Legislature(2013 - 2014)BARNES 124
04/01/2013 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB187 | |
| HB125 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 187 | TELECONFERENCED | |
| += | HB 125 | TELECONFERENCED | |
HB 187-OCCUPATIONAL LICENSING FEES
3:24:36 PM
CHAIR OLSON announced that the first order of business would be
HOUSE BILL NO. 187 "An Act relating to professional and
occupational licensing fees, including renewal fees, duplicate
license fees, examination fees, instructor license fees,
temporary license fees, continuing education course
certification fees, out-of-state permit fees, delinquency fees,
application fees, penalty fees, and trainee license fees; and
providing for an effective date."
3:25:30 PM
CRYSTAL KOENEMAN, Special Assistant, Office of the Commissioner,
Department of Commerce, Community & Economic Development
(DCCED), introduced herself.
DON HABEGER, Director, Division of Corporations, Business, and
Professional Licensing (DCBPL), Department of Commerce,
Community, & Economic Development (DCCED), introduced himself.
3:25:54 PM
MR. HABEGER explained that the division has heard from a number
of its 63,000 professional licensees with respect to
professional licensing fee increases. In 2011, during a draft
regulations project for the Real Estate Commission (REC), the
REC commented in such a manner that it became a press issue. On
November 1, 2011, the Juneau Empire printed an article entitled,
"Legislature Hears Complaints About Real Estate Licenses -
Agents, Brokers Urge Huge Increases Be Back - Cut Costs." Thus,
the real estate clientele can become vocal when fee increases
are significant. About the same time, in July 2011, the
Legislative Audit Division released a special audit report
entitled, "Select Occupational Licensing Enforcement Issues,
Audit Control Number 08-30063-11," in which numerous audit
recommendations were made. Recommendation 1 was that the
Division of Corporations, Business and Professional
Licensing's (DCBPL) director should ensure occupational
licensing fees are adjusted annually in accordance with state
law. State law requires the department to annually review each
fee level and make adjustments when revenue and expenses are not
approximately equal. He referred to AS 08.01.065, which relates
to each occupation.
3:29:02 PM
MR. HABEGER noted the requirement to adjust each occupation is a
significant issue, which is one of the drivers of HB 187. Each
occupation is defined as part of a subgroup of the program under
AS 08.01.01. In particular, the legislative audit recommended
setting fees by occupation; however, doing so can be
problematic. For example, registered guides include master
guide-outfitters, registered guide-outfitters, class-A guides,
assistant guides, and transporters. In order for the division
to comply with the legislative auditor's recommendation, the
division would need to track the revenues and expenses for each
of these occupations. He related that HB 187 is the response to
this issue since the department oversees numerous occupations.
3:30:43 PM
MR. HABEGER held up a chart [not distributed to members] and
reported that the division has 115 different occupations with
approximately 400 different fees, including professional
licensing fees, examination fees, and copying fees. This bill
would attempt to reduce the tracking burden for the department
in three ways. First, the bill would extend the cycle of time
for making fee adjustments. For example, in FY 12, the Board of
Nursing had $1.299 million in cumulative surplus of licensing
fees. Although statute specifies that this surplus should be
returned to licensees, the statute doesn't consider that
revenues and expenditures are based on a two-year cycle such
that when the period is extended, the fees and revenues tend to
level out over time. Currently, the licensing fee for nurses is
set at $175, and the division would like to extend the fee, hold
discussions with the board, and set a stable proposed fee.
Second, the bill would collapse fees within each occupation. He
again referred to tracking sub-levels of the guiding industry,
which can become administratively burdensome for the division.
Additionally, other occupations have sub-levels, noting the
State Medical Board has fees for osteopaths, physicians, and
podiatrists. In FY 12, the division licensed 26 podiatrist
licensees. An investigation held on another occupation exceeded
$100,000 in investigative costs that year, which would have
resulted in a $3,000 increase in licensing fees if the case had
pertained to a podiatrist. Lastly, the third change relates to
a general fund appropriation for investigations. The division
is requesting $1.7 million to cover investigative costs, which
would allow the division to share the cost of investigations
since the division's investigations benefit all Alaskans, not
just licensees. Additionally, as previously mentioned,
investigative costs can contribute to the spiking of licensing
fees, which the division would like to avoid.
