Legislature(2019 - 2020)BELTZ 105 (TSBldg)
02/11/2020 01:30 PM Senate LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB47 | |
| SB76 | |
| SB81 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 81 | TELECONFERENCED | |
| += | SB 47 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 76 | TELECONFERENCED | |
SB 81-TELEPHONE COOPERATIVES;TELECOMMUNICATIONS
2:08:07 PM
CHAIR BISHOP reconvened the meeting and announced the first
hearing of SENATE BILL NO. 81, "An Act relating to electric and
telephone cooperatives; and relating to telephone service and
related telecommunications services."
2:08:26 PM
SENATOR SHELLEY HUGHES, Alaska State Legislature, Juneau,
Alaska, sponsor of SB 81, related that a year or two ago when
she was visiting with members of her local telephone co-op, she
suggested that the term "telephone" should be changed to reflect
the broader scope of service. The members said they had a bill
on that point and asked if she would like to carry it. She
agreed.
SENATOR HUGHES explained that SB 81 would provide updates to
allow telephone cooperatives to use current technology and
conduct business more efficiently. This will help co-op members
engage more effectively and allow telephone associations to use
updated terminology to describe themselves. The bill will also
allow cooperatives to discuss personnel matters and
competitively sensitive information in executive session. This
language mirrors existing statutes.
2:12:02 PM
DAWSON MANN, Intern, Senator Shelley Hughes, Alaska State
Legislature, Juneau, Alaska, paraphrased the following sponsor
statement for SB 81: [Original punctuation provided.]
Senate Bill 81 updates the Electric and Telephone
Cooperatives Act to allow cooperatives the ability to
assimilate twenty-first-century technology into their
governance process and to update their name to better
communicate the services they provide.
SB 81 will allow cooperatives to adopt into their
bylaws the options of providing members with
electronic notice of membership meetings, conducting
annual meetings through teleconference, and counting
voting members who attend via teleconference for the
purposes of a quorum. These provisions will allow
cooperatives to more thoroughly engage their members
and allow members to more readily take an active role
regardless of their location, the weather, the cost or
any other obstacle that may be a challenge for in-
person attendance.
Over half a dozen electric and telephone cooperatives
have the word "association" in their name due to their
creation prior to the statutory requirement to have
"cooperative" in their name. SB 81 allows the word
"association" in place of the word "cooperatives" in
the name of the cooperative. Additionally, SB 81
allows telephone cooperatives to use the words
"telecommunications" or "telecom" in place of
'telephone' in the cooperative's name. These simple
changes will allow these cooperatives the flexibility
to make changes to their name to one that is a more
suitable descriptor of the services they provide.
By supporting these simple and yet effective changes
to the Electric and Telephone Cooperatives Act that
are proposed in SB 81, we will be affording Alaska's
electric and telephone cooperatives throughout the
state the ability to represent the services they offer
more appropriately via the names of their entities and
to conduct business as a cooperative in a more
practical manner using the very technologies they
currently provide to the public.
MR. MANN delivered the following sectional analysis for SB 81:
2:14:00 PM
Sections 1-3 Alaska Cooperative Corporation Act; Page 1.
Sec. 1 AS 10.15.005 Page 1, Lines 4-8
Section one adds "related telecommunications service"
to the list of excluded purposes, for the type of
cooperative under the Alaska Cooperative Corporation
Act from which electric and telephone services are
already excluded.
Sec. 2 AS 10.15.575 Page 1, Lines 9-14, Page 2, Line
1
This section adds "related telecommunication service"
to the list of cooperative types exempted from
restrictions on the use of the term "cooperative" in
its title under the Alaska Cooperative Corporation
Act.
Sec. 3 AS 10.15.585 Page 2, Lines 2-8
This section adds "related telecommunication service"
to the list of cooperatives types exempted from the
application of the Alaska Cooperative Corporation Act.
Sections 3-21 Electric and Telephone Cooperative Act;
Pages 1-3.
Sec. 4 AS 10.25.010(a) Page 2, Lines 9-31, Page 3,
Lines 1-14
This section adds "related telecommunications service"
to the list of physical line types that cooperatives
have the power to maintain under and across public
lands through the Electric and Telephone Cooperative
Act.
Sec. 5 10.25.030(a) Page 3, Lines 15-31, Page 4,
Line 1
This section broadens the purpose of telephone
cooperatives to cover all related telecommunications
services and allow cooperatives to offer a full range
of telecommunication services.
