Legislature(2021 - 2022)BARNES 124
04/13/2021 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB163 | |
| HB137 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 137 | TELECONFERENCED | |
| *+ | HB 163 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 137-MOTOR VEHICLE OFFICES
8:36:43 AM
CO-CHAIR HANNAN announced that the final order of business would
be HOUSE BILL NO. 137, "An Act requiring the Department of
Administration to maintain and operate certain offices that
provide services related to motor vehicles; and providing for an
effective date." [Before the committee was CSHB 137(STA).]
8:36:52 AM
REPRESENTATIVE ZACK FIELDS, Alaska State Legislature, as prime
sponsor, presented HB 137, with the aid of a PowerPoint
presentation [hard copy included in the committee packet]. He
first talked about information shown on slides 2-4. He said
CSHB 137(STA) would require the Department of Administration
(DOA) to keep existing offices of the Division of Motor Vehicles
(DMV) open in communities of 850 people or more. He indicated
that although he supports the idea of the DMV exploring new
areas that may benefit from a new DMV office, that is beyond the
scope of the proposed legislation. He opined that DMV offices
provide a critical public service that allows commercial
transportation throughout the state by providing commercial
driver's licenses (CDLs).
REPRESENTATIVE FIELDS noted that [as shown on slide 5], there
are privatized offices contracted to provide some but not all of
the services available through a DMV office, but he said he
wants to ensure all services remain available in the communities
where they are currently offered, not only in larger
communities. He said this is an issue of equity. He named
services that can be provided only via the DMV: issuance of
driver's licenses; renewal of driver's licenses for seniors over
the age of 69; and issuance of CDLs. While, in theory, there
are other tests that can be done by privatized or other
providers, it can be less efficient and cost-effective for
Alaska consumers than getting those services through a DMV
office.
8:40:10 AM
REPRESENTATIVE FIELDS pointed to slide 6, which illustrates the
long distances people in various communities would have to drive
if their DMV offices were closed. As shown on slides 7 and 8,
he discussed the challenges of driving certain routes in Alaska,
such as the mountain pass to get out of Valdez, which can be
treacherous during winter. As covered on slide 9, he said not
everyone has access to Internet in Alaska. Slide 10 shows side-
by-side comparisons of the cost of services at a DMV office
versus via a private provider, illustrating that it is more
economical to purchase these services from the DMV.
Representative Fields opined it is unfair to take away the
ability of Alaskans to go to a DMV office, thus doubling the
cost of services.
8:43:28 AM
REPRESENTATIVE FIELDS, as shown on slide 11, stated that the DMV
pays for itself through its fees.
8:44:50 AM
REPRESENTATIVE PATKOTAK asked why the DMV field service
locations in downtown Anchorage and in Nome were shown on slide
11 as not available ("N/A") [in terms of revenue].
REPRESENTATIVE FIELDS deferred to Ms. Javier of the Legislative
Finance Division.
8:45:37 AM
SABRINA JAVIER, Fiscal Analyst, Legislative Finance Division,
explained that that was just information that "would not pull
up" when she ran an ad hoc report for the bill sponsor.
8:46:08 AM
REPRESENTATIVE MCCABE indicated he had found different results
on the numbers when including the "PCNs." He offered an
example. He said it appeared as though the statistics provided
by the bill sponsor show the DMV as "wildly profitable" while
according to what he sees - "not so much."
REPRESENTATIVE FIELDS deferred to Ms. Javier since she had
created the chart on slide 11.
8:47:39 AM
CO-CHAIR HANNAN told Ms. Javier that the committee would like to
know what fiscal year the data is from, and she noted that
Representative McCabe had pulled PCN data from that data.
8:47:52 AM
MS. JAVIER responded that when Representative McCabe's staff had
requested this data, she had pulled the personal services data
from the numbers. She offered her understanding that what
Representative McCabe had received were "just the amounts for
personal services" and "not the entire picture."
