03/16/2010 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB264 | |
| SB261 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 264 | TELECONFERENCED | |
| + | SB 11 | TELECONFERENCED | |
| + | SB 261 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
March 16, 2010
1:36 p.m.
MEMBERS PRESENT
Senator Joe Paskvan, Chair
Senator Bettye Davis
Senator Kevin Meyer
Senator Con Bunde
MEMBERS ABSENT
Senator Joe Thomas, Vice Chair
COMMITTEE CALENDAR
SENATE BILL NO. 264
"An Act relating to the board, investigations, and examinations
of the Alaska Commercial Fishing and Agriculture Bank; and
providing for an effective date."
- MOVED SB 264 OUT OF COMMITTEE
SENATE BILL NO. 261
"An Act relating to the membership of the Alcoholic Beverage
Control Board; and providing for an effective date."
- MOVED CSSB 261(L&C) OUT OF COMMITTEE
SENATE BILL NO. 11
"An Act relating to health care insurance coverage of a
dependent child who is less than 26 years of age and making a
conforming age amendment in the statute describing health
insurance policies that may be delivered or issued in this
state."
- SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
BILL: SB 264
SHORT TITLE: COMMERCIAL FISHING & AGRICULTURE BANK
SPONSOR(s): SENATOR(s) COGHILL
02/08/10 (S) READ THE FIRST TIME - REFERRALS
02/08/10 (S) L&C, FIN
03/16/10 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: SB 261
SHORT TITLE: ALCOHOLIC BEVERAGE CONTROL BD MEMBERS
SPONSOR(s): SENATOR(s) OLSON
02/05/10 (S) READ THE FIRST TIME - REFERRALS
02/05/10 (S) STA, L&C
02/18/10 (S) STA RPT 4DP
02/18/10 (S) DP: MENARD, FRENCH, MEYER, KOOKESH
02/18/10 (S) STA AT 9:00 AM BELTZ 105 (TSBldg)
02/18/10 (S) Moved SB 261 Out of Committee
02/18/10 (S) MINUTE(STA)
03/16/10 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: SB 11
SHORT TITLE: DEPENDENT HEALTH INSURANCE; AGE LIMIT
SPONSOR(s): SENATOR(s) DAVIS
01/21/09 (S) PREFILE RELEASED 1/9/09
01/21/09 (S) READ THE FIRST TIME - REFERRALS
01/21/09 (S) HSS, L&C, FIN
03/11/09 (S) HSS AT 1:30 PM BUTROVICH 205
03/11/09 (S) Heard & Held
03/11/09 (S) MINUTE(HSS)
03/18/09 (S) HSS AT 1:30 PM BUTROVICH 205
03/18/09 (S) Moved SB 11 Out of Committee
03/18/09 (S) MINUTE(HSS)
03/20/09 (S) HSS RPT 2DP 1NR
03/20/09 (S) DP: DAVIS, PASKVAN
03/20/09 (S) NR: DYSON
03/16/10 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
WITNESS REGISTER
SENATOR COGHILL
Alaska State Legislature
Juneau, AK
POSITION STATEMENT: Sponsor of SB 264.
LEA KLINGERT, CEO
Commercial Fishing and Agriculture Bank (CFAB)
POSITION STATEMENT: Supported SB 264.
TIM BENINTENDI
Staff to Senator Olson
Alaska State Legislature
Juneau, AK
POSITION STATEMENT: Presented SB 261 for the sponsor.
BERDA WILLSON, Chairperson
Kawerak Regional Wellness Forum
Nome, AK
POSITION STATEMENT: Supported SB 261.
SHIRLEY GIFFORD, Director
Alcoholic Beverage Control Board
Alaska Department of Public Safety (DPS)
POSITION STATEMENT: Neutral position on SB 261.
ACTION NARRATIVE
1:36:26 PM
CHAIR JOE PASKVAN called the Senate Labor and Commerce Standing
Committee meeting to order at 1:35 p.m. Present at the call to
order were Senators Davis, Meyer and Paskvan.
SB 264-COMMERCIAL FISHING & AGRICULTURE BANK
1:37:41 PM
CHAIR PASKVAN announced SB 264 to be the first order of
business.
SENATOR COGHILL, sponsor of SB 264, explained that this measure
does two things; it changes the makeup of the Board of the
Commercial Fishing and Agriculture Bank by taking the resident
farming seat out because of Alaska's dwindling pool of farmers.
It also puts back in statute the requirement for the Division of
Banking and Securities, Department of Commerce, Community and
Economic Development (DCCED), to audit the bank no less than
every 36 months.
