Legislature(2013 - 2014)BARNES 124

04/05/2013 03:15 PM LABOR & COMMERCE


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03:20:31 PM Start
03:21:13 PM Confirmation Hearings|| Regulatory Commission of Alaska|| Board of Marine Pilots|| Board of Pharmacy|| Alaska Workers' Compensation Board
03:35:37 PM HB32
03:46:35 PM HB150
04:08:27 PM SB52
04:21:03 PM HB121
04:36:18 PM HB152
05:00:21 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Confirmation Hearings: TELECONFERENCED
- Board of Marine Pilots
- Board of Pharmacy
- Alaska Workers' Compensation Board
- Regulatory Commission of Alaska
<Above Item Rescheduled from 3/29/13>
+= HB 32 LINES OF BUSINESS ON BUSINESS LICENSE TELECONFERENCED
Moved CSHB 32(L&C) Out of Committee
*+ HB 150 TECHNICAL/VOCATIONAL EDUCATION PROGRAM TELECONFERENCED
Moved CSHB 150(L&C) Out of Committee
+ SB 52 PORTABLE ELECTRONICS INSURANCE TELECONFERENCED
Moved HCS CSSB 52(L&C) Out of Committee
*+ HB 169 RCA REGULATION OF TELEPHONE DIRECTORIES TELECONFERENCED
<Bill Hearing Canceled>
*+ HB 121 COMMERCIAL FISHING & AGRICULTURE BANK TELECONFERENCED
Moved Out of Committee
*+ HB 152 PERS TERMINATION COSTS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                         April 5, 2013                                                                                          
                           3:20 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Lora Reinbold, Vice Chair                                                                                        
Representative Mike Chenault                                                                                                    
Representative Bob Herron                                                                                                       
Representative Charisse Millett                                                                                                 
Representative Dan Saddler                                                                                                      
Representative Andy Josephson                                                                                                   
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Kurt Olson, Chair                                                                                                
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
CONFIRMATION HEARING(S):                                                                                                        
                                                                                                                                
Regulatory Commission of Alaska                                                                                               
                                                                                                                                
     Norman Rokeberg - Anchorage                                                                                                
                                                                                                                                
Board of Marine Pilots                                                                                                        
                                                                                                                                
     Hans Antonsen - Ketchikan                                                                                                  
                                                                                                                                
Alaska Workers' Compensation Board                                                                                            
                                                                                                                                
     Ronald Nalikak - Anchorage                                                                                                 
                                                                                                                                
Board of Pharmacy                                                                                                             
                                                                                                                                
     Taryl Giessel - Eagle River                                                                                                
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
HOUSE BILL NO. 32                                                                                                               
"An Act providing for the issuance of one business license for                                                                  
multiple lines of business; and providing for reissuance of a                                                                   
business license to correct a mistake on the license."                                                                          
                                                                                                                                
     - MOVED CSHB 32(L&C) OUT OF COMMITTEE                                                                                      
                                                                                                                                
HOUSE BILL NO. 150                                                                                                              
"An Act  extending the unemployment contributions  for the Alaska                                                               
technical and vocational education program."                                                                                    
                                                                                                                                
     - MOVED CSHB 150(L&C) OUT OF COMMITTEE                                                                                     
                                                                                                                                
COMMITTEE SUBSTITUTE FOR SENATE BILL NO. 52(L&C)                                                                                
"An Act  providing that portable  electronics insurance is  not a                                                               
service   contract;  providing   that   a  portable   electronics                                                               
manufacturer's warranty or extended  warranty is not regulated as                                                               
insurance;   relating   to    portable   electronics   insurance;                                                               
authorizing  the  director  of   insurance  to  issue  a  limited                                                               
producer license  to a portable  electronics vendor for  the sale                                                               
of portable electronics insurance;  and relating to authorization                                                               
and  training of  employees and  representatives of  a vendor  to                                                               
transact  portable electronics  insurance; and  providing for  an                                                               
effective date."                                                                                                                
                                                                                                                                
     - MOVED HCS CSSB 52(L&C) OUT OF COMMITTEE                                                                                  
                                                                                                                                
HOUSE BILL NO. 121                                                                                                              
"An Act relating to the  examinations, board, loans, records, and                                                               
lobbying  contracts   of  the   Alaska  Commercial   Fishing  and                                                               
Agriculture Bank; and providing for an effective date."                                                                         
                                                                                                                                
     - MOVED HB 121 OUT OF COMMITTEE                                                                                            
                                                                                                                                
HOUSE BILL NO. 152                                                                                                              
"An Act  requiring certain employers who  terminate participation                                                               
in   the  defined   benefit  retirement   plan  or   the  defined                                                               
contribution retirement plan of  the Public Employees' Retirement                                                               
System to  make contributions related  to past  service liability                                                               
and  pay   termination  costs;   repealing  a   requirement  that                                                               
employers   who   terminate    participation   in   the   defined                                                               
contribution retirement  plan or  the defined  benefit retirement                                                               
plan  of  the  Public  Employees' Retirement  System  pay  for  a                                                               
termination cost study; and providing for an effective date."                                                                   
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 169                                                                                                              
"An Act  relating to the  authority of the  Regulatory Commission                                                               
of  Alaska  to  regulate  the   production  and  distribution  of                                                               
telephone directories."                                                                                                         
                                                                                                                                
     - BILL HEARING CANCELED                                                                                                    
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 32                                                                                                                   
SHORT TITLE: LINES OF BUSINESS ON BUSINESS LICENSE                                                                              
SPONSOR(s): REPRESENTATIVE(s) COSTELLO, HUGHES                                                                                  
                                                                                                                                
01/16/13       (H)       PREFILE RELEASED 1/7/13                                                                                
01/16/13       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/16/13       (H)       L&C, FIN                                                                                               
02/18/13       (H)       L&C AT 3:15 PM BARNES 124                                                                              
02/18/13       (H)       Heard & Held                                                                                           
02/18/13       (H)       MINUTE(L&C)                                                                                            
03/20/13       (H)       L&C AT 3:45 PM BARNES 124                                                                              
03/20/13       (H)       Scheduled But Not Heard                                                                                
04/03/13       (H)       L&C AT 3:15 PM CAPITOL 106                                                                             
04/03/13       (H)       -- MEETING CANCELED --                                                                                 
04/05/13       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 150                                                                                                                  
SHORT TITLE: TECHNICAL/VOCATIONAL EDUCATION PROGRAM                                                                             
SPONSOR(s): REPRESENTATIVE(s) NEUMAN                                                                                            
                                                                                                                                