REPRESENTATIVE MCCABE observed [the three columns of the chart
on slide 11] were: "revenue," "expenditures and encumbrances,"
and "difference." He indicated that when he had asked for a
personal services category, it resulted in a significant
difference in profit or return. He offered his understanding
that the expenditures in the Delta office equated to five people
making $20,000 or less a year, and he said he thinks something
is wrong with the numbers.
CO-CHAIR HANNAN pointed out that Representative McCabe was
asking questions based on data he had received but which was not
in the committee's possession.
MS. JAVIER, in response to Co-Chair Hannan, recollected the data
she had procured for the bill sponsor was from fiscal year 2016
(FY 16) through FY 20. She clarified that these numbers are not
concrete, and she could get more concrete numbers from the
department. She clarified for Representative McCabe that the
numbers she had given him were only for personal services and
were not compared with the cost of revenues.
8:52:51 AM
REPRESENTATIVE HANNAN suggested having information on the
record. She asked whether the category of expenditures and
encumbrances, on the slide provided by Representative Fields,
would include personal services.
8:54:22 AM
The committee took a brief at-ease at 8:54 a.m.
8:54:59 AM
CO-CHAIR HANNAN announced that further clarification would be
sought regarding the data Representative McCabe possessed, and
then it would be presented to the entire committee.
8:55:11 AM
REPRESENTATIVE FIELDS returned to the PowerPoint and touched on
the topic on slide 12, which read as follows [original
punctuation provided]:
Shifting cost burdens deepen divides:
-Rural Alaska faces higher costs in healthcare,
gasoline, & fewer options for utilities such as
Internet.
-Driving 100+ miles (each way) for service is an
additional tax.
-Private DMV partners have no regulations or controls
over pricing for mandatory services. The Department
has method to control costs, fees, or additional
charges.
-For communities where a private partner were to be
the only option, residents must either pay up front or
through additional costs such as driving 70-100 miles
for key services.
-Internet is not always an option for everyone or
every service.
REPRESENTATIVE FIELDS, in conclusion of his presentation, drew
attention to the information on slide 13, which read as follows
[original punctuation provided]:
"In our poll, Seniors of Alaska found overwhelming
support amongst our members to support HB 137 and
retain affordable, safe options for Seniors in their
local communities. 96.5% overall favored keeping their
local DMV, and some locales had 100% of members
supported this critical public service for seniors."
-Seniors of Alaska
8:56:03 AM
REPRESENTATIVE PRAX asked Representative Fields to confirm
whether HB 137 would require all communities with populations
larger than 850 to have a DMV office.
REPRESENTATIVE FIELDS clarified it would be that those
communities of 850 or more, which currently have a DMV office,
retain those offices. He said the structure of the bill is
focused on equity.
REPRESENTATIVE PRAX noted that in terms of equity, there are
communities with that population threshold that do not have a
DMV office.
REPRESENTATIVE FIELDS said he supports the addition of DMV
locations and would be willing to work with Representative Prax
and consider an amendment to achieve this in a rational way.
8:58:08 AM
REPRESENTATIVE MCCABE observed that Yakutat, Glenn Allen, and
Anderson, Alaska have DMV offices currently and populations of
fewer than 850. He asked if the proposed legislation would
result in those offices being closed.
REPRESENTATIVE FIELDS answered that HB 137 does not direct the
department to close DMV offices at locations that are under any
certain population threshold, and the administration has not
proposed closing those DMV offices. He said the committee could
decide to lower the threshold to 300; all that matters is that
the threshold is consistent, he purported. He explained he had
chosen the number 850 to keep the DMV offices open that were
under threat of closure.
REPRESENTATIVE MCCABE offered his understanding that the
outgoing commissioner had recommended not closing down the DMV
offices. He said he received a call from a constituent, who
runs a facility in Palmer, Alaska, that issues CDLs, who is
concerned the proposed legislation would prevent him/her from
doing that. He said vehicle transfers and permanent
registrations do not need to be done at the DMV. Out of about a
dozen reasons to go to a DMV office, he offered his
understanding that only about 5 of them require the DMV office
visit. He said the bill seems to be anti-private business, and
he said it seems to him a bad idea to tie the hands of the
administration in how it must do business.
