Legislature(2021 - 2022)GRUENBERG 120
03/30/2021 03:00 PM House STATE AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB137 | |
| HB63 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 137 | TELECONFERENCED | |
| + | HB 63 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 137-MOTOR VEHICLE OFFICES
3:05:13 PM
CHAIR KREISS-TOMKINS announced that the first 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."
3:05:31 PM
REPRESENTATIVE CLAMAN moved to adopt the proposed committee
substitute (CS) for HB 137, labeled 32-LS0650\B,
Bullard/Dunmire, 3/29/21, as the working document.
CHAIR KREISS-TOMKINS objected for the purpose of discussion. He
asked how the CS differs from the original version of the bill.
3:06:02 PM
TRISTAN WALSH, Staff, Representative Zack Fields, Alaska State
Legislature, stated that the CS, Version B, corrects an
inadvertent drafting error, which would preclude public
partnerships that may exist in the future.
CHAIR KREISS-TOMKINS removed his objection to the adoption of
Version B. Without further objection, CSHB 137, Version 32-
LS0650\B, Bullard/Dunmire, 3/29/21, was adopted as the working
document.
3:06:33 PM
REPRESENTATIVE ZACK FIELDS, Alaska State Legislature, prime
sponsor, explained that the bill keeps existing Division of
Motor Vehicle (DMV) offices open throughout the state. He noted
that the Department of Administration (DOA) proposed closing DMV
offices in six communities, which would result in Alaskans
either taking long trips or paying more to access essential
services. He said HB 137 is written to keep DMV offices open in
communities with a population of 860 persons or more, [including
the six proposed location closures: Tok, Haines, Valdez, Eagle
River, Homer, and Delta Junction].
3:07:29 PM
REPRESENTATIVE FIELDS provided a PowerPoint presentation, titled
"HB 137." He began on slide 3, titled "DMV: Critical Public
Service," which read as follows [original punctuation provided]:
-Per the US Census, 68% of Alaskans drove alone to
work in 2017.
-Per the same data, 83-85% of commuters use personal
vehicles in the Mat-Su borough.
-In Fairbanks, this rises to 90% of commuters.
-DMV services are critical to safe passage of commuter
and commercial traffic.
-Trucking amounts to 70% of the commercial freight
delivery of goods in the United States.
REPRESENTATIVE FIELDS continued to slide 4, titled "Commercial
Traffic: arteries of local economies," which indicated that in
2017, DMVs helped ensure safe passage of approximately $9.5
billion worth of commercial goods via commercial trucks in
Alaska. Additionally, entry into the state is key for
commercial freight on Al-Can Highway.
3:09:46 PM
REPRESENTATIVE FIELDS progressed to slide 5, titled "What does
the DMV do?" The slide read as follows [original punctuation
provided]:
-The DMV conducts many services that are important to
residents [sic] daily lives.
-Many services must be conducted in person. Many are
statutory.
-Private operators are not required to, and cannot
conduct, all the services the DMV offers, and requires
for various residents.
-Private operators first responsibility is to
shareholders or owners, not to public.
REPRESENTATIVE FIELDS noted that while some functions can be
outsourced at a higher price, other functions cannot be offered
through private facilities. He said it's not his intention to
restrict entrepreneurs from opening private facilities that
offer some DMV services; however, he reiterated that there are
certain services that only the DMV offers. He pointed out that
DMVs do not cost money to the state of Alaska, as the offices
recoup the costs in fees. He emphasized the efficiency of the
DMV fee structure.
REPRESENTATIVE FIELDS advanced to slide 6, titled "Few
alternatives," which read as follows [original punctuation
provided]:
-Average drive to other DMVS:
-TOK-DJ: 1 hr 41 min each way. (214 miles)
-DJ-Fbnks: 1 hr 40 min each way. (190 miles)
-Tok-Glennallen: 2 hr 40 min each way. (240 miles)
-Haines-Juneau: 4 hr ferry ride each way. (185 miles)
-Homer-Soldotna: 1.5 hr each way. (149.6 [miles])
REPRESENTATIVE FIELDS questioned why a service funded by fees
would be shutdown, which would consequently inconvenience
Alaskans and prohibit commerce. He proceeded to images of
Thompson Pass on slide 7 and images of Delta Junction and the
Swan Lake fire on slide 8, indicating that roads in Alaska are
unpredictable due to weather, avalanches, flooding, and fire.