SENATOR COGHILL explained that Section 1, page 1, adds the
Commercial Fishing and Agriculture Bank to the definition of
financial institutions under Title 6.
He said that Title 44, Sections 2-7, on pages 2-3, deals with
the Board and lines 13-14 delete the resident-farmer
requirement. Section 3 gives the Board of Banking and Securities
the requisite access to records of the CFAB so they can disclose
that information for auditing purposes. Presently, they get
audited annually. He explained that there are two ways to get
audited; one is through the Legislative Auditor and the other is
through an independent auditing firm and line 22 adds AS
44.81.275, which is the new auditing requirement for the Board
of Banking and Securities. Section 4 is a new section that gives
the Division of Banking and Securities the authority to do the
audit no less than 36 months apart. Definitions in that section
reflect that requirement. Section 5 on page 3, line 27, repeals
the resident farmer language in the definition section. He said
that sections 2 and 5 have an immediate effective date, and the
audits would begin by July 1, 2011.
1:41:19 PM
SENATOR BUNDE joined the committee.
1:41:55 PM
LEA KLINGERT, CEO, Commercial Fishing and Agriculture Bank
(CFAB), explained that CFAB was created by the legislature in
1980 at a time when there was considerable emphasis on the
development of agriculture in Alaska. There was hope that CFAB
would be a significant factor in the financing agricultural
loans in Alaska, and while it has made many agricultural loans
over its life, she said few have been made in the past few
years. She explained that since CFAB's elected directors are
drawn from and elected by its membership and since its
membership is essentially a function of a borrowing
relationship, the number of persons eligible to serve as a
formal director has dwindled.
She said in recent years the matter had been resolved through
persuasive pressure on competent and cooperative individuals,
but the welcome had been worn out with them. CFAB is a private
co-op owned by Alaska residents. She explained that it is a
relatively small institution governed by an active and committed
board of directors and is now entering its 30th year of service.
Now despite the logical and well-intended requirement of the
past, it has become critical for CFAB's members to reach into
the broad pool of its total membership - consisting not only of
fishers and theoretically farmers, but tourism operators, and
other resource based businesses as well - in order to maintain
the highest level of competence within its governing body.
Since the idea of removing the farmers' seat has been
introduced, Ms. Klingert said she had heard concerns or comments
to the effect that if this should happen, CFAB would cease
making loans to farmers, but that is not so. CFAB is open and
actively looking for any type of loans that are viable for them
to make.
With regards to the examination part of this legislation, Ms.
Klingert said, it might seem odd that a financial institution
would actively seek some new level of oversight especially where
it would involve new and uncontrollable financial cost, but CFAB
is different. Established and guided by AS 44.81, it is a
private institution; however, despite the private status there
are no proprietary interests in CFAB and there are no mechanisms
by which a party can invest in CFAB for profit as an objective.
She said that CFAB represents a collection of diverse but
nevertheless related fiduciary responsibilities; it borrows
money and lends that money to resident participants in the
commercial fishing community and other resource-based
industries. CFAB's board of directors, management and staff has
always been sensitive to those diverse fiduciary
responsibilities.
She said that it is true the CFAB welcomes an annual audit by a
professional firm and that the results of that audit are widely
disseminated, but such audits are focused primarily on
quantitative values and accounting protocols. Only peripherally
do they touch upon the quantitative aspects of lending policies,
practices and results. The state's bank examiners, however, are
trained in analytical and evaluative procedures and they are
prepared to express a judgment in each case as to the likelihood
of a loan's repayment in full. In addition, the examiners have
access to the results and experiences of numerous financial
institutions and can establish norms or guidelines by which
CFAB's effectiveness can be measured.
So in total, Ms. Klingert said, CFAB's board of directors and
management are enthusiastically in support of SB 264, and they
look forward both to the internal confidence and the external
credibility which will be engendered by the examiners' reports.
SENATOR BUNDE said he received a report about CFAB's net return
to the state and he asked if she had any numbers for
agriculture.
MS. KLINGERT replied that she didn't have that information.
1:48:15 PM
CHAIR PASKVAN closed public testimony.
SENATOR COGHILL noted a pending fiscal note of $10,000 for the
state to go through the auditing process, but CFAB would be
billed for that so it would zero out. He also remembered a date
of 2010, but the effective date doesn't happen until 2011; so
that should be corrected.
CHAIR PASKVAN said they have a fiscal noted dated March 15 that
indicates $10,600.
