Legislature(1997 - 1998)
04/08/1997 01:40 PM House FIN
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* first hearing in first committee of referral
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HOUSE BILL 50
"An Act relating to the use of broadcasting to promote
or conduct certain classics or sweepstakes; and
providing for an effective date."
REPRESENTATIVE MARK HODGINS explained that HB 50 would amend
AS 05.15.640 by removing the prohibition on broadcast
advertising for the legislatively identified classics as per
statute. At present the only classics that are allowed to
use broadcasting for promotion are fishing derbies. To
provide an advertising vehicle will assist these
organizations to increase public awareness of their events.
Representative Martin noted his concern in opening the door
to "gambling". He questioned how the proposed
classification had been chosen. Representative Hodgins
replied that the proposed groups are the only non-profits in
the State established legislatively.
Co-Chair Therriault pointed out that this year, the Iditarod
had lost money which they attribute to not being able to
advertise the race. He inquired if they were the ones who
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had requested the legislation. Mr. Hodgins noted that he
had been working most closely with the Kenai Chamber of
Commerce based upon their concern for the local Snow Goose
Classic race. These groups can not advertise their events,
curtailing public knowledge of ticket availability. At this
time, the only legal advertising which can be done, is
through broadcast media news stories. Advertising by
statute only provides that the organization receive 5% of
the revenue generated. Co-Chair Hanley questioned where in
statute the 5% reference occurred.
DENNIS POSHARD, DIRECTOR, CHARITABLE GAMING DIVISION,
DEPARTMENT OF REVENUE, responded that there is no 5% percent
budget limit requirement on advertising with regard to
gaming statutes. He pointed out that he could not speak to
other statutes which may exist.
Co-Chair Hanley asked if these organizations had been
allowed to advertise through print media only and not
through broadcast. Mr. Poshard stated that this restriction
would apply to all charitable gaming activities and would
only be applied to the use of broadcasting as defined in
statute. The restriction is on the use of broadcasting to
"promote" or "conduct" the use of charitable gaming
activities.
Representative Hodgins explained his understanding of the
difference between "conducting" and "promoting" activities.
The intent of HB 50 is solely for advertising. Mr. Poshard
emphasized that the bill would continue to prohibit the use
of broadcasting to promote or conduct bingo, pull-tabs,
raffles, lotteries and contests of skill. The only games
which would become open would be the classics and dog
mushing contests.
Mr. Poshard pointed out that those types of activities
account for less than 1% of the total charitable gaming pie.
Dog mushing is not a major part of charitable gaming
activities. The ice classics are small, although returns a
higher percentage of gross than other activity types.
Co-Chair Therriault asked if there would be a problem with
deleting "or conduct", on Page 1, Line 6. He thought that
deletion would clarify that broadcasting would be used only
to "promote". Representative Hodgins commented that he
would support that change. Mr. Poshard indicated that the
Department objected to the change, unless language was added
prohibiting the conduct of gaming over the airwaves.
Removing that language would remove the prohibition on
conducting. Co-Chair Therriault pointed out that concern
had been clarified on Page 1, Line 14. Mr. Poshard agreed.
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Co-Chair Therriault MOVED Amendment #1 which would delete
"or conduct", reiterating that the change would allow the
"promotion" of the classics without the "conducting". Co-
Chair Hanley pointed out conflict with the reference on Page
2, Section (b), should that language be deleted.
Representative Hodgins explained that the entire list of
designated non-profits indicated in the sponsor statement
were not all in operation at this time. Representative J.
Davies concurred that problems would result with the
proposed language change.
Representative Kelly referenced language on Page 2, Line 4,
in which "cable" is used for a distribution method. Co-
Chair Therriault WITHDREW the MOTION to adopt Amendment #1.
He suggested that changes to Section (b) would not be for
the promotion of the fish derbies but rather would provide a
means to conduct the fish derbies.
Mr. Poshard clarified the intent of the House State Affairs
committee substitute. A deletion to the group using
broadcasting to promote fish derbies, would remove the
exemption from the prohibition, in which broadcasting would
then no longer be used to promote the derbies. Section (a)
of the bill allows promotion or conducting of all the
classic contests.
Co-Chair Therriault inquired if there would be a problem in
deleting the language on Page 1, Line 6. Mr. Poshard could
not foresee a problem with that change.
Discussion followed between Mr. Poshard and Representative
Kelly regarding broadcasting to promote charitable gaming
activities and the use of cable lines. Representative
Hodgins pointed out that Section (a) allows the broadcast of
various activities. A group may not use broadcasting to
promote or conduct any other activities other than the ones
listed. There is no prohibition on cable. Mr. Poshard
emphasized, currently, an organization is not allowed to use
any broadcast means to conduct charitable gaming other than
the exemption for non-commercial. Under the proposed
legislation, a group would be able to use commercial, non-
commercial or cable to promote or conduct a charitable
gaming activity.
Mr. Poshard explained his personal distinction between
conducting and promoting over the airwaves. Conducting
would be using the airwaves to conduct the activity;
whereas, announcing a winner or having a live broadcast at a
fish derby weigh-in would merely be promoting. Mr. Poshard
pointed out that auctions are not gaming activities.
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(Tape Change HFC 97-89, Side 2).
Representative Martin asked if the drawing of a winning
ticket on television would be promoting or conducting. Mr.
Poshard stated that he felt that would be promoting. For
the use of the broadcast media to consider conducting would
involve the participants in that media.
Mr. Poshard spoke to the fiscal note. He pointed out that
currently in Alaska, there exists a limited number of
organizations which could qualify to participate in this
type of activity. The Department does not anticipate that
there will be much more work generated since the activities
must be authorized by statute. Violation of any action
could place the permit in jeopardy, creating a natural
monitor.
Co-Chair Hanley asked if there was a limit attached to the
profit received for classics. Mr. Poshard replied that $1
million dollars could be awarded in prizes annually for all
charitable gaming activities except bingo which has a $840
thousand dollar limit.
Co-Chair Therriault MOVED to delete "or conduct", Page 1,
Line 6. Representative Foster OBJECTED.
A roll call vote was taken on the MOTION.
IN FAVOR: Moses, Kelly, Martin, Therriault, Hanley
OPPOSED: J. Davies, G. Davis, Grussendorf
Representatives Mulder, Foster and Kohring were not present
for the meeting.
The MOTION PASSED (5-3).
Co-Chair Hanley suggested that the legislation would provide
an advantage to the classics. He thought that advantage
could result in other groups "pushing" for legislative
designation in order to take advantage of such advertising.
Representative Martin voiced his concern with passage of the
legislation. He reiterated that action would provide
"openings" for more gambling in the State.
Representative Foster MOVED to report CS HB 50 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal note. Representative Martin OBJECTED.
A roll call vote was taken on the MOTION.
IN FAVOR: J. Davies, G. Davis, Grussendorf,
Foster, Moses, Therriault
OPPOSED: Kelly, Martin, Hanley
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Representatives Mulder and Kohring were not present for the
vote.
The MOTION PASSED (6-3).
CS HB 50 (FIN) was reported out of Committee with
"individual recommendations" and with the fiscal note by the
Department of Revenue dated 2/21/97.
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