03/01/13       (H)       READ THE FIRST TIME - REFERRALS                                                                        
03/01/13       (H)       L&C, FIN                                                                                               
04/03/13       (H)       L&C AT 3:15 PM CAPITOL 106                                                                             
04/03/13       (H)       -- MEETING CANCELED --                                                                                 
04/05/13       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: SB 52                                                                                                                   
SHORT TITLE: PORTABLE ELECTRONICS INSURANCE                                                                                     
SPONSOR(s): SENATOR(s) COGHILL                                                                                                  
                                                                                                                                
02/13/13       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/13/13       (S)       L&C                                                                                                    
02/26/13       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
02/26/13       (S)       Heard & Held                                                                                           
02/26/13       (S)       MINUTE(L&C)                                                                                            
03/21/13       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/21/13       (S)       Moved CSSB  52(L&C) Out of Committee                                                                   
03/21/13       (S)       MINUTE(L&C)                                                                                            
03/25/13       (S)       L&C RPT CS  1DP 4NR  NEW TITLE                                                                         
03/25/13       (S)       DP: DUNLEAVY                                                                                           
03/25/13       (S)       NR: OLSON, MICCICHE, STEDMAN, ELLIS                                                                    
04/02/13       (S)       TRANSMITTED TO (H)                                                                                     
04/02/13       (S)       VERSION: CSSB 52(L&C)                                                                                  
04/03/13       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/03/13       (H)       L&C                                                                                                    
04/05/13       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 121                                                                                                                  
SHORT TITLE: COMMERCIAL FISHING & AGRICULTURE BANK                                                                              
SPONSOR(s): REPRESENTATIVE(s) FEIGE                                                                                             
                                                                                                                                
02/15/13       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/15/13       (H)       L&C, FIN                                                                                               
04/05/13       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 152                                                                                                                  
SHORT TITLE: PERS TERMINATION COSTS                                                                                             
SPONSOR(s): REPRESENTATIVE(s) THOMPSON                                                                                          
                                                                                                                                
03/04/13       (H)       READ THE FIRST TIME - REFERRALS                                                                        
03/04/13       (H)       L&C, FIN                                                                                               
04/05/13       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
NORMAN ROKEBERG, Appointee                                                                                                      
Regulatory Commission of Alaska                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  As appointee to the Regulatory Commission                                                                
of Alaska, testified during the confirmation hearing.                                                                           
                                                                                                                                
KONRAD JACKSON, Staff                                                                                                           
Representative Kurt Olson                                                                                                       
Chair, House Labor & Commerce Committee                                                                                         
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  During the confirmation hearing, testified                                                               
on behalf of the House Labor & Commerce Committee, chaired by                                                                   
Representative Kurt Olson, for which he is staff.                                                                               
                                                                                                                                
MARY SCHLOSSER, Staff                                                                                                           
Representative Mia Costello                                                                                                     
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  On behalf of Representative Costello, joint                                                              
prime sponsor of HB 32, answered questions and outlined the                                                                     
changes in the proposed committee substitute (CS), Version Y.                                                                   
                                                                                                                                
DON HABEGER, Director                                                                                                           
Division of Corporations, Business & Professional Licensing                                                                     
(DCBPL)                                                                                                                         
Department of Commerce, Community & Economic Development (DCCED)                                                                
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions  during the discussion of                                                             
HB 32.                                                                                                                          
                                                                                                                                
REPRESENTATIVE SHELLY HUGHES                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Testified and answered questions  as one of                                                             
the joint prime sponsors of HB 32.                                                                                              
                                                                                                                                
CATHY TILTON, Staff                                                                                                             
Representative Mark Neuman                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Testified  on behalf of  the sponsor  of HB                                                             
150, Representative Mark Neuman.                                                                                                
                                                                                                                                
REPRESENTATIVE MARK NEUMAN                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified and  answered questions as sponsor                                                             
of HB 150.                                                                                                                      
                                                                                                                                
KONRAD JACKSON, Staff                                                                                                           
Representative Kurt Olson                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   On behalf  of the  House Labor  & Commerce                                                             
Committee, which Representative Kurt  Olson chairs, explained the                                                               
changes in  the proposed  committee substitute  (CS) for  HB 150,                                                               
Version N.                                                                                                                      
                                                                                                                                
JUDY WALGENBACH, Program Director                                                                                               
Amundsen Education Center/New Frontier Vo-Tech Center                                                                           
Soldotna, Alaska                                                                                                                
POSITION STATEMENT:  Testified during the discussion of HB 150.                                                               
                                                                                                                                
CHRIS REITAN, Superintendent                                                                                                    
Galena School District (GSD)                                                                                                    
Galena, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in support of HB 150.                                                                          
                                                                                                                                
FRED VILLA, Associate Vice-President                                                                                            
Workforce Programs                                                                                                              
University of Alaska Fairbanks (UAF)                                                                                            
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 150.                                                                          
                                                                                                                                
RYNNIEVA MOSS, Staff                                                                                                            
Senator John Coghill                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified on behalf of Senator Coghill,                                                                  
prime sponsor of SB 52.                                                                                                         
                                                                                                                                
KARI NORE, Intern                                                                                                               
Senator John Coghill                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified on behalf of Senator Coghill,                                                                  
prime sponsor of SB 52.                                                                                                         
                                                                                                                                
STEPHEN MCDANIEL                                                                                                                
Asurion Wireless Insurance                                                                                                      
Tallahassee, Florida                                                                                                            
POSITION STATEMENT:  Testified during the discussion of SB 52.                                                                
                                                                                                                                
MICHAEL PASCHALL, Staff                                                                                                         
Representative Eric Feige                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified on behalf of Representative Eric                                                               
Feige, sponsor of HB 121.                                                                                                       
                                                                                                                                
LELA KLINGERT, President                                                                                                        
Alaska Commercial Fishing and Agriculture Bank (CFAB)                                                                           
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 121.                                                               
                                                                                                                                
JANE W. PIERSON, Staff                                                                                                          
Representative Steve Thompson                                                                                                   
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified on behalf of Representative Steve                                                              
Thompson, sponsor of HB 152.                                                                                                    
                                                                                                                                