1:49:37 PM
SENATOR MEYER moved to report SB 264 from committee with
individual recommendations and attached fiscal note(s). There
were no objections and it was so ordered.
1:50:08 PM
CHAIR PASKVAN announced an at ease from 1:50 p.m. to 1:51 p.m.
1:51:59 PM
CHAIR PASKVAN called the meeting back to order.
SB 261-ALCOHOLIC BEVERAGE CONTROL BD MEMBERS
1:52:11 PM
CHAIR PASKVAN announced SB 261 to be up for consideration. He
moved to bring the committee substitute (CS) for SB 261 (), 26-
LS1406\E, before the committee. There were no objections and it
was so ordered.
1:53:24 PM
TIM BENINTENDI, staff to Senator Olson, sponsor of SB 261, said
this measure would respond to an array of alcohol related
problems particular to small communities in rural Alaska. Such
problems are well known, but wellness services cannot keep up
with, let alone contain, the adverse impacts of small town
alcohol consumption.
He said they feel the need is at hand to raise the profile of
this particular dimension to the problem of alcohol in Alaska by
bringing it into a public forum where more specific attention
and action could be brought to address the issue.
He said the state's Alcoholic Beverage Control (ABC) Board is
composed of five members, two of whom must be actively engaged
in the alcoholic beverage industry and three who must represent
the general public. Currently, SB 261 would refine one of the
public member seats to be a resident of a rural area. This is
where the CS diverges from the original bill that established a
population figure of 4500 in defining rural areas and further
said that applicants must be from communities that are not
accessible by road or rail system to Anchorage or Fairbanks.
MR. BENINTENDI explained that in the State Affairs Committee a
couple of questions came up about that definition. Someone asked
about a resident of Auke Bay. The short answer was that Auke Bay
is within a borough that has resources as well as being a place
name in the Juneau area. The CS modifies the definition of rural
area by deleting the population criteria and adding that the
applicants' community would have had to have participated in a
local option election under AS 04.11.491. It was felt that was a
stronger way to identify communities with these acute alcohol
problems.
In short, he said, the tightened definition of community now
includes the small municipalities and adds the provision that
the applicants' community could be an established village under
AS 04.21.080, which would bring in communities in the
unorganized borough. It includes all so-called hub communities,
which was Representative Herron's intention when he recommended
the provision. Mr. Benintendi said the sponsor was comfortable
with the definition. It suits the purpose of the bill, doesn't
put anybody out and passes legal muster.
SENATOR BUNDE said the fiscal note is zero because the board
currently has a rural resident, and asked if that member would
meet the criteria of the CS.
MR. BENINTENDI answered that member happened to be a gentleman
from Cordova, but he was a Governor's appointment and not a
designated seat. Right now, the three general public seats are
not further defined.
1:58:55 PM
SENATOR BUNDE remarked that would make two-thirds of the seats
urban Alaskan and one-third rural, and he asked if that somehow
follows the general populations of these areas.
MR. BENINTENDI replied that he didn't think the intent was to
follow a population dynamic but to provide for the small
communities. However, he said he didn't know what portion of
their populations would be represented in the overall state
population.
SENATOR BUNDE stated that he would hate to think one seat would
be designated to a relatively small population and would feel
more comfortable if Mr. Benintendi could look at those numbers
and find some balance.
CHAIR PASKVAN said there is a rural seat was being filled
informally now and he thought the intent, appropriately, was to
reflect that informal nature.
SENATOR BUNDE said his concern was that they would carve out a
small enough niche that 100 people would have one seat and that
600,070 would have two seats; then fairness would become an
issue.
2:01:23 PM
BERDA WILLSON, Chairperson, Kawerak Regional Wellness Forum,
Nome, AK, said she had seen the ravages of alcohol and other
substance abuse in rural Alaska. She said the Forum works
closely with all other agencies on wellness and safety issues.
She mentioned the high rates of suicide in her area are possibly
the highest in the nation and according to the police, alcohol
is involved in 90 percent of the cases. It is accompanied by
child abuse and domestic violence. Ms. Willson said they want a
voice on the ABC board that understands the real problems of
rural Alaska where most of the villages are dry, but alcohol is
still sold.
SENATOR BUNDE said the ABC board currently has a rural resident
and asked if she wanted a northwestern resident specifically.
MS. WILLSON answered yes, and pointed out that he was looking at
the whole population, but she was looking at the lives that are
lost or damaged, accidents and violence.
