Legislature(2021 - 2022)GRUENBERG 120
05/18/2021 03:00 PM House STATE AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB95 | |
| HB177 | |
| HB158 | |
| HB94 | |
| HB31 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 95 | TELECONFERENCED | |
| *+ | HB 158 | TELECONFERENCED | |
| *+ | HB 94 | TELECONFERENCED | |
| *+ | HB 31 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 177 | TELECONFERENCED | |
HB 94-PROHIBITED COMMERCIAL LEASE PROVISIONS
3:55:59 PM
CHAIR KREISS-TOMKINS announced that the next order of business
would be HOUSE BILL NO. 94, "An Act prohibiting the use of
certain restrictive provisions in leases of space for business
use in certain federally established zones; and adding an
unlawful act to the Alaska Unfair Trade Practices and Consumer
Protection Act."
3:56:21 PM
PAUL LABOLLE, Staff, Representative Neal Foster, Alaska State
Legislature, on behalf of Representative Foster, prime sponsor,
introduced HB 94. He paraphrased the sponsor statement
[included in the committee packet], which read as follows
[original punctuation provided]:
HB 94 adds a prohibitive lease provision to the list
of Unlawful Acts and Practices under Alaska's Unfair
Trade Practices and Consumer Protection Statute. This
new provision eliminates restrictive covenants in
leases of space for business use. The spirit of the
bill is to increase competition in Alaska. The bill
prohibits contract clauses that prevent or limit
either party's ability to participate in businesses
that compete with the other party. Many of Alaska's
businesses are small. When large companies contract
with these businesses they are able to leverage
unfavorable terms that are designed to limit
competition. HB 251 aims to prevent that and improve
competition in Alaska's economy. The measure would
apply in historically underutilized business zones
established by the United States Small Business
Administration under 15 U.S.C. 657a (HUBZone Act of
1997).
CHAIR KREISS-TOMKINS welcomed invited testimony.
3:57:30 PM
REPRESENTATIVE TARR requested an example to help her fully
understand the implications of the proposed legislation.
3:57:54 PM
NICK MOE, Azachorok Inc, provided a real-life example of the
noncompete clause that the bill would address, explaining that
Azachorok Inc was not allowed to sell similar items below the
high prices set by a company they are tied to by a commercial
lease agreement. He opined that HB 94 would encourage
competition in the free market, help drive down high prices, and
help local businesses. He urged the committee to support the
proposed legislation.
CHAIR KREISS-TOMKINS asked whether the company in question was
the Alaska Commercial Company.
MR. MOE confirmed.
4:01:59 PM
REPRESENTATIVE TARR gathered that if a village corporation was
leasing space for a small food store, their prices would have to
be based on the prices set by the "parent company" that they
lease from. She asked if that was correct.
MR. MOE answered yes, with a huge markup.
4:02:53 PM
REPRESENTATIVE KAUFMAN asked whether there was "some unfair
aspect" that could be an unintended consequence of the
legislation, such as a nonprofit selling goods that would
undercut a commercial operation simply because it was operating
as a nonprofit.
MR. LABOLLE said that was not the intent of the bill. He
offered to follow up with the requested information.
REPRESENTATIVE KAUFMAN, attempting to clarify his question,
asked whether the bill would assure equal opportunity in trade
if it were to pass.
CHAIR KREISS-TOMKINS asked Mr. Moe if he was aware of similar
situations in other communities.
MR. MOE said he had heard of this problem persisting everywhere
that the Alaska Commercial Company operates.
4:05:14 PM
REPRESENTATIVE CLAMAN asked whether the intent of the bill was
to make the treble damages provisions of the Deceptive Trade
Practices Act applicable in this instance.
MR. LABOLLE stated that the bill was drafted so it would apply
to any portion of the "unfair labor practices."
REPRESENTATIVE CLAMAN sought to confirm that Mr. Labolle was
referring to unfair trade practices.
MR. LABOLLE clarified, "'The unlawful acts and practices' under
Alaska's unfair trade practices and consumer protection
statutes."
4:05:53 PM
CHAIR KREISS-TOMKINS announced HB 94 was held over.