because I know that was something that we hired a consultant we spent nine months looking at the long term effects and I heard the testimony here this morning that well it doesn't help most but it might help some and what we were told at least the time was the research those some that's it it helps are incredibly expensive to the plan if they're not diagnosed early so maybe it's the right thing to do but I know when we study the last time it didn't turn out to be the right thing to do based on the math and the numbers from our last council so again I'm not saying it's the right thing or the wrong thing but I I sometimes it's easy to take a short term gain and not realize a long term price if you're gonna pay for that in the plan so that's why I'm a little bit really wanting us to see water all the changes that we've made since we spent. Several hundred thousand dollars in eighty nine months of study trying to fix this last time so and and I haven't read the I know that there was a lot of work done on it there's a task force probably a lot of different reports that I haven't all gotten to the bottom of one of those was the the pharmaceutical drug contract reforms which are really in a lot of ways one of the strengths of the program to this day so there are a lot of aspects where the lessons we learned in twenty thirteen or helping us right now absolutely. I'll just add from from the EBT board the former AB de board's perspective and now the board of finance on the public school ends employee side We can control more on the state funding we can recommend and they did a fifty dollar increase on funding per member per month but our hands are tied because of the school funding formula on what we can recommend that the state side does so. This is where where the board with. Ahmed was referred to that too is I agree with what she said we need to be looking at as we go forward in the future and making sure that we. Adjust the the premium rates and the employee she the cartridge from the state on an ongoing basis as opposed to not you maybe what we've done the passes we haven't done that on a regular basis and we have the increasing cost of health care which we all know about we're we're not we that was occurring the expenses are are being paid and yet we don't keep track we don't keep pace with that with the premiums that we that the employees pay and the the state portion so we'll we're getting behind the one of the favorites organized because of that. In my opinion so we need to address that going forward. One of the comment to the with regard to the state employees I thank the dissolution the of the chewing the the immediate fix is going to be a lot simpler than the public school employees the numbers are not anywhere close we are building at a ten percent reserve. That's not adequate going forward in my mind and in the in Arkansas as well as we need to be thinking about a larger reserve for catastrophic sorts of events that might occur out there and so that will cost more money also that that's not and in the numbers that you see today because we just put in a ten percent reserve. President Cavenaugh you're recognized for a question thank you Mr chair. When when we talk about Arkansas place the second lowest for their portion for the employee employer portion does that include the money that we paid for on field positions or is that just for active so we get an idea what we're actually paying. Yes so that would include total funding regardless of whether or not the funding is provided to positions vacant. that also covers funding is provided to a position that has an employee in it who is also bringing along their wife and seven kids it the funding is not structured really recognize that thank you. Senator Tucker you're recognized. Thank you Mr I understand that the Rev recommendations from the BT border not finally we doing your own evaluation I understand that I noticed on the state employees. There is a proposal to increase the monthly state funding by fifty dollars per month which as you mention made it so that fifty percent of the cost increase was for the employees and fifty percent was for the state then when you get the public school sign. Not only was it not included to increase the monthly state funding it wasn't even on the list of considerations and apologies if I missed the explanation on that but I'm I'm curious if you can explain that why wasn't included before if you all will consider that on the stand on the public school employees side moving forward if not why not and so if this is one of the big differences between the two plans is on the state side the old EVD Board and now the board of finance have the authority under law to increase the amount of the agencies are billed per budget position right now it's capped at five hundred fifty dollars previously was at five hundred. On the public school side it's a much different proposition because the state provides funding to the districts for salaries and benefits that flows through the adequacy funding model. Then over the years the state has provided a hundred and it's now a hundred and ten million currently this year is a hundred and thirty million in direct funding to EDT through the department of education's budget. That comes as a result of the budget process it recovers result of the educational adequacy committee recommendations it does not come as a result of any decision or authority that the board has. To the west the legislature would have to do that yes Sir thank you. The representative makes you're recognized English trucks of of a two questions on that the first one is going to go back to what Senator Hendren talking about back in the twenty fourteen issue we had a we had a problem with negative selection where the rates especially in the public school system became so high that we had a lot of healthy individuals that were looking for alternatives and yeah I know in my own life that my wife and I are beginning