Sec. 6 AS 10.25.040(a) Page 4, Lines 2-5
This section adds "telecommunications" and "telecom"
to the list of potential terms mandated in the name of
cooperatives based on services. It also allows for the
use of the term "association "in the naming of a
cooperative and changes the abbreviation for
cooperatives to "Inc.".
Sec. 7 AS 10.25.080(a) Page 4, Lines 6-11.
This section adds "related telecommunications" to the
list of services an individual agrees to use to be
considered a member of the cooperative under the
Electric and Telephone Cooperative Act.
Sec. 8 AS 10.25.090(a) Page 4, Lines 12-18
This section removes the explicit obligation for
cooperatives to hold member meetings at a time and
place outlined in their bylaws and instead directs
them to conduct meetings more generally as their
bylaws direct. It also clarifies that the relevant
bylaws in this section are the bylaws of the
cooperative. This section also allows for the annual
meetings of cooperatives to be conducted through
teleconference unless prohibited by cooperative
bylaws.
CHAIR BISHOP noted that the bill would also allow cooperatives
to conduct meetings by teleconference.
MR. MANN agreed and continued the sectional.
Sec. 9 AS 10.25.090(c) Page 4, Lines 19-22
This section removes the explicit obligation for
cooperatives to hold district delegate meeting at a
time and place outlined in their bylaws and instead
directs them to conduct meetings more generally as
their bylaws direct. It also clarifies that the
relevant bylaws for this section are the bylaws of the
cooperative.
Sec. 10 AS 10.25.100 Page 4, Lines 23-31, Page 5,
Lines 1-8
This section adds the use of electronic mail and text
messages to the list of acceptable means of
communicating notices of regular and special meetings
of a cooperative. This section also provides further
clarification of the time restrictions of notices of
meetings while also outlining what constitutes being
given "notice" with relation to email and text
notifications.
Sec. 11 AS 10.25.110(a) Page 5, Lines 9-19
This section establishes that individuals considered
present under 10.25.110 (c) may be considered present
to make a vote to adjourn in circumstances in which
quorum has not been met.
2:18:25 PM
Sec. 12 AS 10.25.110 Page 5, Lines 20-22
This section adds subsection (c) to 10.25.110 which
allows for those members or delegates that vote
electronically to be considered having attended the
meeting.
Sec. 13 AS 10.25.175(a) Page 5, Lines 23-31
This section removes "similar communications equipment
from the description of authorized teleconference
meetings for a cooperative board of directors.
Sec. 14 AS 10.25.175(c) Page 6, Lines 1-13
This section adds "personnel matters" and "matters the
immediate knowledge of which could have an adverse
effect on the ability of the cooperative to compete in
the market served by the cooperative" to the list of
subjects of discussion in an executive session.
Sec. 15 AS 10.25.290(a) Page 6, Lines 15-19
This section adds "related telecommunications
services" to the list of services that a corporation
could supply to be permissible to convert to a
cooperative once it has met the requirements of this
chapter.
Sec. 16 AS 10.25.430 Page 6, Lines 20-31, Page 7,
Lines 1-3
This section replaces references to 7 U.S.C. 901 -
950B with 7 U.S.C. 901 - 950bb-2 and removes "of 1936"
from the references to the Rural Electrification Act
of 1936 to update the chapters references to federal
law.
Sec. 17 AS 10.25.460 Page 7, Lines 4-12
This section adds "a domestic or foreign corporation
authorized to transact business in the state whose
business office is identical with the registered
office" to the types of agents a cooperative is
required to maintain in the state.
Sec. 18 AS 10.25.810 Page 7, Lines 13-17
This section adds "related telecommunications service"
to the list purposes for which a cooperative,
nonprofit, membership corporations may be organized
under this chapter.
Sec. 19 AS 10.25.820 Page 7, Lines 18-25
This section adds "related telecommunications
service" to the list of services provided by existing
nonprofit cooperatives that are subject to this
chapter as if originally organized by it.
Sec. 20 AS 10.25.840 Page 7, Lines 26-31, Page 8,
Lines 1-4
This section adds a paragraph defining the term
"related telecommunications service" to mean the
transmission and reception of messages, impressions,
pictures, and signals by means of electricity,
electromagnetic waves, or any other source of energy,
force variations, or impulses, whether conveyed by
cable, wire, radiated through space, or transmitted
through other media; or a service capable of
electronically generating, acquiring, storing,
transforming, processing, retrieving, utilizing, or
making available information, through the use of
broadband Internet access, data center services,
information technology, or other technology services.