LUCINDA MAHONEY, Chief Fiscal Officer (CFO)                                                                                     
Municipality of Anchorage (MOA)                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 152.                                                               
                                                                                                                                
LUKE HOPKINS, Mayor                                                                                                             
Fairbanks North Star Borough (FNSB)                                                                                             
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 152.                                                                          
                                                                                                                                
SALLIE STUVEK, Director                                                                                                         
Human Resources                                                                                                                 
Fairbanks North Star Borough (FNSB)                                                                                             
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 152.                                                                          
                                                                                                                                
KATHIE WASSERMAN, Executive Director                                                                                            
Alaska Municipal League (AML)                                                                                                   
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in support of HB 152.                                                                          
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:20:31 PM                                                                                                                    
                                                                                                                                
VICE  CHAIR LORA  REINBOLD called  the House  Labor and  Commerce                                                             
Standing   Committee    meeting   to    order   at    3:20   p.m.                                                               
Representatives  Josephson, Saddler,  Herron,  and Reinbold  were                                                               
present  at the  call  to order.    Representatives Chenault  and                                                               
Millett arrived as the meeting was in progress.                                                                                 
                                                                                                                                
^Confirmation Hearings                                                                                                          
^Regulatory Commission of Alaska                                                                                                
^Board of Marine Pilots                                                                                                         
^Board of Pharmacy                                                                                                              
^Alaska Workers' Compensation Board                                                                                             
                    CONFIRMATION HEARING(S):                                                                                
                Regulatory Commission of Alaska                                                                             
                     Board of Marine Pilots                                                                                 
                       Board of Pharmacy                                                                                    
               Alaska Workers' Compensation Board                                                                           
                                                                                                                                
3:21:13 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD announced that  the first order  of business                                                               
would be  confirmation hearings for the  Regulatory Commission of                                                               
Alaska,  Board  of Marine  Pilots,  Board  of Pharmacy,  and  the                                                               
Alaska Workers' Compensation Board.                                                                                             
                                                                                                                                
3:22:04 PM                                                                                                                    
                                                                                                                                
NORMAN  ROKEBERG,  Appointee,  Regulatory  Commission  of  Alaska                                                               
(RCA), stated that  his primary goal as a member  of the RCA will                                                               
be to  make an immediate and  lasting contribution to the  RCA by                                                               
bringing his experience working in  the private sector as a small                                                               
businessman in Alaska for 40 years,  as a state legislator for 12                                                               
years,  and his  reputation and  conduct as  a lifelong  Alaskan.                                                               
The  RCA impacts  each  Alaskan  every day  of  their lives  with                                                               
oversight of its infrastructure, he said.                                                                                       
                                                                                                                                
3:23:26 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  recalled a bill before  the legislature                                                               
that would create  a small diameter gasline from  the North Slope                                                               
to Nikiski that  would change some of the oversight  for the RCA.                                                               
He asked whether Mr. Rokeberg has a position on this.                                                                           
                                                                                                                                
MR. ROKEBERG answered  that this project is a  major issue before                                                               
the state.  He  currently is and will continue to  be a member of                                                               
the RCA,  [if confirmed] and as  such is not at  liberty to speak                                                               
to any issues  that will come before  the RCA.  In  fact, the RCA                                                               
has been monitoring  the pending legislation, HB 4,  and while he                                                               
can't speak  for the commission,  he offered his belief  that the                                                               
RCA  has a  role  in the  oversight of  all  pipelines under  its                                                               
current statutory  regime, which  will continue with  the pending                                                               
bill.  He  said the nature of a contract  carrier would represent                                                               
a new  concept in Alaska;  however the Federal  Energy Regulatory                                                               
Commission (FERC) oversees contracts in the Lower 48.                                                                           
                                                                                                                                
3:25:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON recalled  as a  former legislator,  Mr.                                                               
Rokeberg  twice  sponsored  legislation  to  create  an  electric                                                               
consumer's bill of rights.  He asked if those bills passed.                                                                     
                                                                                                                                
MR. ROKEBERG answered no; however,  he did introduce a consumer's                                                               
bill of rights for health insurance  that passed, but not one for                                                               
utility customers.                                                                                                              
                                                                                                                                
3:25:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON, recalling  that  as  a legislator  Mr.                                                               
Rokeberg  was focused  on utility  regulation legislation,  asked                                                               
Mr. Rokeberg to discuss his philosophy of regulation.                                                                           
                                                                                                                                
MR. ROKEBERG replied  that the purpose of regulation  is to align                                                               
private  and in  Alaska's case,  the service  providers' behavior                                                               
with the public interest.  The  public interest is a composite of                                                               
the  economic efficiency,  political  accountability, and  public                                                               
expectations of  fairness and  problem solving.   In  essence, he                                                               
said   that  is   basically  his   understanding  of   regulatory                                                               
oversight.   Recently,  part of  his  daily routine  has been  to                                                               
become   educated  on   RCA  matters   since   the  position   of                                                               
commissioner is very demanding and complex.                                                                                     
                                                                                                                                
3:27:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER inquired  as to  what special  skills Mr.                                                               
Rokeberg  will bring  to the  job, which  gaps he  will fill,  or                                                               
places that he will provide complementary skills.                                                                               
                                                                                                                                
MR. ROKEBERG answered the current RCA  is comprised of a group of                                                               
people  possessing  strong  leadership.    He  characterized  the                                                               
commissioners as people  with sharp minds and  an excellent legal                                                               
background.  He  offered his belief that he  will bring long-term                                                               
experience in the private sector  due to his business background.                                                               
He  noted  that  he  had  a  successful  career  in  real  estate                                                               
brokerage  and  development  and  also served  12  years  in  the                                                               
legislature  where  he focused  in  the  House Labor  &  Commerce                                                               
Standing  Committee on  many utility  issues.   He  said he  also                                                               
chaired  working groups  on the  Railbelt  Energy Grid  Authority                                                               
hearings through the  Alaska Power Authority (APA) as  well as on                                                               
the  Integrated  Regional Plan  after  he  left the  legislature.                                                               
Thus,  he  has kept  abreast  of  issues  and  been part  of  the                                                               
solution.   He acknowledged the legislature  is currently seeking                                                               
to resolve major challenges.                                                                                                    
                                                                                                                                
3:28:44 PM                                                                                                                    
                                                                                                                                
VICE CHAIR REINBOLD asked about the composition of the RCA.                                                                     
                                                                                                                                