to look for alternatives because the rates are or continue to climb on the the state employees as you do your calculation on these rates are you comparing them with you know the the health insurance market place or these medical sharing programs. To dynamically look at if and as we set these rates are we going to create a negative selection which is only going to further increase our costs and put us in a more difficult place versus making rates a little more affordable which would entice more people come in and would further help to strengthen the system I know there's a balance there but is that something that you all consider in your in your. Explorations yeah we look at the rates on the exchange for affordability issues to see if there is anything that that might be a red flag you know every every it's. The employee contributions the state pay don't represent the full premium that it costs to run the program right here you're comparing a lot better apples and oranges so right you know you Sir that you would expect the state contract or the employee countries of State to be lower because the state is subsidizing some of that. If I could add are planned to is very rich and benefits more so than most corporate plans or even some other states the proposals that were made by the board did not touch the benefits in any way and and most of that was based on feedback that the EBT Division received as well as the board and many of you that we were told that people would rather the rates go up then there benefits change. Because there is always that option as well about my second question is has the the board the state given consideration to almost hate to say it create a school nor nurse kind of situation but you know here on the on the capitol complex we have hundreds of state employees and has the board look at the option of maybe creating a nurses station or doctor station so for every day medical type things an employee could come here and get that care from of somebody that were employing. Versus going out to a private provider and using that as a cost saving mechanism obviously you couldn't do that everywhere but where it made sense have you looked at that it hurts floor that is a possibility that that wasn't an option I think. The capital cost might be a little bit deterrent to build that and be able to meet all the requirements to deliver care and another other large employers that do that that that's the because it creates a fixed cost for your right instead of that you can control the trends a little bit but that is that something that that maybe we should consider though. I'm just on that out there food for thought you. Senator Elliot you're recognized for a question. Thank you Mr chairman when we did the benchmarks and compared to the other states did we just look strictly at the premium. Or did we also look at parity of benefits as well. Is it just a pure number we we tried to mask the benefits up as close as we could you know they're not going to be exact so and the different composition of who has coverage employees versus employees and spouses employees families because of the state has you know if your spouse has access to group insurance they need to take that before they choose state insurance that may not be the case in every state so we tried that we use that differentiation to to try to line them up with us because that's basically what's and also in the other states where apparently and are there been several years or we've not added anything to the health insurance In these other states have they been quote unquote I guess keeping up to date than making contributions incrementally as they've gone along that is kept them more in line with contributed and more than employees are contributing. We can look at the areas we're just focused on twenty twenty just on twenty. As it I thank to me it seems common sense that we would not be making our contributions that we should we're going to get behind and be right here that makes sense to start with but it might inform us some if we know that this is one of the ways other states are keeping costs more in line maybe worth looking at I just to give us some another way of thinking about how we are going to find health care as well as we go along that's a huge issue and I know and when it comes to the PSC's when we've funded the school formula. We we also have you know the issue of. We it is a it is a funding formula. That is not dictating formula and every school district can decide how much they're going to put into a healthcare for the employees And that may be something at some point we need to look at when it comes to health care. because if there is a way to think about it outside of that formula so that we can have more consistency well. By the way we fund public employees and school employees that might be helpful that's going to have to think a little differently I think no I think you're right and one of the things that we want to do is build in those revenue streams year in year out incrementally takes some of the the kind of herky jerky nature of it make it a part of the budgeting process yeah okay all right thank you. President will you're recognized for a question. Thank you Mr chairman this this is directed to secretary. furniture and Secretary Walters you know we've we've had discussions relative to how we're budgeting. End of it I guess I got to have two questions the first one is will this plan a lemonade the deficit so far as we know it and what we've seen us C. seventy million here for the public school employee fund that does that includes the twenty million that we already approved yes we got a Jake shaken knowing Amy shake it yes there was well there was a twenty million dollar increase for twenty one that carries into twenty two there is a one time twenty million just for twenty one so includes with that was twenty miscellaneous is in the seventy or outside of it is it is is in there so we're looking