MS. KOENEMAN agreed that investigative costs is one reason for
the bill, but the department would also like to ensure that
licensees bear some costs, which is why the division is asking
investigators to account for their time spent specifically on
individual investigations. Thus, licensees would be responsible
for bearing the cost of administrative hearings, mediations, or
other legal costs for their profession to help ensure the
occupations are responsive and share a portion of the costs.
3:37:26 PM
MS. KOENEMAN provided a brief section-by-section analysis of the
bill. She related that Sections 1 and 2 are housekeeping
measures that provide technical changes which reference the new
establishment of fees under Section 4 or AS 08.01.065. Section
3 would remove specific fees set out by statute, thus giving the
department the ability to consolidate fee types. As Mr. Habeger
previously mentioned, the division has over 400 individual fees
and this section would allow the division an opportunity to work
with the boards to prioritize and determine fees.
MS. KOENEMAN explained that Section 4 is really the "heart" of
the bill. It would allow the department the ability to
establish fees using fees collected plus any appropriations, but
the language change would not bind this legislature or future
legislatures. This provision would allow the department to
average licensing group's revenues and expenditures for current
and prior licensing cycles to establish fee levels. This
provision would also allow the department to reduce a calculated
fee if the specific fee would be significantly higher than the
current fee. In some professions, such as realtors, licensees
have experienced a 140 percent increase in professional
licensing fees, which is significant. The department does not
want to burden licensees; however, it does want businesses open
and ready to conduct business. Additionally, the division is
required to recover any costs that may result from a reduced fee
over future licensing periods. Further, this section requires
the department to post fee reductions on the department's
website. Finally, the department is required to consider
recommendations by the board and this section also defines
"regulatory costs."
3:41:03 PM
MS. KOENEMAN stated that Sections 5 and 6 of the bill are
"clean-up" or housekeeping provisions for establishing fees.
Section 7 would define a new licensing group that will encompass
all the license types regulated by a board, commission, or
department, which will give the department more latitude when
calculating fees.
MS. KOENEMAN related that Sections 8-10, are technical changes,
not related to establishment of fees and Sections 11-26
reference the new language in Section 4. Section 27 would
change the word "assure" to "ensure" as a technical change.
Section 29 would remove a reference to AS 08.600.100(a), which
will be repealed. Sections 30-34 are also technical changes to
remove the reference to different types of fees as outlined
under AS 08.01.065. Section 35 would remove a dollar amount for
renewal penalty as this is defined under AS 08.01.065.
MS. KOENEMAN pointed out that Sections 36-43 would provide
additional technical changes. Section 44 would set out the 32
chapters that are repealed, noting members have a list in their
packets. Section 45 would provide transitional language to
allow the department to adopt regulations and Section 46 would
provide transitional language for current licensees. Section 45
would allow the department to adopt regulations immediately and
Section 48 would establish a January 1, 2014, effective date.
3:44:43 PM
REPRESENTATIVE SADDLER referred to Section 2, paragraph (2),
which would allow the department to establish fee levels. He
asked how far back the department can go when establishing fees.
MS. KOENEMAN answered that the department could look at three
biennial cycles or up to six years to establish the historical
cost of licensing fees.
3:46:06 PM
AL BARRETTE, Registered Class A Guide, stated that he holds a
professional license for hunting, fishing, and trapping as well
as a driver's license and two professional occupational
licenses. He related that he is self-employed as a class A
registered guide and owns a fur tannery which falls under
taxidermy licenses. He offered his belief that the system is
broken since licensees' fees are prorated to cover the cost of
investigations. He wondered why a licensee should be penalized
for investigations. He surmised that other boards and
commissions, such as the Board of Game of Board or Fish, make
regulations yet their investigation system falls under public
safety and not occupational licensing. He surmised Big Game
Commercial Services Board's laws were also prosecutable under
criminal law and he did not believe their costs were covered
under licensing.