MR.  ROKEBERG answered  that  three lawyers  and  members of  the                                                               
Alaska Bar Association  serve on the RCA.  He  said that although                                                               
he and Commissioner Pickett are  the non-lawyers on the RCA, they                                                               
both have private  and public experience and a  broad spectrum of                                                               
experience.  He  also did not mind  - if the Vice  Chair so chose                                                               
to do so  - being called the honorific  "Representative" since he                                                               
is very proud of his service in the legislature.                                                                                
                                                                                                                                
3:29:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  commended Mr.  Rokeberg for  putting his                                                               
name  forward  as  he  brings a  diverse  background  beyond  the                                                               
lawyers.  He said he will support him.                                                                                          
                                                                                                                                
MR. ROKEBERG  appreciated that  his law-making  experience versus                                                               
being an  attorney brings  a different  perspective to  his role.                                                               
He said  he is  pleased the  governor has  confidence in  him and                                                               
with Representative Chenault's support.                                                                                         
                                                                                                                                
3:31:19 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  related that  the legislature  will deal                                                               
with the policy issues and the RCA can handle the RCA's issues.                                                                 
                                                                                                                                
MR. ROKEBERG answered that is a point well taken.                                                                               
                                                                                                                                
3:31:35 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD thanked him  for service to  the legislature                                                               
and for  being willing to  serve [on the RCA].   As chair  of the                                                               
Joint  Committee on  Administrative Regulation  Review Committee,                                                               
Vice   Chair  Reinbold   said  she   looks   forward  to   better                                                               
understanding   the  process   and  expressed   hope  that   some                                                               
improvements could be made.                                                                                                     
                                                                                                                                
3:32:17 PM                                                                                                                    
                                                                                                                                
KONRAD JACKSON,  Staff, Representative  Kurt Olson,  Chair, House                                                               
Labor &  Commerce Standing  Committee, Alaska  State Legislature,                                                               
on  behalf of  the  House Labor  &  Commerce Standing  Committee,                                                               
referred  to a  draft memorandum  dated April  5, 2013,  from the                                                               
committee  to the  Chief  Clerk listing  the  appointees and  the                                                               
board or commission  to which they have been appointed.   He said                                                               
that  all of  the committee  members have  had an  opportunity to                                                               
review the  resumes and have  expressed no further  concerns with                                                               
the  qualifications  of any  of  the  appointees.   He  read  the                                                               
following   names   of   the   appointee's   to   the   specified                                                               
board/commission:                                                                                                               
                                                                                                                                
     Board of Marine Pilots                                                                                                   
     Hans Antonsen                                                                                                              
                                                                                                                                
     Alaska Workers' Compensation Board                                                                                       
     Ronald Nalikak                                                                                                             
                                                                                                                                
     Board of Pharmacy                                                                                                        
     Taryl Giessel                                                                                                              
                                                                                                                                
     Regulatory Commission of Alaska                                                                                          
     Norman Rokeberg                                                                                                            
                                                                                                                                
MR. JACKSON  reminded members that signing  the reports regarding                                                               
appointments  to  boards  and  commissions   in  no  way  reflect                                                               
individual members'  approval or  disapproval of  the appointees,                                                               
and  that  the  nominations  are merely  forwarded  to  the  full                                                               
legislature for confirmation or rejection.                                                                                      
                                                                                                                                
VICE CHAIR REINBOLD,  after first determining no  one else wished                                                               
to testify, closed public testimony on the confirmation hearing.                                                                
                                                                                                                                
3:34:12 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  moved to  advance the  confirmations for                                                               
the  aforementioned  named  appointees referred  from  the  House                                                               
Labor and  Commerce Standing  Committee to  the joint  session of                                                               
the  House and  Senate for  consideration.   [He noted  that each                                                               
member's signature on  the committee's report in  no way reflects                                                               
the member's vote  during the joint floor session].   There being                                                               
no objection, the confirmations were advanced.                                                                                  
                                                                                                                                
The committee took an at-ease from 3:34 p.m. to 3:35 p.m.                                                                       
                                                                                                                                
          HB 32-LINES OF BUSINESS ON BUSINESS LICENSE                                                                       
                                                                                                                                
3:35:37 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD announced  that the  next order  of business                                                               
would be HOUSE BILL NO. 32  "An Act providing for the issuance of                                                               
one  business  license  for  multiple   lines  of  business;  and                                                               
providing  for reissuance  of  a business  license  to correct  a                                                               
mistake on the license."                                                                                                        
                                                                                                                                
3:35:51 PM                                                                                                                    
                                                                                                                                
MARY SCHLOSSER, Staff, Representative  Mia Costello, Alaska State                                                               
Legislature,  speaking  on  behalf  of one  of  the  joint  prime                                                               
sponsors  of HB  32, Representative  Costello, stated  that under                                                               
current  law a  separate business  license is  required for  each                                                               
line of  business or  business activity.   This bill  would allow                                                               
companies  with multiple  lines of  business to  obtain only  one                                                               
business   license  for   their   operations.     After   further                                                               
consultation with  the department, the sponsor  agreed to changes                                                               
embodied   in  the   proposed  committee   substitute,  including                                                               
changing the lines of business  to trade, service, profession, or                                                               
activity throughout the bill, she said.                                                                                         
                                                                                                                                
3:36:53 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CHENAULT moved  to adopt  the proposed  committee                                                               
substitute (CS) for HB 32,  labeled 28-LS0192/Y, Martin, 3/19/13,                                                               
as the  working document.   There being  no objection,  Version Y                                                               
was before the committee.                                                                                                       
                                                                                                                                
3:37:22 PM                                                                                                                    
                                                                                                                                
MS. SCHLOSSER,  continuing her review  of Version Y,  pointed out                                                               
that on  page 1,  line 13, the  language, "primary  and secondary                                                               
trade,  service, profession,  or  activity" was  inserted.   This                                                               
language, she explained,  was crucial to the  department to lower                                                               
the fiscal note.   On page 2, line 8, a  new subsection was added                                                               
to  allow reissuance  of a  business  license without  additional                                                               
fees.   Additionally, on page  2, line  13, the grace  period for                                                               
the timeframe in  which the department retains  the business name                                                               
in  the  database was  shortened  from  the 90-day  grace  period                                                               
previously considered  to 30 days.   This  goal of the  bill, she                                                               
specified, is to make it  possible to license the business rather                                                               
than limit  it to the line  of business.  She  characterized this                                                               
bill as  a business-friendly  bill as the  sponsor wants  to make                                                               
Alaska friendly to business.   She suggested this bill might help                                                               
Alaska's  rankings in  terms of  business-friendly  states.   She                                                               
reminded members  of a CNBC poll  that ranked Alaska 47th  out of                                                               
50 and a Forbes poll that ranked Alaska as 42nd in the nation.                                                                
                                                                                                                                