Sec. 21 AS 10.25.030(b) and 10.25.400(e) Page 8, Line
5
This section repeals AS 10.25.030(b) which outlined
the original meaning of "related telecommunications
service". It also repeals AS 10.25.400(e) which
excludes telephone cooperatives which have an annual
gross revenue exceeding $25,000,000 from AS
10.25.400(b) (which outlines the actions that must be
taken by a cooperative's board of directors before a
disposition or sale of more than 15% of a
cooperative's total assets) unless a resolution is
passed by the cooperative's board of directors to make
AS 10.25.400(b) apply.
2:21:57 PM
SENATOR HUGHES pointed out that the bill uses the term
"teleconference," which includes communication over the internet
using microphones and speakers. The telecommunications community
has a preference for the language that refers to that and may
request clarification. She also pointed out that there are 17
telephone utility cooperatives and 17 electric cooperatives that
provide service throughout Alaska. She said she was not aware of
any opposition to the bill and both the Alaska Telephone
Association and the Alaska Power Association have written
letters of support.
She commented that the small fiscal note could be covered by
passing the hat and thus avoid a finance referral.
2:24:02 PM
SENATOR STEVENS referenced Section 15 and asked if the list of
services that a corporation could supply to be permissible to
convert to a cooperative was actually listed in the bill.
SENATOR HUGHES deferred the question to an expert in the room.
2:24:59 PM
RYAN PONDER, Director, Legal, Regulatory and Government Affairs,
Matanuska Telephone Association, Palmer, Alaska, said a list of
electric and telecommunication cooperatives that will be
affected by the bill was distributed but it is more appropriate
to describe SB 81 as a bill that will empower co-op customers to
better manage their service providers. It updates the statutes
to the 21st century.
Responding to Senator Stevens' question, he explained that
Section 20 provides a definition for "related telecommunications
services." It includes all the types of services one would
expect from a technology company that offers broadband
communication.
2:27:52 PM
MR. PONDER began the PowerPoint. He spoke to the following
points that describe telephone cooperatives in Alaska and why
the update was needed:
• Since before statehood, Alaskans have joined
together to form electric and telephone
cooperatives. They did this to bring electric and
telephone service to areas that other utilities
had no interest in serving.
• Today, electric and telephone cooperatives are
the economic backbone of their communities,
providing affordable and reliable power,
telecommunications, broadband internet and other
vital technology services to thousands of their
members all across Alaska.
• Alaska statutes for telephone and electric
cooperatives, adopted in 1959, are outdated.
Decades have passed without needed substantive
revisions to reflect changes in law and
technology.
• Current statutes place undue restrictions on the
member-owners of telephone and electric
cooperatives regarding how they can operate and
manage the cooperative and take advantage of
current technology.
• Statutes also are very limiting in the types of
services that cooperatives can offer, restricting
a cooperative's ability to meet its membership
needs.
MR. PONDER highlighted the following proposed changes
to the Electronic and Telephone Cooperative Act:
Broadly speaking, the proposed amendments to the Act
would:
• Expand the definition of the services a telephone
cooperative can provide to cover all of the
telecommunications and information services that
cooperative customers expect;
• Further expand cooperatives' ability to use
electronic means to communicate with their
members and conduct cooperative business;
• Update the reasons a cooperative's board can
conduct an executive session to better reflect
disclosure concerns of employment matters and
protect cooperatives operating in competitive
markets;
He noted that as stated earlier, this mirrors what is
already in Chapters 6 and Chapter 15 of Title 10.
• Improve the language regarding cooperative
registered agents and sales of cooperative
assets.
• Changes in technology require additional services
to be offered
• Transparency, accountability and privacy are
required by members
• Protection of aggregate and specific data
required for providers to protect the value of
cooperative
• Improved communication methods between members
and their co-op assure increased member
involvement
2:30:35 PM
MR. PONDER displayed the following benefits that the
update will achieve:
• Adding "or a related telecommunications service"
permits telephone cooperatives to offer broadband
and other data services that are required by
their Members and Federal Regulations through the
cooperative rather than a subsidiary, thereby
permitting customers to be members of the
cooperative.
• Amending AS 10.25.040(a) allows cooperative
members to use something other than "telephone"
in the cooperative's name, which better reflects
the nature of services cooperatives are currently
offering.