9:01:38 AM
REPRESENTATIVE FIELDS responded that he does not believe HB 137
would hurt "UMVs." He noted in his district there is a DMV and
multiple UMVs, which are more convenient for some people. He
said he supports people having the choice. In response to Co-
Chair Hannan, he said while he does not know what the initials
in "UMV" stand for, it is a private partner that contracts with
the DMV to provide certain services. He suggested his staff
might know what each letter represents. He explained he had
listed that which only the UMV provide, in terms of services.
9:02:58 AM
TRISTAN WALSH, Staff, Representative Zack Fields, Alaska State
Legislature, explained that UMV is just a name for the largest
contractor with the DMV; there are other contractors.
REPRESENTATIVE FIELDS noted that Representative McCabe had
questioned the necessity of this legislation given the
legislature had addressed this issue in its budget process. He
said there have been other issues where there is an
administrative proposal, a legislative response, and things get
"ironed out in one of several ways." He gave examples. He said
with the exit of the last commissioner and the current
administrative stance on the DMV issue, he feels HB 137 should
continue to be advanced to protect public services.
9:05:34 AM
REPRESENTATIVE MCCABE asked whether one of the reasons for HB
137 is to protect jobs.
REPRESENTATIVE FIELDS replied that he had mentioned jobs in
terms of people driving to and from work as it relates to
locations of DMV offices.
REPRESENTATIVE MCCABE recollected hearing a pharmacist testify
before the previous committee of referral that he was more
qualified to give an eye test than was someone at the DMV.
REPRESENTATIVE FIELDS pointed out that if a DMV is eliminated
from a community that does not offer another means to obtain an
eye test, then the person may have to find a different way to
get the test, and that alternative may be more expensive.
9:07:50 AM
MR. WALSH added that the Department of Labor & Workforce
Development (DLWD) had estimated the cost of an eye test [from
an medical doctor] was approximately $230.
REPRESENTATIVE FIELDS reiterated the advantages of getting
services from the DMV.
9:08:25 AM
CO-CHAIR SCHRAGE said he supports the intent of the bill to
retain access to DMV services for seniors, Alaskans in rural
communities, and others but expressed concern about the fiscal
note. He read [the first sentence of the fiscal analysis from
the fiscal note with identifier HB 137-DOA-DMV-4-8-21, included
in the committee packet], which read as follows:
This bill removes the ability to close a State
operated Division of Motor Vehicles (DMV) office in
communities that have 850 or more citizens
irrespective of need, economic conditions, demand for
services, facility considerations, cost to the state,
staffing provisions, technological advances, changes
to the industry, or other unforeseen conditions.
CO-CHAIR SCHRAGE said he worries the proposed legislation would
put restraints on DOA irrespective of changes that might occur
in the next five to ten years. He asked the bill sponsor to
comment.
REPRESENTATIVE FIELDS responded that he thinks the fiscal note
is unusual. He explained that HB 137 would maintain existing
services of the DMV; therefore, the fiscal note should be zero.
He offered his understanding that the administration looked at
not closing facilities as resulting in an increase in costs. He
stated, "It's just not the way we've ever done fiscal notes
before." He said another issue is to ask to what extent the
legislature should weigh in on public services and to what
extent it should "leave it to the agency." He said his general
approach is to leave things to the agency unless it proposes
something with which the legislature does not agree. He said he
does not agree that it is reasonable to close any of the DMVs
the administration proposed for closure; therefore, he looked
for a way to preserve public services without micromanaging the
department. He acknowledged that change would happen in the
future but encouraged legislating now while recognizing issues
will need to be addressed again in the future.
9:11:59 AM
REPRESENTATIVE PRAX specified that "the people" pay for the DMV.
He asked if the DMV fees are intended to cover just the cost of
issuing "the license or the certificates or whatever."