VICE CHAIR REINBOLD objected for the purpose of discussion.                                                                     
                                                                                                                                
3:39:29 PM                                                                                                                    
                                                                                                                                
DON HABEGER,  Director, Division  of Corporations,  Business, and                                                               
Professional   Licensing   (DCBPL),   Department   of   Commerce,                                                               
Community, &  Economic Development  (DCCED), said  he appreciated                                                               
the sponsor's willingness to work through the issues.                                                                           
                                                                                                                                
3:40:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  referred to the fiscal  note and reasons                                                               
the fiscal note  changed, including that the  department wants to                                                               
be  able to  capture the  old business  licenses.   He asked  for                                                               
clarification on the specific change in the fiscal note.                                                                        
                                                                                                                                
MR. HABEGER responded  that one of the big drivers  is the amount                                                               
of data  the database can handle.   The original bill  would have                                                               
required  the  department  to  maintain  a  number  of  lines  of                                                               
business.   He recalled the maximum  number is about 11  lines of                                                               
business  with   subcategories  under  it.     He  suggested  the                                                               
recording and  tracking was rather burdensome  and the department                                                               
anticipated increased  costs to maintain the  database.  However,                                                               
once  the requirement  to track  was limited  to the  primary and                                                               
secondary  business,   which  is  subsequently  printed   on  the                                                               
license,  it  reduced  the  effort   necessary  to  maintain  the                                                               
database and  the department could  accommodate the needs  of the                                                               
statute.                                                                                                                        
                                                                                                                                
3:41:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  said he supports  this bill.   He asked                                                               
whether the cost would be under $10,000.                                                                                        
                                                                                                                                
MR.  HABEGER answered  yes.   While  the proposed  CS will  still                                                               
require some  changes to the  database, the division  already has                                                               
the  primary and  secondary  methodology in  place  to track  the                                                               
information.   These changes  are not  as cumbersome  as tracking                                                               
multiple lines of business, which  he has been advised include up                                                               
to 19  lines of business.   He concluded that using  the tracking                                                               
currently in place will reduce the cost to implement the bill.                                                                  
                                                                                                                                
3:42:40 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SHELLY HUGHES,  Alaska  State  Legislature, as  a                                                               
prime joint  sponsor of  HB 32,  offered her  support for  HB 32.                                                               
She  said that  it is  important to  streamline the  process such                                                               
that one business  name and one business license  makes sense, in                                                               
particular for the small business  owner who has limited margins.                                                               
Hence, if the state can help  by allowing them to put their money                                                               
into expanding their businesses  rather than paying license fees,                                                               
then this is a good thing.                                                                                                      
                                                                                                                                
3:43:53 PM                                                                                                                    
                                                                                                                                
VICE CHAIR REINBOLD,  after first determining no  one else wished                                                               
to testify, closed public testimony on HB 32.                                                                                   
                                                                                                                                
VICE CHAIR REINBOLD removed her objection.                                                                                      
                                                                                                                                
3:44:10 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  moved to  report the  proposed committee                                                               
substitute (CS) for HB 32,  labeled 28-LS0192\Y, Martin, 3/19/13,                                                               
out  of   committee  with  individual  recommendations   and  the                                                               
accompanying fiscal  note and letter  of intent.  There  being no                                                               
objection, CSHB  32(L&C) was  reported from  the House  Labor and                                                               
Commerce Standing Committee.                                                                                                    
                                                                                                                                
The committee took an at-ease from 3:44 p.m. to 3:46 p.m.                                                                       
                                                                                                                                
         HB 150-TECHNICAL/VOCATIONAL EDUCATION PROGRAM                                                                      
                                                                                                                                
3:46:35 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD announced  that the  next order  of business                                                               
would be  HOUSE BILL NO.  150 "An Act extending  the unemployment                                                               
contributions for  the Alaska technical and  vocational education                                                               
program."                                                                                                                       
                                                                                                                                
3:46:42 PM                                                                                                                    
                                                                                                                                
CATHY  TILTON, Staff,  Representative Mark  Neuman, Alaska  State                                                               
Legislature, speaking  on behalf  of the  sponsor, Representative                                                               
Neuman, explained  that HB  150 relates  to the  Alaska Technical                                                               
and  Vocational Education  Program (TVEP),  which was  created in                                                               
2000 under AS 23.15.840 and sunsets  on June 30, 2014.  This bill                                                               
will extend  the sunset date.   The  TVEP was created  to provide                                                               
financial assistance and support  facilities throughout the state                                                               
for  technical  and  educational programs  for  industry-specific                                                               
training.      In 2008, a  bill passed that  updated the  TVEP by                                                               
creating  a  vocational  education  account  comprised  of  funds                                                               
collected from unemployment insurance  contributions at a rate of                                                               
.15 percent.   These  funds are then  allocated according  to the                                                               
statute,  which  is  illustrated  in a  flow  chart  in  members'                                                               
packets entitled,  "State of  Alaska Tax Flow  Chart".   In 2008,                                                               
the  unemployment  rate  in  Alaska  was  50  percent  above  the                                                               
national  average.    Figures  recently  released  by  the  state                                                               
Department of  Labor & Workforce Development  (DLWD), relate that                                                               
the  unemployment rate  in Alaska  for December  2012 was  at 6.6                                                               
percent,  while the  national average  was  at 8.1  percent.   In                                                               
fact, Alaska  has maintained a  lower than national  average rate                                                               
for 46 months,  which is a good indicator that  the technical and                                                               
vocational training  programs work.   From 2006-2011,  63 percent                                                               
of youth who  graduated from Alaska's high  schools attended some                                                               
college.  In  part, the TVEP program works since  it allows youth                                                               
to train in their local communities  and also live and work where                                                               
they were raised.   In 2012, DLWD tracked  nearly 18,000 training                                                               
program  students  as  they  moved  into the  work  force.    The                                                               
department  discovered  that  67  percent  of  the  students  who                                                               
completed the program  had salaries and employment  in the fourth                                                               
quarter.   Additionally,  these  participants  earned 29  percent                                                               
more during that time [as compared to those not in the program].                                                                
                                                                                                                                