at seventy million there how much are we looking at for the state employee plan. Thirty. Thirty thirty three thirty three two so that's what we asked for that's what you came back to this four is that right. Then no Sir that's the amount of the board of the old EVD board recommended they took a number of measures that they put into place two nine not only feel that thirty three but also give them additional funding to carry forward as a result. Looking about a hundred hundred hundred five million that we do nothing okay can you all can you know sure is that this is gonna be different I mean. Here we are again and we we go back to this is what the teachers went through ten or twelve years ago was state employees are going for a C. an average seventy percent increase here for us that's a bunch of money for folks owns the only state pay roll. One thing that we recommended to the board we first got involved was that there in there needs to be some guiding principles like. What what what are planned as a board to help run this program there was really not a lot of structure right how they made their decisions I think that tie their hands some degree because they they you know they don't work in healthcare in they didn't actually know what the right things to do and not do worse so um. We as we transition over to the state of the the board of finance that's that was the first question that we got from it was our are there some kind of rules of engagement or some guiding principles how we do this and and I think that having those in place and and being disciplined to follow them you know we're gonna put in a minimum increased employees and retirees removed every year and it's going to be you know at least these this much and maybe there's something around. We're always going to have this many months of reserves and we're always going to and if we have to cut benefits by X. percent per year we're going to do that and being able to be disciplined enough to stick to Amanat not give into the pressure of okay we don't want to raise people's employee in contributions it it's their hard decisions but everybody knows that as we've also the healthcare is going to go up five six seven percent a year and if the funding is not keeping pace with the cost to get it back and that you get back into this situation very quickly that that that's what we want M. J. can I want to build in a formula that you're looking at you know your your expenses for the last year and is this cost and medical expenses are going up each year we're ingesting on but the state side in the employee side and it's something that that we we make part of the culture it hasn't been but but we want to do that so we never get back and in this shape again so so for example right now for the budgeting process you've been on the budget committees you can personnel do you recall ever being asked or has the legislature's been consulted about an increase in employee insurance costs and of course that's not something that we bring to you all as you pointed out we'd like to bring that to legislature we like to bring that to the Joint Budget Committee would like to make that part of the annual process. What follows Mr chairman. We talked about the budgeting process we've been playing this Amy put it one of our meetings the shell okay with the five hundred and fifty dollars and time it to employees now we've passed legislation on the vacant positions of over two years and the FAA and transformation had input on that legislation are we going to change the we're we're gonna have a line item take in the budgeting process for X. amount of dollars per department per employee so we'll know exactly where we are in the report come monthly to the agency. So right now the way the reason and this is the best recommendation I have I've gotten on why we do it per budget position is not necessarily because that's a way to somehow spread the cost out across the folks who were benefiting it's all about harnessing the federal dollars to cash this special revenues that are out there. Understand that but we've got to admit the system we're in right now is not working it's failed we've got a hundred million dollar deficit so are we going to change it to where we have a line up with their federal employee or state employee and you're gonna pay that benefit divide that a male or multiply that amount by the total number of employees and come up with the number this going to cost each agency and use that I mean that way we know we don't know we're playing this shell game and moving the numbers are right now and the employees not a positions no even fail of not even filled and we're we're funding the insurance and I understand what it is it's it's the intent is good but is not transparency relative to what we're doing for the is it anything well it we're doing that for to to make sure that we're not leaving any federal dollars on the table we're doing that so we don't leave any that special the cash revenue that's the whole reason is there I don't necessarily think it was intended to be a transparent reflection of costs but any information this body needs anything we need to do to make you are more aware of how much we're spending on healthcare as you know we're going to do so so what are you gonna make you the line item budget line item in the budget. One one total dollar per department. That I think. Overall we need to have a policy R. R. a series of policies and talk about what we believe what we this body and what the administration believes is our commitment to the health care and program for the employees and for the state employees and the public school employees that may I be a part of that out it could be adapted that way I see it being of going that way right now the public should give me the The in the state employee's contribution is coming from a. Per budgeted employee number which we're right now the recommendation current recommendations for a five hundred I