3:13:51 PM
REPRESENTATIVE FIELDS continued to slide 9, titled "Internet
options aren't available for everyone," which read as follows
[original punctuation provided]:
-Internet options aren't available for all services,
including REAL ID, drivers knowledge test, vision
test, CDL services.
-Even in communities on the road system, average cost
of internet can be prohibitively expensive. Service is
not necessarily guaranteed. Internet options can also
be difficult for Seniors: an estimated 105,000
Alaskans over the age of 60 are still driving.
-AK DMV is required to provide certain services in
person. Original license, 2nd license renewal, and Sr
Citizen Driver License Renewal.
- Knowledge testing, Drivers License reinstatement are
not able to be done online.
-Eastern Interior Alaska: 25.1% households do not have
internet.
-Eastern Southcentral Alaska: 18% of households do not
have internet.
-In the Southern Kenai Peninsula, 18% of households do
not have internet.
-In Haines, 14% of households do not have internet.
-Up to 30% of Seniors do not have internet access.
REPRESENTATIVE FIELDS said the administration had suggested that
people go to doctors for vision tests instead of the DMV. He
deferred to Mr. Walsh for an explanation of why that is not a
viable alternative.
MR. WALSH explained that doctors are not a viable alternative
because vision tests, especially for those over age 69, are not
easily available on a senior's insurance plan. He noted that
after the presentation, an "expert witness" would speak to the
challenges that some seniors face.
3:15:38 PM
REPRESENTATIVE FIELDS resumed the presentation on slide 10,
titled "Increased Costs: public pays more for same service." He
acknowledged that some functions can be accomplished through
private vendors albeit at a much higher price. He stated that
he has no issue with private vendors complementing DMVs, but not
replacing them. He progressed to slide 11, titled "The DMV pays
for itself," which read as follows [original punctuation
provided]:
-The DMV is a division in the State that pays for
itself.
-Each of the six proposed location closures was
revenue positive for the state; last year and the
previous 5 years.
-Closing or privatizing them only serves to pass
increased costs and fewer services to residents.
-There is no corresponding increase in service; only
cost.
REPRESETATIVE FIELDS added that he didn't accept the premise
that a rural DMV office should be shut down because it didn't
pay for itself. Nonetheless, he pointed out that [each of the
six proposed location closures] were revenue positive.
3:17:38 PM
REPRESENTATIVE FIELDS advanced to slide 12, titled "Shifting
cost burdens deepen divides," which read as follows [original
punctuation provided]:
-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.
3:18:05 PM
REPRESENTATIVE FIELDS continued to slide 14, titled "Seniors or
Alaska," 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
REPRESENTATIVE FIELDS acknowledged the importance of keeping
senior citizens connected to family members, loved ones, and
friends. He added that in Alaska, staying connected in most
communities is contingent on the ability to drive. He conveyed
that in addition to economic considerations, [driving] is
important to people's mental health and the ability to maintain
social connections.
3:18:48 PM
CHAIR KREISS-TOMKINS opened invited testimony.
3:19:23 PM
PETER ZUYUS, President/Executive Director, Seniors of Alaska,
expressed support for HB 137. He recalled that DOA was
proposing to close six DMV offices in communities across rural
Alaska, which would have left them without a DMV or only a
private DMV that would charge higher, arbitrary fees. He shared
his understanding that HB 137 would recognize the needs of rural
communities and their reliance on the state DMV. He said the
DMV is an integral part of many rural communities, adding that
office closures would limit access to essential services for
Alaska's senior, disabled, rural, lower-income, and Native
residents. Furthermore, he opined that the private
partnerships' convenience fee structure presents an "economic
and discriminatory hardship" on seniors and other community
members. He offered the example of seniors in Valdez who would
have been forced to pay at least twice as much for mandated
state services as seniors in other areas of the state. He
recalled that the idea [to close six DMV offices] was
unanimously rejected by the House Finance Subcommittee; however,
he expressed concern that DOA would continue with its proposal
regardless of the legislature's intent. He said HB 37 would
address that issue by affording protections to DMV offices in
rural communities. He reiterated that closing the only DMV
office communities would force residents to drive hundreds of
miles to obtain essential services; further, residents would be
at the mercy of unregulated convenience fees. He maintained
that DMV closures would subject senior citizens to a number of
negative impacts and discriminatory practices, including
unnecessary travel. He urged the legislature to "vote yes" on
HB 137 to protect Alaska's seniors and rural communities from
"unfiltered, discriminatory, or cold data-point driven actions."
