Legislature(1993 - 1994)

03/09/1994 01:15 PM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  Number 660                                                                   
  HB 300 -  LIABILITY: COMMERCIAL RECREATION ACTIVITY                          
  CHAIR PORTER stated that HB 300 would be taken up next.                      
  Number 665                                                                   
  REP. BILL HUDSON, Chair of the House Labor & Commerce                        
  Committee, sponsor of HB 300, said the bill was developed                    
  upon the request of small tourism based businesses and other                 
  recreational organizations/businesses.                                       
  REP. HUDSON said that HB 300 would establish a balance of                    
  responsibility of those operating the activities, as well as                 
  those who participate in commercial recreational facilities.                 
  (Rep. Hudson read from a sponsor statement.)  For further                    
  clarification he quoted Section 2 from the sectional                         
  REP. HUDSON said that passage of this bill would reduce                      
  insurance premiums as well as reduce accidents.                              
  REP. HUDSON added that he had four amendments for the                        
  committee's consideration.                                                   
  Number 785                                                                   
  KAREN COWART, Alaska Visitors Association, testified in                      
  support of HB 300.  She said it is imperative for the                        
  recreational industry to allow growth and development.                       
  Currently, she said costs are rising greatly because of                      
  nuisance litigation, inhibiting the growth and expansion of                  
  businesses.  The passage of HB 300, by clarifying                            
  responsibility of the individual as well as business, would                  
  alleviate the high cost of liability insurance.                              
  Number 800                                                                   
  NANCY LETHCOE, President, Alaska Wilderness Recreation and                   
  Tourism Association, testified in support of HB 300 and the                  
  additional amendments offered by Rep. Hudson.                                
  MS. LETHCOE said that adventure travel and ecotourism                        
  businesses are growing at a rate of twenty percent a year.                   
  She went on to say that passage of HB 300 would guarantee a                  
  basic standard and professional expertise when working with                  
  REP. NORDLUND said he supported HB 300 because he felt that                  
  it would help make operations safer and help clarify the                     
  inherent risk involved in some of the stated recreational                    
  activities.  He asked if passage of HB 300 will help                         
  decrease insurance cost.                                                     
  Number 866                                                                   
  MS. LETHCOE responded yes and further stated that it was                     
  requested by the insurance company that her organization                     
  pursue legislation with regard to liability.  She went on to                 
  say that in other states with similar legislation studies                    
  show a decrease of 15-20% in insurance rates.                                
  TAPE 94-36, SIDE A                                                           
  Number 010                                                                   
  REP. NORDLUND asked Ms. Lethcoe if she would follow up with                  
  him in the next year to see if passage of HB 300 did Affect                  
  insurance rates.                                                             
  REP. PHILLIPS commented on the high insurance rates she                      
  experienced as a private business owner.                                     
  Number 028                                                                   
  MS. LETHCOE added that many entrepreneurs have researched a                  
  potential business, have the professional training and                       
  financial capabilities to open and operate a business, but                   
  the cost of insurance is prohibitive.                                        
  CHAIR PORTER asked for a motion to adopt CSHB 300(JUD).                      
  Rep. James moved the motion.  CSHB 300(JUD) was adopted.                     
  REP. HUDSON discussed the amendments as follows:  on page 2,                 
  line 10, after "learn about" add "and expressly accepts"  to                 
  more specifically state that someone not only learns about                   
  but accepts.                                                                 
  Number 129                                                                   
  The committee discussed whether the wording should be                        
  "accept" rather than "accepts."  It was decided that                         
  "accept" was acceptable.                                                     
  Number 184                                                                   
  REP. NORDLUND asked what the exact meaning of "expressly                     
  accept" and aired a concern that perhaps this wording would                  
  create more litigation than it would discourage.  He asked                   
  if it meant a written statement.                                             
  Number 202                                                                   
  REP. HUDSON said it was state of the art expression.                         
  With no objection, Amendment 1 was adopted.                                  
  REP. HUDSON continued with Amendment 2, page 2, line 24,                     
  insert after (A) "fundamental."  This was a recommendation                   
  from outfitters and guide associations, the two underwriters                 
  of liability.                                                                
  Rep. Hudson said that line 2 would read "fundamental and                     
  inherent risks."  It would be impossible to explain all the                  
  inherent risks and by inserting fundamental would recognize                  
  that fact.                                                                   
  Number 216                                                                   
  Amendment 2 was moved and adopted without objection.                         