thank the it's actually four hundred fifty today is that correct. And we're talking about raising it to that we also need to do the same thing with the public school employees determine what how much money we we as a policy believe it should the station support the public school employees and put it in the budget and identify specifically I think that's the only way we'll be able to do it because we were there is money going in from the department of education today and sometimes they change it. Based on all things like we've talked about here today they we've talked about it going from but the one hundred million hundred thirty million was it one year hundred twenty I think this year is gonna be a hundred and what is not what she read twenty two hundred hundred ten million so there's money going in there but I think in an incident five within the education budget maybe it should be and identified within the budget specifically so that we know what the contribution or subsidy to health care for employees and public employees public school employees is I'm I don't have any trouble that I think that's something we probably ought to do. One one more just are we going to represent when you to put to the alert and we're on the non represented employees represent Worden I've got to move on to other members thank you Mr chairman. Representative fires and you're recognized. Thank you Mr chairman I'm over here. A kind of back to what Senator Hendren was talking about in the wellness credit as a health care person and someone who has employee insurance I can tell you the online assessments a complete waste of money and time but I do think it's important for people to have a wellness visit coming to pick up you know it you don't know your diabetic but if you have a blood test in your A. one C. is higher cholesterol higher you have high blood pressure it's important to know those things and I understand if you're saying it's a cost I mean we have to think about cost if you considered maybe instead of making it an incentive make it a cost if they don't have a wellness visit to maybe increase the cost the price of insurance for those people who do not have a well this is it because I mean not all across the nation what we're looking at now is not just having health care coverage would actually improving health outcomes. Yes and and I agree with you having the opportunity to have that wellness visit is very important and we the recommendations that were made by the B. D. board did not eliminate that what we have found is they were going to our on site clinics you know that we provided and and getting that that visit they were many people were also going to their own primary care physician and getting a wellness visit so there was a double charge there for the plan this is S. the plan was recommended by the board that former EBT board it would not eliminate anyone going and getting a wellness visit from their primary care physician and it would be covered as Mr white was saying that there are many people in an age category that might not need to do that every year if they're younger and healthier so they may not do that every year but it certainly doesn't prohibit that also yes we did look at a disincentive verses an incentive and that is one part that is recommended it would there would be a fifty dollar. Charge for those that are not doing the wellness if we went with the recommendations from April twentieth that that was what the the former EBT Board had suggested. Let me get back in it why if you're following the CPT code for a wellness visit would you pay for twice that I mean they should be picked up and claims management. That's a very good point I think that we've been asking the same question. Okay thank you. Senator Johnson you're recognized for a question thank you Mr chairman of I don't know where to direct this I'll just throw it out there to all of the I appreciate what Senator Hill and represented Ferguson and sat on this I'm. I'm concerned about doing away with the differentiation between the the well people in the wellness side and the other side not just the cost in but the. What you're the biggest test in that whole thing is a smoke. Any actual or it does life insurance tables you look at him what are they make the variational do you smoke or do you not smoke the smokers are the burden on the system compared to the non smokers and while I'm not sure everything in that screening. Would have us catch people that have you know conditions are at risk for I hope we would do but compared to those that are smokers and those are not people that endanger their health by smoking you've heard doctor Joe Thompson said appear in Telesis numerous times you know they're costing us more money hi and that's why I have a lot of problem with the idea of totally doing away with this orders representative Ferguson led to having people go online or if there's a way they could swap their own mountain send this thing in or something fine but. We've got to. I think we're making a long term mistake by eliminating that and I appreciate what the the board not blame Yellville what the board did to try to look at some savings and yes this costs but if that's using the law of averages is like that the man standing with one foot in a box bucket of boiling water one put a bucket of ice water will on average he's okay well on average our system is not based on average is like that it's those people that are at risk and get very sick and their their costs are much higher and that the burden that's placed on the people that yeah that's not so you can get cancer never smoked in your life it's just saying that we're looking at everything and as a risk management thing is that's all insurances anyway so please take a look at these numbers again I'm hoping the consultant that euros hiring to do the same thing but I'm really concerned about eliminating that not just because I think it's unfair but I think it goes a long