3:49:16 PM                                                                                                                    
                                                                                                                                
MS. TILTON pointed out Alaska's  workforce is an aging workforce.                                                               
As  the  baby  boomers  retire  a lack  of  skilled  workers  and                                                               
tradesmen exist to meet the  growing demand for replacements.  In                                                               
2008, 9.9  percent of  construction workers  and 11.8  percent of                                                               
mining and  logging workers were between  the ages of 55-65.   As                                                               
this group retires the state  will need skilled tradesmen to fill                                                               
their spots.   The Anchorage Daily News (ADN) on  March 21, 2013,                                                             
reported that the U.S. is  not producing enough qualified workers                                                               
to meet  the needs  of the  mining and  energy sectors,  which is                                                               
another  reason  to  continue  with  these  vocational  education                                                               
training programs.                                                                                                              
                                                                                                                                
REPRESENTATIVE  MARK NEUMAN,  Alaska State  Legislature, speaking                                                               
as the  sponsor of HB  150, stated that  this is a  great program                                                               
with federal funds  for vocational education programs.   He asked                                                               
members for their support.                                                                                                      
                                                                                                                                
3:50:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER moved  to  adopt  the proposed  committee                                                               
substitute  (CS)  for  HB   150,  labeled  28-LS0599\N,  Mischel,                                                               
4/4/13, as the working document.                                                                                                
                                                                                                                                
VICE CHAIR REINBOLD objected for the purpose of discussion.                                                                     
                                                                                                                                
3:51:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER asked  the sponsor  to identify  the most                                                               
effective vocational education training program.                                                                                
                                                                                                                                
REPRESENTATIVE NEUMAN  replied it would depend  on the university                                                               
or job  skills a student would  like to pursue.   He related that                                                               
this program funds a multitude  of vocational education programs,                                                               
such   as  nursing,   mining,   heavy  equipment,   construction,                                                               
electricity, and almost every trade.                                                                                            
                                                                                                                                
3:51:50 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD referred  to the fiscal  note and  asked for                                                               
clarification.                                                                                                                  
                                                                                                                                
REPRESENTATIVE  NEUMAN  directed  attention  to  the  explanation                                                               
attached to the $5.4 million fiscal  note.  He then explained the                                                               
fiscal  note is  an estimate  since the  state is  unsure of  the                                                               
amount of the program's funding.                                                                                                
                                                                                                                                
VICE  CHAIR REINBOLD  asked whether  the  fiscal note  represents                                                               
growth or if the program has been steady.                                                                                       
                                                                                                                                
REPRESENTATIVE NEUMAN  answered that the program  has been fairly                                                               
steady.   Unfortunately, as less  people are working,  less money                                                               
goes into this program.   He explained the program increased from                                                               
approximately .10-.15 percent six years  ago once the core of the                                                               
fund  had  grown to  a  point  where  additional funds  could  be                                                               
distributed for vocational education without affecting the core.                                                                
                                                                                                                                
3:53:35 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CHENAULT  commented  that he  supports  workforce                                                               
development and vocational  education training.    He wondered if                                                               
some  of the  funds  should be  spent in  K-12  or if  additional                                                               
funding should  be applied to the  K-12 sector.  He  expressed an                                                               
interest  in  having  high school  students  consider  vocational                                                               
education as an option rather  than waiting until students are of                                                               
college age.  He said he likes  the bill, but he thinks the state                                                               
needs to  do more in the  education system at an  earlier time to                                                               
promote vocational education.                                                                                                   
                                                                                                                                
VICE  CHAIR REINBOLD  stated she  previously lived  in a  country                                                               
that promoted vocational education and  it was fascinating to see                                                               
kids choose a college path or vocational path in 9th grade.                                                                     
                                                                                                                                
3:54:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  asked for an explanation  of the changes                                                               
in the proposed committee substitute (CS) for HB 150, Version N.                                                                
                                                                                                                                
KONRAD JACKSON,  Staff, Representative  Kurt Olson,  Alaska State                                                               
Legislature, on  behalf of  the House  Labor &  Commerce Standing                                                               
Committee,  Representative  Kurt   Olson,  Chair,  explained  the                                                               
changes in  Version N.   Referring to page  1 line 6,  he pointed                                                               
out that the  immediate effective date would change  from 2014 to                                                               
2024 to help prevent any lapse in funding for the funding.                                                                      
                                                                                                                                
REPRESENTATIVE  NEUMAN  interjected  that he  wanted  to  address                                                               
HB 150 this year to avoid any lapse in funding.                                                                                 
                                                                                                                                
VICE  CHAIR   REINBOLD  removed  her  objection.     [No  further                                                               
objection  was stated  and  the committee  treated  Version N  as                                                               
before it.]                                                                                                                     
                                                                                                                                
3:56:12 PM                                                                                                                    
                                                                                                                                
JUDY WALGENBACH, Program  Director, Amundsen Education Center/New                                                               
Frontier Vo-Tech  Center, began by  thanking the members  for the                                                               
TVEP  funding, which  allowed  expansion of  the  programs.   For                                                               
instance, now there  is a professional medical  coding program on                                                               
the peninsula,  which is a  national certification.   The average                                                               
salary  students  receive  ranges  from  $13-$15  per  hour  with                                                               
benefits.   She then  pointed out that  the Alaska  Commission on                                                               
Post-Secondary  Education just  approved  an Internet  Technology                                                               
network  technician  program  which  will  allow  the  center  to                                                               
attract  more  students  from  the  village.    The  center  also                                                               
provides support  to assist students  as they transition  in from                                                               
the  villages to  the program;  the center  hopes to  obtain more                                                               
residential housing for  students.  She indicated  the center has                                                               
been assisting students seeking new  careers.  A new facility was                                                               
donated to Amundsen  Education Center this fall  and TVEP enabled                                                               
the  center to  have adequate  teaching staff  as it  expands its                                                               
program.   She reported the TVEP  grant has been a  great benefit                                                               
to the  organization and the  center appreciated being  awarded a                                                               
grant to cover operating expenses.                                                                                              
                                                                                                                                