REPRESENTATIVE FIELDS remarked that numbers show the DMV "more
than pays for itself over the years"; therefore, it would be
reasonable to question whether fees could be lowered. However,
he deferred to the department to answer whether it is the
mission of the department to cover costs or return money to the
state.
REPRESENTATIVE PRAX suggested the increase in electronic
transactions "would reduce the demand for a physical presence at
the office." He reasoned that in that case, the services
offered could take place in any state agency office. He said
[HB 137] seems overly constricting.
REPRESENTATIVE FIELDS noted that the proposed bill would allow
flexibility to make transactions through other offices or local
government.
9:14:56 AM
REPRESENTATIVE DRUMMOND derived from the aforementioned fiscal
note that the DMV currently contributes to the state's general
fund (GF), and passage of HB 137 would result in "a decrease of
DMV's contribution to the general fund." She asked if
ordinarily the fiscal note gets "argued out" by the House
Finance Committee [when it is the last committee of referral].
REPRESENTATIVE FIELDS responded yes.
9:16:09 AM
CO-CHAIR HANNAN announced the committee would hear invited
testimony.
9:16:19 AM
PETER ZUYUS, Executive Director, Seniors of Alaska, testified in
support of HB 137. He said Seniors of Alaska has expressed its
concern about the negative effects that closure of DMV office
locations will have on the following populations: seniors,
disabled, rural, lower income, and Native Alaskans. He noted
that a House Finance subcommittee voted unanimously to restore
budgets cuts proposed by DOA that would have cut the following
DMV office locations: Homer, Delta Junction, Valdez, Eagle
River, Tok, and Haines. He pointed out that although restored
in the FY 22 budget, these locations still could be closed at
will by the department. He said HB 137 would remove the ability
for arbitrary closure and restore legislative approval for any
rural state DMV office closure. He expressed that the rural DMV
office is a core service, and the proposed legislation would
keep that service intact.
MR. ZUYUS highlighted that HB 137 does not mention private
partnership awards; it gives legislative authority to oversee
any potential closure; closure of a rural DMV could occur with
legislative approval. He said private partnerships increase
costs of services. He warned that closure of rural DMVs could
leave the state vulnerable to multi-million dollar federal
lawsuit action for violation of the federal Elder Justice Act of
2010. He said the former commissioner of DOA had testified that
the proposed closures were selected because rural residents
would cause the least backlash and the communities were
lucrative for private partnership. He said there was no mention
of the negative economic impact to those communities that
closures would create. He noted there have been three DOA
commissioners in the last three years, which has not provided
stability for rural communities that count on their local DMV
for state services. He said HB 137 would remove arbitrary
decisions made by unelected state workers - decisions that could
affect rural Alaska communities; it is a nonpartisan bill that
would help all Alaska communities.
9:20:14 AM
MR. ZUYUS, in response to Representative McCabe, offered
information about Seniors of Alaska. He said it is a 501(c)(4)
organization with a viewership of 7,000.
9:22:50 AM
NONA SAFRA, testified in support of HB 137. She noted that
although she has a role as advocate for seniors and those with
disabilities, her testimony today is as an Alaska elder. She
said closure of DMVs in rural Alaska would leave many who are
mandated to appear at DMVs in person paying unregulated
arbitrary "convenience fees" at privatized offices [contracted
through the DMV] over and above the regulated state fees. She
said the commissioner's authority to close DMVs at will does not
best represent Alaskans as it is based on quantitative, not
qualitative, data.
MS. SAFRA shared her experience as a caregiver for elders who
require a Real ID to travel to the Lower 48 for medical care,
either driving hundreds of miles in bad conditions to get to the
closest DMV or suffering the financial burden of paying higher
fees at a contracted UMV. In terms of technology being a
solution, she noted that many of the 238,000 Alaskans in rural
areas have broadband issues, lack Internet connectivity, and may
not have the computers, e-mail addresses, or credit cards
necessary to complete on-line transactions and create electronic
signatures. Ms. Safra asked legislators to represent all
constituents by passing HB 137 to ensure access for all to meet
state mandated DMV requirements.