• Allows all cooperatives to use the word
"association" in the name, not just grand-
fathered in existing cooperatives
MR. PONDER related that years ago the legislature informed
all cooperatives that had "association" in their name that
they were not in compliance with the statute because they
didn't have "cooperative" in their name. It took some time
to explain to the legislature that these names were
grandfathered. SB 81 will eliminate the possibility of that
happening in the future.
He continued to describe the following benefits of updating
the Electronic and Telephone Cooperative Act:
• Allows members to receive notice of meetings
electronically (10.25.100)
• Allows members to attend annual meetings by
teleconference (10.25.090)
• Allows teleconferenced attendees to be part of
the quorum (10.25.110)
• Allows members who voted by mail or electronic
means to be part of the quorum (10.25.110)
• Allows discussion of personnel matters in
executive session (10.25.175)
• Allows discussion of matters affecting
competitive factors in executive session
(10.25.175)
MR. PONDER displayed the following points to summarize why SB 81
was necessary:
• Aligns naming convention with historical names before
current legislation was adopted
• Aligns names with industry standards and service offerings
• Aligns legislation with current member service needs and
regulation
• Protects integrity of the cooperatives
• Allows for increased member involvement
CHAIR BISHOP asked if the bill would provide any monetary
benefits.
MR. PONDER said yes. The statutes require that every co-op
member is mailed notification of annual meetings so it would be
a sizable savings if all the cooperatives could send those
electronically. He noted that MTA alone has 30,000 members.
2:33:13 PM
SENATOR STEVENS asked if the electrical cooperatives in Cordova,
Homer, and Kodiak support SB 81.
MR. PONDER said absolutely; both the Alaska Telecom Association
(ATA) and the Alaska Power Association (APA) support the
legislation.
2:34:10 PM
At ease
2:34:35 PM
CHAIR BISHOP reconvened the meeting and asked who supplied the
language for Section 20.
MR. PONDER replied Mr. Lehman with APA supplied the language. He
offered his belief that it reflects the FCC definitions.
2:35:28 PM
MICHAEL BURKE, CEO, Matanuska Telephone Association, Palmer,
Alaska, stated support for SB 81. He said this legislation is
past due. The Act has had no major changes since it was enacted
in 1959 even though technology and the way members and owners
interact have changed. SB 81 will also provide the members with
flexibility in how they interact and manage the affairs of their
co-op. The bill would allow members to change the bylaws of
their cooperative if they decided it was beneficial but it was
not compulsory. He said there wasn't any downside for the MTA
membership and how it wants to conduct business going forward.
2:37:39 PM
CHRISTINE O'CONNOR, Executive Director, Alaska Telecom
Association, stated that ATA represents broadband, landline, and
wireless telecommunication companies statewide. She testified
that SB 81 will allow modern cooperatives in Alaska to operate
in a modern way which will accommodate more effective and
efficient service. She reported that ATA's members unanimously
support SB 81.
2:38:49 PM
CRYSTAL ENKVIST, Executive Director, Alaska Power Association,
Anchorage, Alaska, stated that APA is the statewide trade
association for Alaska's electric utilities. The members provide
power to more than 0.5 million Alaskans statewide. She reported
that APA supports SB 81 which would modify statutes governing
telephone and electric cooperatives to accommodate technological
advances in communications. In particular, sections 8, 10, and
11 of the bill will provide more flexibility for cooperative
members in their annual meetings.
2:40:35 PM
CHAIR BISHOP opened public testimony on SB 81. Finding none, he
said he would leave it open and hold SB 81 for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 81 Sponsor Statement ver M.pdf |
SL&C 2/11/2020 1:30:00 PM |
SB 81 |
| SB 81 Sectional Analysis ver M.pdf |
SL&C 2/11/2020 1:30:00 PM |
SB 81 |
| SB 81 DRAFT Fiscal Note DCCED-CBPL-02-07-2020.pdf |
SL&C 2/11/2020 1:30:00 PM |
SB 81 |
| SB 81 Presentation.pdf |
SL&C 2/11/2020 1:30:00 PM |
SB 81 |
| SB 81 Alaska telephone cooperative coverage map.pdf |
SL&C 2/11/2020 1:30:00 PM |
SB 81 |
| SB 81 Letters and Resolutions 02-10-2020.pdf |
SL&C 2/11/2020 1:30:00 PM |
SB 81 |