3:27:45 PM
CHAIR KREISS-TOMKINS invited questions from the committee.
3:28:04 PM
REPRESENTATIVE EASTMAN asked how the bill sponsor decided upon
the number 850 for the population threshold.
REPRESENTATIVE FIELDS explained that [the legislature] is
prohibited from doing local and specific legislation.
Therefore, he stated his belief that establishing a reasonable
and consistent statewide population threshold was necessary to
determine which communities should have basic services, such as
a DMV office. He said he considered where DMVs have operated
historically, where they seem to have broad support, and where
there is a need. He also contemplated community size and the
state's population distribution. He stated that 850 is a best
guess for a "fairly large" rural community in Alaska.
Additionally, a threshold of 850 has the effect of protecting
all existing DMVs.
REPRESENTATIVE EASTMAN pointed out that there are a number of
communities in his district [District 10] that meet the
threshold of 850; nonetheless, District 10 does not have a DMV
office. He expressed concern that if the bill were to pass, his
constituents would feel deprived of that opportunity.
REPRESENTATIVE FIELDS clarified that the bill does not prohibit
the state from opening additional DMVs. Additionally, it does
not prohibit private, complementary services from being
provided. He acknowledged that as the valley grows, there could
be a need to have multiple DMV offices in Wasilla and Palmer,
which the bill would permit but not require.
3:30:58 PM
REPRESENTATIVE VANCE offered her understanding that as it's
currently written, the bill prohibits any future contracts with
private partnerships for DMV services. She asked if that is
correct.
REPRESENTATIVE FIELDS stated that it doesn't prohibit future
private partnerships. He clarified that the bill requires that
DMV offices remain open in those communities where they already
exist. He reiterated that should CSHB 137(STA) pass, it would
not prohibit entrepreneurs from opening additional private
services. Further, he emphasized his interest in protecting
access to essential public services.
MR. WALSH added that the current language does not preclude the
renewal of existing contracts; therefore, current [private]
partnerships could continue to renew those contracts.
REPRESENTATIVE VANCE expressed concern that per the bill
language, private sector partnerships would not be allowed. She
opined that they have provided a "great" service in Alaska's
communities. She asked how many private partnerships currently
exist across the state.
REPRESENTATIVE FIELDS said he has heard of private partnerships
in many communities. He assured Representative Vance that when
submitting the drafting request to Legislative Legal Services,
he clearly communicated that the purpose was to preserve
existing public DMVs while continuing to allow private sector
operators to exist. He stated his belief that the bill is
drafted to meet that intent.
MR. WALSH in response to Representative Vance, approximated that
there are currently 15 private partners in the state.
3:34:11 PM
REPRESENTATIVE VANCE shared her understanding that the bill's
current language would not provide a "grandfather statute" to
contracted services. She surmised that if those contracts
ended, the state would be obligated to provide those services in
small communities, which would create a large fiscal note. She
said she is struggling to see the need for this legislation, as
[the House Finance Subcommittee's] votes against closing the six
DMV offices clarified the legislature's view. She opined that
this legislation would limit [the legislature's] ability to
assess the state's needs and provide the most efficient
government.
REPRESENTATIVE FIELDS reiterated that the bill would not require
the closure of any private DMVs or prohibit their renewal. He
emphasized that CSHB 137(STA) would protect DMVs in communities
where they already exist based on a population threshold of 850.
He expressed confidence that the bill as it's currently written,
meets that intent. Regarding the need for the bill, he recalled
that the former commissioner [Kelly Tshibaka] said she would not
be closing DMVs pending input from the legislature; however, he
informed the committee of an email he received from the mayor of
Homer. The email detailed the recent closure of the community's
local DMV office, which illustrates that the commissioner "said
one thing and did another." He opined that it's preposterous to
suggest that a community as large as Homer should not have a
local DMV.
REPRESENTATIVE VANCE asked if Representative Fields had inquired
as to the reason that the Homer DMV office was closed.
REPRESENTATIVE FIELDS remarked:
I think the commissioner made it pretty clear that she
wanted to close down these six DMVs. She falsely
stated that they cost money - they don't. They're
revenue positive. And that was the Department of
Administration's stated reason.
3:37:23 PM
REPRESENTATIVE CLAMAN questioned whether larger communities,
such as Juneau, Anchorage, and Fairbanks, have only one DMV
office.