VICE CHAIR REINBOLD remarked that  she understood that the number                                                               
of medical codes will increase  from 10,000 to over 100,000 under                                                               
the [new proposed] federal law.                                                                                                 
                                                                                                                                
3:58:17 PM                                                                                                                    
                                                                                                                                
CHRIS  REITAN,  Superintendent,  Galena  School  District  (GSD),                                                               
spoke in support of  HB 150.  He explained that  the GSD uses the                                                               
TVEP  funding to  build  a bridge  program,  primarily for  rural                                                               
Alaska  Native students,  for  long-term post-secondary  training                                                               
opportunities.  The  GSD has a high school  boarding school where                                                               
students  are  engaged  in  one   of  the  career  and  technical                                                               
education  programs.   Further,  students can  transition into  a                                                               
post-secondary program.  For example,  the TVEP funds support the                                                               
GSD's  aviation program  and students  can transition  and obtain                                                               
their private  pilot's license and  instrumentation certification                                                               
in Galena,  and then  move on  to more  advanced training  at the                                                               
university  level.    Additionally,   students  can  work  toward                                                               
cosmetology certification, primarily at  the high school level to                                                               
obtain hours and  then transition into Galena's  fifth year post-                                                               
secondary program.   These TVEP funds have  been hugely important                                                               
to  Galena,  in  terms  of building  programs  that  high  school                                                               
students can  use to begin  working towards certification.   Upon                                                               
graduation  students can  move into  post-secondary certification                                                               
programs, which  are relatively short-term  programs [due  to the                                                               
vocational technical training  they receive in Galena].   He said                                                               
GSD is  in full support  of HB 150.   He offered his  belief that                                                               
this funding has  created a great model in Galena  to offer post-                                                               
secondary education  and training to high  school students, which                                                               
allows them to move on to final certification upon graduation.                                                                  
                                                                                                                                
REPRESENTATIVE SADDLER remarked  that he was part of  a trip that                                                               
the Community  and Regional Affairs Standing  Committee took last                                                               
year to Galena.   He said he was very impressed  by the auto shop                                                               
and aviation technology program.   He offered his support for the                                                               
bill, in part, to assist Galena in its continued efforts.                                                                       
                                                                                                                                
4:01:07 PM                                                                                                                    
                                                                                                                                
FRED   VILLA,  Associate   Vice-President,  Workforce   Programs,                                                               
University of  Alaska Fairbanks (UAF),  stated that UAF  has over                                                               
200  workforce development  programs  in  three areas,  including                                                               
pre-college programs  to connect youth with  career pathways; the                                                               
certificate  degree  and  occupational endorsement;  as  well  as                                                               
professional  development  of  students  across  the  state  with                                                               
priority  areas for  economic and  community development,  career                                                               
pathways, and high demand jobs.   He related that the UAF program                                                               
uses  the  TVEP  money  as  one-time  funds  to  keep  technology                                                               
current,  startup  funds for  programs  that  meet the  immediate                                                               
needs of  employers in the  regions and across the  state through                                                               
grants or  other resources until  sustainable sources  of funding                                                               
are  found.     The  office   implements  the  program   using  a                                                               
comparative  process with  the  university  campuses that  aligns                                                               
with  the  state  priorities  as   identified  by  the  Workforce                                                               
Investment  Board and  use  the TVEP's  rules  and guidelines  to                                                               
develop proposals.   Then  the proposals  are vetted  through the                                                               
provost and  the chief  academic officers  of each  university to                                                               
ensure  the  program meets  the  campus  priorities.   The  UAF's                                                               
review  committee includes  representatives from  each university                                                               
and the Department  of Labor & Workforce Development  (DLWD).  He                                                               
characterized this effort as one  that uses the state perspective                                                               
to help prevent duplication of programs.                                                                                        
                                                                                                                                
4:03:38 PM                                                                                                                    
                                                                                                                                
MR.  VILLA  offered  his  belief  that  all  of  the  educational                                                               
training  programs are  associated  with  industry standards  and                                                               
criteria or certificates.  For  example, in the pre-college area,                                                               
the robotics  program has gone  statewide and is almost  viral at                                                               
this point.   The  robotics program helps  introduce kids  to the                                                               
fun and  creativity of robotics,  but may also  generate interest                                                               
in more students  becoming engineers.  The  dual credit tech-prep                                                               
program    and    the   professional    development    journeyman                                                               
apprenticeship  program  allows  credit for  prior  learning  for                                                               
associate degrees  by using  experience students  obtained during                                                               
the journeyman training.   He pointed out that  high demand areas                                                               
are  programs  in health,  mining,  and  a mining  core  drilling                                                               
program  - which  is an  apprenticeship  program.   The new  mine                                                               
training offered  in Juneau and  in the  oil and gas  sectors are                                                               
process  technology provided  in  partnership  with the  Pipeline                                                               
Training Center.   He  offered his belief  that this  funding has                                                               
been  critical funding  and wisely  used by  the university.   He                                                               
thanked members for their time.                                                                                                 
                                                                                                                                
VICE  CHAIR REINBOLD  remarked that  the  robotics programs  have                                                               
just started  at the high school  in her district.   She said she                                                               
also loves the science, technology,  engineering, and math (STEM)                                                               
program, as well.   She said after listening to  the testimony on                                                               
workforce development,  she believes the philosophy  and training                                                               
is aligned with the needs of Alaskans.                                                                                          
                                                                                                                                
VICE CHAIR REINBOLD,  after first determining no  one else wished                                                               
to testify, closed public testimony on HB 150.                                                                                  
                                                                                                                                
4:05:54 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER moved  the proposed  committee substitute                                                               
(CS) for  HB 150, labeled  28-LS0599\N, Mischel, 4/14/13,  out of                                                               
committee  with individual  recommendations and  the accompanying                                                               
fiscal  notes.   There  being  no  objection, CSHB  150(L&C)  was                                                               
reported from the House Labor and Commerce Standing Committee.                                                                  
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
              SB 52-PORTABLE ELECTRONICS INSURANCE                                                                          
                                                                                                                                
4:08:27 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD announced  that the  next order  of business                                                               
would be  the CS FOR  SENATE BILL  NO. 52(L&C) "An  Act providing                                                               
that portable  electronics insurance  is not a  service contract;                                                               
providing that a portable  electronics manufacturer's warranty or                                                               
extended  warranty is  not regulated  as  insurance; relating  to                                                               
portable  electronics  insurance;  authorizing  the  director  of                                                               
insurance  to issue  a  limited producer  license  to a  portable                                                               
electronics  vendor   for  the   sale  of   portable  electronics                                                               
insurance;  and   relating  to  authorization  and   training  of                                                               
employees and  representatives of  a vendor to  transact portable                                                               
electronics insurance; and providing for an effective date."                                                                    
                                                                                                                                
