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Sponsor Statement for HB 123
Use of Bonuses Earned on State Travel

An Act relating to the use of frequent flyer miles or another bonus earned on travel paid for by the state.

The State of Alaska spent more than $15.7 million on employee transportation in the recent fiscal year. The public dollars spent on state business travel have been steadily trending upwards.

The State of Alaska presently has no policy regarding the utilization of mileage benefits accrued by state employees while on state business. House Bill 123 would require a state employee who accrues frequent flyer miles while on state travel to utilize any incentives received for future official state business travel. The incentives earned while on state funded travel are rightfully the property of the State of Alaska and should be utilized for the future benefit of the state.

This legislation has two purposes. First, to save the State of Alaska on travel expenses by utilizing travel awards earned by state employees on subsequent state travel. Second, travel agents have indicated state employees may not be selecting the least expensive carrier option when traveling on state business because they want to accrue frequent flyer miles on their preferred carrier.

HB 123 does not present any record keeping burden on state agencies or airlines. Instead, the onus is on the employee to comply with provisions of the legislation. Enforcement would be through the state ethics code as personal use of state accrued miles would be an inappropriate utilization of state resources for personal benefit.

The federal government requires frequent flyer miles accrued by federal employees on official travel to be utilized for the benefit of the federal government (See 41 CFR 310.53). However, the federal standard includes criminal sanctions and fines that are not present within HB 123. This legislation would make Alaska laws parallel the federal regulations without the burdensome paperwork and reporting requirements of the current federal standard. Many state governments, including the majority of western states, have implemented similar programs. HB 123 would be the least intrusive and troublesome standard applied.

The passage of HB 123 represents an effective tool to attain real cost savings to the State of Alaska without the creation of a expensive, burdensome program to realize those savings.

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