REPRESENTATIVE FIELDS clarified that the Municipality of
Anchorage has multiple [DMV offices]; however, he stated his
understanding that "the core" of Anchorage, midtown, only has
one DMV.
MR. WALSH said in the larger "metropolitan" areas in Alaska,
there is typically one state-run DMV, as well as one or two
private partners.
REPRESENTATIVE FIELDS said "community" in this bill is clearly
written to differentiate the community of Eagle River from the
community of Anchorage because it is important for that local
community to have a DMV. He said in drafting with Legislative
Legal Services, he communicated that his intent was not for DOA
to construe this as an allowance for only one DMV in Anchorage.
He clarified that "it's by community."
REPRESENTATIVE CLAMAN sought verification that the intent of the
bill, specific to the Anchorage and Eagle River example, is that
the DMV would have to keep both offices in those locations open
indefinitely.
REPRESENTATIVE FIELDS confirmed.
3:39:26 PM
REPRESENTATIVE KAUFMAN referring to the date in Section 1 of the
bill, questioned what would happen if an event caused [a
community's] population to decline.
REPRESENTATIVE FIELDS conveyed that his intention of setting a
population threshold was that in an event that caused a
community's population to sharply decline, the department would
have the ability to close the DMV office in that location.
REPRESENTATIVE KAUFMAN expressed his continued concern that
there might be "a language trap" [in Section 1 of the bill].
REPRESENTATIVE FIELDS reiterated that his intent was to
establish a population threshold rather than keep all DMV
offices open based on an arbitrary point in time in 2021.
3:40:56 PM
REPRESENTATIVE EASTMAN questioned how communities without an
existing DMV office currently operate.
REPRESENTATIVE FIELDS recalled that when the DMV office in
Utqiagvik was closed, stakeholders and local groups tried to
provide services that mirror those offered by the DMV. He
reflected on the "massive inconvenience" that the DMV closure
caused for that rural community, noting that the experience
informed his view on this bill.
REPRESENTATIVE EASTMAN pointed out that Alaska statutes require
a physical APOC office in every Senate district, which suggests
that the 18 Senate districts without one are, technically,
violating the law. He sought to clarify how the bill would be
enforced, asking "how do you make someone not close an office?"
REPRESENTATIVE FIELDS said [the legislature] relies on
commissioners following the law and if they fail to do so, the
question is who has the standing to take it to court and enforce
it. He offered his belief that most commissioners do their best
to follow the law.
CHAIR KREISS-TOMKINS surmised that with passage of this bill, a
community could bring suit over the closure of the local DMV
office and have a good case. He stated that Representative
Eastman's point is well taken and applies to other areas of law
and policy as well.
3:44:52 PM
REPRESENTATIVE EASTMAN asked whether the sponsor is concerned
that the bill could negatively impact the decision-making
process of opening new DMV offices "for fear of getting locked
into something forever."
REPRESENTATIVE FIELDS said he is not concerned due to the multi-
year record of net positive revenue in many DMVs under different
circumstances. He shared his belief that DOA could model a
requisite population to support net positive DMV operations in a
given community. He added that DOA could also look to the
experience of DMVs that have operated in rural areas.
3:45:54 PM
REPRESENTATIVE VANCE offered clarification regarding the Homer
DMV office. She said asserting that the commissioner has
arbitrarily closed the office "is on shaky ground." She claimed
that the [Homer] DMV employees had been out for medical reasons,
adding that the Soldotna DMV was supplementing appointments to
the best of its ability. She maintained that the Homer DMV
office is open for business. She expressed concern that the
bill would not be a "sound decision" because [the legislature]
requires yearly flexibility in the budget process to assist the
administration in deciding the future of DMV offices.
3:47:38 PM
REPRESENTATIVE KAUFMAN returned attention to Section 1 of the
bill and asked whether it would prevent an existing DMV office
from contracting out to fill a position for a short-term hire.
REPRESENTATIVE FIELDS offered to follow up with Legislative
Legal Services to make sure the current language would have no
unintended consequences.
REPRESENTATIVE EASTMAN related that there is money being
appropriate through the budget process to maintain existing DMV
offices. He pointed out that something can both cost money and
be revenue positive.
REPRESENTATIVE STORY opined that when closing certain services,
fairness and access should be considered. She expressed
appreciation to Representative Fields for bringing the bill
forward.
CHAIR KREISS-TOMKINS announced that HB 137 was held over.