2:08:42 PM
SENATOR BUNDE thanked her for her work on the safety patrol and
said that he understood that safe patrol and bootlegging
problems were local implementation issues. He wanted a better
grasp of what she thought the ABC Board could and would do to
help with this problem if this bill passed.
MS. WILLSON answered that they could do more stings, for
instance, and at times like 5 a.m. in the morning or provide
more undercover agents. For instance she was talking to some of
the patrolmen who were on patrol last night who said they had to
go into the bars and escort overly intoxicated people out, but
she thought that was the role of the bars.
SENATOR BUNDE said it is currently against the law to serve
someone who is intoxicated. He was wondering what new laws they
might come up with if this bill passes.
MS. WILLSON answered that she would be happy if the current laws
were complied with. She said the Board conducted a sting up in
Nome and cited one establishment, but she heard that instead of
closing the establishment immediately they let it stay open
through Iditarod so it wouldn't lose money, and then closed it.
2:11:26 PM
SHIRLEY GIFFORD, Director, Alcoholic Beverage Control Board,
Alaska Department of Public Safety (DPS), said she had every
intention of going to Nome and talking with Ms. Willson's group.
She said that she had spent some time in Nome as interim chief
and it was the eye opener for her in terms of experience in
rural Alaska as she had served most of her career in Anchorage
where she finished her career as captain of detectives. She
mentioned that she had also spent time in Soldotna as the Chief
of Police.
MS. GIFFORD said as director of the ABC Board that she was
neutral on SB 261, only because the board already had a rural
member, Belen Cook, who does a tremendous job. Ms. Cook took her
place when she left the board to become the director.
CHAIR PASKVAN asked if it was fair to say that while she is
neutral as the director that it is a good thing that a rural
member sits on the board.
MS. GIFFORD answered yes. Life is very different in the Bush
than it is in the urban communities, but she also agreed that
this is not the last or the greatest tool for the problems that
are occurring in rural Alaska. She said that Nome is a focus for
the Board, and they will continue to do compliance checks there
and listen to what the needs are using the four investigators
that she has. She added that she depends on local and state
police to assist them in enforcing Title 4 and 13 AAC
regulations.
SENATOR BUNDE thanked her for her past service and the courage
she displayed in taking on alcohol problems in Alaska and asked
what the board would do differently if this bill passed.
MS. GIFFORD answered that the board wouldn't do anything
differently, because it already has rural representation, and
her voice is getting stronger the more experience she gets and
they will continue doing compliance checks.
She said mandating a rural member would not be a fix-all, but it
might make people feel a little bit better knowing they are
represented. She said the bootlegging issues are dealt with by
the State Troopers and the Board's focus is on how the licensees
follow the laws and 90 percent of them are doing the right
thing.
MR. BENINTENDI responded to Senator Bunde's earlier concern
about delegating one seat to a small population by explaining
that in modifying the definition of a rural area for the CS,
they did ensure that all of the so-called regional hubs would be
hooked in. For example, in the original version a resident from
Bethel would not be eligible to apply for that seat, but once
the definition was changed a Bethel person would be eligible. He
estimated that it might broaden the base of applicants to about
20 percent of the state's population, not just a couple hundred.
He also remarked that while there has been a history of rural
residents sitting on the board, this measure would ensure that
at least one seat would be for a rural resident.
2:21:14 PM
CHAIR PASKVAN closed public testimony and found no discussion.
SENATOR MEYER moved to report CSSB 261 (), version E, from
committee with individual recommendations and attached zero
fiscal note(s).
SENATOR BUNDE objected. He explained that he was not against
having more enforcement of alcohol problems throughout the state
particularly in rural areas, but the state already has laws on
the books that would solve these problems if they had the people
to do the enforcement. He thought that maybe the focus for them
should be on enforcement and not on what he thought was an
illusionary effort. He didn't see anything being done
differently, and he harbored a great concern for a possible
downside that they would pass a law that really has minimal or
no impact and the public becomes discouraged because they
thought something would get better.
2:23:49 PM
A roll call vote was taken. Senators Davis, Meyer and Paskvan
voted yea; Senator Bunde voted nay; so therefore, CSSB 261 (L&C)
moved from committee.
2:24:26 PM
CHAIR PASKVAN took an at ease from 2:24 p.m. to 2:28 p.m.
2:28:49 PM
CHAIR PASKVAN called the meeting back to order at 2:28 and said
that Senator Davis asked to withdraw SB 11 from today's agenda.
2:30:02 PM
Finding no further business to come before the committee, Chair
Paskvan adjourned the meeting at 2:30 p.m.
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