way toward kicking can down the road not solving the problem any response. One comment that I would have a uses on its service with those were recommendations that were proposed previously and evaluated by the the previous board of we're going to be looking at those in each and every one of those proposals I'm not here to tell you we will accept it or or rejected but we are going to look at them and then we'll make a recommendation to this book body in this body will also have the ability to accept or reject any of our proposals so I think that the quote of the it's a very pertinent discussion it may be premature because we haven't made the decision today but I appreciate the input okay and I think you heard me Mr secretary thank you very much thank college thank you Mr chairman. Senator Tucker and then rip Senator Hickey. Thank you Mr I'll be brief your senate just for a resident want that. The public school employees got a raise but that rates may go away because of the increase in health insurance and we're also discussing proposed increases for state employees and I'm curious about any merit pay increase on on that side with the president that under consideration. So one of the things we've talked about doing it and then we One representative wooden's comments you know we have an integrated the process of paying for health insurance and how we how we cover that within the budgeting process maybe this is just me being the budget guy and everything is a budget issue. But I'd like to integrate it within the budget process at the same time that we look at things like employee raises so that we can consider those two in conjunction with one another so that we don't give with one hand and take away with the other necessarily but instead can hopefully say to people more years than not you are getting ahead. Senator Hickey is recognized thank you Mr maybe I shoulda jumped in earlier members today was supposed to be for informational purposes just to let you know how bad that the things are in the situation that were that were in with these with these plans the. We're gonna have a lot of decisions that are gonna have to come before us here in the next month two months three months in regards to this and we knew that these questions would come out so that's the reason we wanted to go ahead and get this preliminary information out to you also that you would know those recommendations is as most of you have heard although I still have people asking me those recommendations that they have those were made by that EBT Board what you dissolve during the session so just. At this point we like to say that everything everything is on the table in regards in regards to where that's at because right now the state board of finance on a temporary basis has that authority because we knew that those recommendations would not even get us back to back to hold for a lack of a better word we were still going to be in a deficit even with those. What's going to have to happen of course is we're going to probably have to put money into this plan premiums are going to have to increase and there's going to have to be legislation to correct some of this what you've also done to the executive committee in its in your policy report today is we did hire we did hire a consultant what you've heard about which is called Segal and what we've done is we've asked them to look at a variety of things representative we've not heard some years they're going to they're supposed to look at those also but they're supposed to look at things on a long term basis to keep us from from this from happening again such as the center Hendren and brought up we want to figure out how how that we're going to stop that we're gonna have to figure a new long term governance for the plan so it won't be under the state state board of finance possibly unless they decide they want to keep it after this but probably triggers that would come into place of for some of you say that so that those triggers that or would come into place you know if if we're not cash flowing if right cash flowing that those triggers would automatically where the premiums would increase or that that would be brought to or that it will be brought before us on like a semi annual or quarterly basis so that we'll know what's going on you know over the over the long term we will have to put that in legislation for that to be done that's all part of the plan but again just kind of want to tell you all that have them to present today so that you're not blind sided with with what is coming in the in the next few months thank you Mr. Thank you senator I do have one question for Secretary of. Fletcher Did did you through all this working out are you know a voting member of the board of finance. I am representing the governor on the board of finance for this one particular issue anything else at the board reviews he has another designated but I'm is that designate for this issue through all the discussions we had prior to this move you one of the things we discussed was you are part of the the old board and you saw that you shouldn't be a part of the board so I just wondered why the decision for you to be that does in the on the board finance on this one decision. I want to speak for the governor but I believe it was more of just a historical knowledge of where we've gone last year and a half we since we've been on board and being able to educate the board of finance on what the former EBT Board had done and maybe some of their reasoning behind that. Okay thank you thank you guys does it no further questions for subject. So with that we'll move to J. and without objection one two and three will be referred to To the Committee said number one will go to House committee on aging children use number two to House committee on aging children youth and number three to the act committee house ag committee seeing no objection we are those are referred see no further business we stand adjourned.