9:27:12 AM
JOE MICHEL, Executive Director, Alaska Trucking Association,
thanked the bill sponsor for clarifying under CSHB 137(STA) the
relationship that private partners have with the DMV. He
explained that he was wearing two hats: one was as a private
partner with the DMV and as a representative of the commercial
operators that would be affected by DMV closures. He said the
Alaska Trucking Association (ATA) is concerned about the ability
of its rural operators to comply with the regulations that
federal agencies put on the industry, and that that ability
would be affected by the DMV closures. He offered to answer
questions from the committee.
9:28:46 AM
REPRESENTATIVE MCCABE asked Mr. Michel to expound the federal
regulations for which he uses the DMV to comply.
MR. MICHEL answered the requirements of registration, which are
more complex for commercial drivers.
REPRESENTATIVE MCCABE said he has registered a commercial
vehicle and does not recall having to go physically to a DMV
office.
MR. MICHEL indicated that DMV transactions are done at ATA, and
there are two additional pieces of paper that are submitted to
the DMV. He mentioned "getting plates that fall off of
vehicles" being more easily done by going into a DMV office
rather than waiting 6-8 weeks to receive them in the mail. He
expressed the main concern is that avenues be left open for the
trucking industry to be able to comply with the regulations. He
concluded, "Now that the bill clarifies the private partnership
versus the DMVs, we're happy that ... there's as many options
available for our industry to comply with the regulations that
are placed on us."
9:32:34 AM
CO-CHAIR HANNAN opened public testimony on HB 137. After
ascertaining that there was no one who wished to testify, she
closed public testimony.
9:33:12 AM
REPRESENTATIVE PRAX requested that the director of the DMV
describe the services related to commercial vehicles that are
provided by the DMV offices and the measure of inconvenience
that would result from the smaller offices being closed.
JEFFREY SCHMITZ, Director, Division of Motor Vehicles,
Department of Administration, said he could provide a list for
the committee.
9:34:02 AM
CO-CHAIR HANNAN asked what services are available through the
variety of private contracted partners. She said she had heard
that some cannot provide CDLs while others can.
MR. SCHMITZ said he could include that information in the
forthcoming list.
CO-CHAIR HANNAN asked whether the DMV is expecting an uptick in
REAL ID applications.
MR. SCHMITZ replied that the short answer is yes, particularly
because it is within six months of the October 1 deadline. He
noted that 200,000 Alaskans have already obtained their REAL
IDs.
9:37:48 AM
REPRESENTATIVE PRAX asked whether the DMV is the only authorized
issuer of REAL IDs.
MR. SCHMITZ answered that all of the DMV's third-party providers
can issue REAL IDs.
9:39:02 AM
REPRESENTATIVE MCCARTY asked a series of questions related to
the REAL ID and the federal passport.
MR. SCHMITZ, in response to Representative McCarty, said the
REAL ID is a federal mandate, the deadline for which is
currently October 1, 2021, although having been delayed a few
times already, it could be delayed again. He said the U.S. Post
Office, while offering U.S. passports, cannot issue REAL IDs.
He confirmed that if a DMV were shut down, a U.S. Post Office
could provide a federally compliant passport, which would allow
its official carrier to board a plane, for example, although it
is not a REAL ID.
REPRESENTATIVE FIELDS clarified for Representative McCarty that
not all U.S. Post Offices issue passports. He said the DMV has
mapped out where all the passport-issuing U.S. Post Office
facilities are in Alaska, as well as where all the DMV offices
are located. He said this information could be provided to the
committee.
9:41:59 AM
CO-CHAIR HANNAN remarked that while both the REAL ID and U.S.
passport are federally compliant, it may be easier for someone
who does not already have a driver's license to obtain a
passport than to get a REAL ID.
9:43:14 AM
MR. SCHMITZ distinguished the difference between a REAL ID
driver's license and identification card - both federally
compliant under the REAL ID Act.
9:43:44 AM
CO-CHAIR HANNAN thanked the sponsor and testifiers.
[HB 137 was held over.]