CHAIR OLSON offered his belief that the general fund will
initially benefit from the provisions in HB 187. Additionally,
the Board of Fish and the Board of Game members are not making
their livelihood from the profession being regulated. He
recalled one profession consisting of 35-40 members had a
serious problem that resulted in investigation of one member
resulting in costs over $100,000. If licensing fees were spread
over these 35-40 members, it would have represented a
significant increase in their professional licensing fees. He
suggested the goal of HB 187 is to provide a balance and achieve
a more equitable system. He related that an investigation
involving one or two claims for realtors disrupted the entire
profession. In fact, some realtors were going to give up their
profession since they could not afford the fee increases.
This bill would offer a way for licensees or boards to pay their
own way, while avoiding putting people out of business.
MR. BARRETTE responded that some people who serve on the Board
of Fish and the Board of Game do have a personal interest [in
the fish or game].
CHAIR OLSON answered that he is not debating the issue, but
noted those board members must recuse themselves.
The committee took an at-ease from 3:50 p.m. to 4:01 p.m.
4:01:50 PM
KENNITH MCCARTY, President, American Association of Marriage and
Family Therapists - Alaska Division (AAMFT-AK); Member, Board of
Marriage and Family Therapists (BMFT), Department of Commerce,
Community & Economic Development (DCCED), related that he also
has a private practice in Eagle River as well as an office in
Kodiak. While he likes HB 187, he expressed concern about the
provision related to regulatory investigations and any fees
incurred. He explained that the BMFT has been affected by an
investigation that occurred 15 years ago, at which time the
Department of Law (DOL) provided a bill for an investigation to
the board for $250,000. That bill caused an increase in costs
in the marital and family therapists' licensing fees for over 15
years. He suggested the addition of a provision requiring every
marriage and family therapist obtain liability insurance with
the proviso to cover the state regulatory investigative fees.
He reported that other states have similar statutes and a major
insurance company, which is recognized by the Association of
Marriage & Family Therapists, the California Association of
Marriage & Family Therapists, psychologists, and licensed
clinical social workers, recognize it as a standard in liability
insurance. He pointed out that the burden would be placed on
the licensees and not the state, and thus the end result is that
the liability insurance of the licensee could be collected by
the state to pay for the regulatory fees and the other licensees
would not incur an increase in license fee because of that.
4:04:40 PM
CHAIR OLSON agreed this bill is similar to one that passed a
prior legislature, at the request of the real estate industry;
however, the language in HB 187 does not fall under the
insurance section of statutes so the topic would need to be in a
separate bill. He offered to meet with the Board of Marital &
Family Therapists to work on this issue next year.
MR. MCCARTY suggested the proposed language could be under AS
08.63.100, which could require liability insurance.
CHAIR OLSON answered that it is too close to the end of session
to consider adding liability insurance to HB 187. He offered to
meet during the legislative interim on this issue.
4:06:10 PM
CHAIR OLSON, after first determining no one else wished to
testify, closed public testimony on HB 187.
4:06:20 PM
REPRESENTATIVE REINBOLD moved to report HB 187 out of committee
with individual recommendations and the accompanying fiscal
note. There being no objection, HB 187 was reported from the
House Labor and Commerce Standing Committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB187 ver N.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB187 Sponsor Statement.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB187 Sectional Analysis.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB187 Supporting Documents-Letter to Boards-Commissions 03-26-13.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB187 Fiscal Note-DCCED-CBPL-03-29-13.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB187 Supporting Documents-Letter AARH 4-1-2013.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB187 Repealed Statutes (section 44-ver C).pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 187 |
| HB125 Fiscal Note-revised-DCCED-DOI-03-29-13.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 125 |
| HB125 Draft Proposed CS ver C.pdf |
HL&C 4/1/2013 3:15:00 PM |
HB 125 |