  Number 229                                                                   
  REP. HUDSON offered Amendment 3, page 2, line 25, delete                     
  "safely."  He said that it was brought to his attention that                 
  though an organization may make every effort to make a                       
  particular activity safe, safety can not be guaranteed.                      
  With Amendment 2 it clarifies the language in case of                        
  Number 250                                                                   
  REP. GREEN objected to the amendment for purposes of                         
  discussion.  He aired a concern regarding the potential                      
  shifting of responsibility to the operator.                                  
  Number 270                                                                   
  REP. NORDLUND shared Rep. Green's concern.  He commented                     
  that removing "safely" did not really change anything.                       
  Number 294                                                                   
  REP. HUDSON said there is inherent risk involved in the type                 
  of activities addressed in HB 300.  A business or                            
  organization can educate and inform participants but cannot                  
  guarantee that the individual could "safely" participate.                    
  He further noted that if "safely" were left in, it may                       
  encourage litigation rather than discourage it.                              
  REP. JAMES supported the amendment and said that an                          
  individual could have all the appropriate equipment and                      
  skill but the activity could still be unsafe.                                
  Number 312                                                                   
  REP. GREEN noted that in the bill it says that an                            
  organization or business only has to "explain" the risks,                    
  not guarantee safety.                                                        
  Number 320                                                                   
  REP. JAMES, CHAIR PORTER and DANIELLA LOPER agreed with the                  
  concerns of Rep. Hudson.                                                     
  REP. GREEN maintained his objection to Amendment 3.  A roll                  
  call vote was taken.  Amendment 3 was adopted.                               
  Number 360                                                                   
  REP. HUDSON introduced Amendment 4, which lists types of                     
  activities that pertain to HB 300.                                           
  Number 396                                                                   
  REP. JAMES asked if "adventure" could be included to cover                   
  types of activities.                                                         
  Number 405                                                                   
  MS. LETHCOE requested that "llama trips" be added to the                     
  Number 419                                                                   
  REP. NORDLUND pointed out that the statement "...but not                     
  limited to" does not remove the legal problem.  He further                   
  noted that by establishing a listing, that listing elevates                  
  those activities to a greater level of validity and that by                  
  having a listing, it invites more potential litigation than                  
  it deters.                                                                   
  Number 432                                                                   
  REP. HUDSON asked the committee to address the amendment as                  
  written including the requests by Nancy Lethcoe to add                       
  "llama treks and dog sledding."                                              
  REP. GREEN commented that the amendment was getting into                     
  specifics and when doing that it creates exclusion.  He                      
  suggested the committee leave the listing out.                               
  REP. KOTT agreed with Rep. Green's comments.                                 
  MS. COWART asked if those participating in unsupervised                      
  activities would be included in the bill.                                    
  CHAIR PORTER said they would be included.                                    
  MS. COWART agreed that exclusion is better because of the                    
  fact that there are a growing number of new businesses with                  
  varying kinds of activities that may not be included in the                  
  list and thereby potentially forcing them to pay higher                      
  insurance rates because they would not be included in this                   
  REP. PHILLIPS reiterated that the bill states "...includes                   
  but not limited to."                                                         
  Number 504                                                                   
  CHAIR PORTER said he felt there was enough on record                         
  describing the kinds of activities the bill addresses.  He                   
  further suggested the committee not adopt Amendment 4.                       
  Number 510                                                                   
  CHAIR PORTER asked if there was further discussion.  Hearing                 
  none, he asked if there were objections.                                     
  Number 520                                                                   
  REP. GREEN maintained his objection.  A roll call vote was                   
  taken and Amendment 4 failed.                                                
  Number 526                                                                   
  CHAIR PORTER asked if Rep. Hudson had any further comments                   
  on HB 300.                                                                   
  Number 528                                                                   
  REP. HUDSON said he was satisfied with the work the                          
  committee had done with HB 300.                                              
  Number 537                                                                   
  REP. JAMES motioned to move CSHB 300(JUD) with individual                    
  recommendations and zero fiscal note.  Without objection, it                 
  was so moved.                                                                
  Number 565                                                                   
  CHAIR PORTER announced that the committee would take up the                  
  continuation of HB 292 on Friday; and on Saturday, March 12,                 
  the committee would continue with the Friday schedule.                       
  CHAIR PORTER adjourned the meeting at 3:40 p.m.                              

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