4:08:40 PM                                                                                                                    
                                                                                                                                
RYNNIEVA  MOSS,   Staff,  Senator  John  Coghill,   Alaska  State                                                               
Legislature,  informed  the   committee  that  Senator  Coghill's                                                               
staff, Kari  Nore, is a  student from Gonzaga  University serving                                                               
as an  intern through the  University of Alaska  Southeast (UAS).                                                               
Ms.  Nore drafted  and researched  the bill,  prepared documents,                                                               
and has been presenting the bill to committees.                                                                                 
                                                                                                                                
KARI   NORE,  Intern,   Senator   John   Coghill,  Alaska   State                                                               
Legislature, introduced herself.                                                                                                
                                                                                                                                
4:09:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CHENAULT  moved  to   adopt  the  proposed  House                                                               
committee  substitute  (CS)  for   SB  52,  labeled  28-LS0461\O,                                                               
Bailey, 4/5/13 as the working document.                                                                                         
                                                                                                                                
VICE CHAIR REINBOLD objected for purpose of discussion.                                                                         
                                                                                                                                
4:09:49 PM                                                                                                                    
                                                                                                                                
MS.  NORE   stated  that  this  bill   would  establish  portable                                                               
electronic insurance  under AS  21.  This  bill would  attempt to                                                               
bring structure  to the electronics insurance  market and protect                                                               
consumers by  adding portable  electronic insurance  not included                                                               
under a service  contract, but regulated through  the Division of                                                               
Insurance.     Section  2   would  add   a  new   subsection,  AS                                                               
21.03.021(g),  to clarify  that  Title  21 does  not  apply to  a                                                               
portable   electronics   manufacturer's  warranty   or   extended                                                               
warranty.    Section  3  would  add a  citation  to  reflect  the                                                               
addition of  the portable electronic  insurance that  is outlined                                                               
in Section  4.  Section  4 would add a  new paragraph (8)  [to AS                                                               
21.27.150(a)]  to   allow  the  state's  director,   Division  of                                                               
Insurance  (DOI),   to  issue  a  portable   electronics  limited                                                               
producer  license  to a  vendor  that  sells or  offers  portable                                                               
electronics insurance.   The license  would cover the  vendor and                                                               
employees for all  locations in the state where  the vendor sells                                                               
the products.   The employees do not have to  be licensed so long                                                               
as  they  are  not  solely  compensated  based  on  the  sale  of                                                               
insurance.   The vendor  would have a  training program  and will                                                               
maintain a registry, she said.                                                                                                  
                                                                                                                                
4:11:09 PM                                                                                                                    
                                                                                                                                
MS.   NORE  related   that  Section   5  would   define  portable                                                               
electronics insurance, list the  materials that must be presented                                                               
to   the  consumer   in  writing,   define   the  procedure   for                                                               
modification  of   the  terms  of   the  insurance,   define  the                                                               
procedures  to terminate  the insurance,  and list  the types  of                                                               
devices  that   will  be   covered  under   portable  electronics                                                               
insurance.  Section 6 would  provide an effective date of January                                                               
1, 2014, to allow the DOI  time to complete installation of a new                                                               
software  program for  data entry.   This  will prevent  the bill                                                               
from having a fiscal impact, she said.                                                                                          
                                                                                                                                
4:12:18 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER,  referring  to   Section  3,  asked  for                                                               
clarification  as to  whether the  employees who  are not  solely                                                               
compensated have to be licensed.                                                                                                
                                                                                                                                
MS. NORE referred to page 5, line 29, which read:                                                                               
                                                                                                                              
               (i)     the    employees     or    authorized                                                                  
     representatives are not  compensated based primarily on                                                                    
     the   number  of   customers  enrolled   for  coverage;                                                                    
     however, an  employee or authorized  representative may                                                                    
     receive compensation  for activities under  the license                                                                    
     that  is incidental  to  the  employee's or  authorized                                                                    
     representative's overall compensation;                                                                                     
                                                                                                                                
MS. NORE explained that the  employees will receive salaries, and                                                               
the vendor  can offer  a bonus if  they choose to  do so.   Thus,                                                               
this bill does not mandate it.                                                                                                
                                                                                                                                
4:13:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER  asked if  an employees  are commissioned,                                                               
the salaries  are not compensated  based primarily on  the number                                                               
of customers  enrolled for  coverage.  He  asked whether  this is                                                               
solely  for salaried  employees  or  if it  would  also apply  to                                                               
commission sales.                                                                                                               
                                                                                                                                
MS. NORE related her understanding  that this bill would apply to                                                               
salaried employees.                                                                                                             
                                                                                                                                
REPRESENTATIVE SADDLER remarked it would be easier to manage.                                                                   
                                                                                                                                
4:13:53 PM                                                                                                                    
                                                                                                                                
MS.  NORE explained  that  on page  2, line  2,  of CSSB  52(L&C)                                                               
portable electronics was included  as tangible personal property;                                                               
however,  through  discussions,  the  sponsor  decided  this  was                                                               
unnecessary  since portable  electronics were  already considered                                                               
as personal property.  Therefore,  Version O does not include the                                                               
language "including portable electronics" on  page 2, lines 2 and                                                           
8.                                                                                                                              
                                                                                                                                
4:14:57 PM                                                                                                                    
                                                                                                                                
MS. NORE  pointed out  that originally the  language on  page 10,                                                               
line 10, of  CSSB 52(L&C) read:  "a service  contract governed by                                                               
AS 21.03.021(e);"  which was  found to be  confusing.   Thus, the                                                               
language  was reworded  in Version  O to  read:   "(i) A  service                                                               
contract described in AS 21.03.021 (e);" in order to clarify it.                                                                
                                                                                                                                
VICE  CHAIR   REINBOLD  removed  her  objection.     [No  further                                                               
objection  was stated  and  the committee  treated  Version O  as                                                               
before it.]                                                                                                                     
                                                                                                                                
4:15:46 PM                                                                                                                    
                                                                                                                                
STEPHEN MCDANIEL, Asurion  Wireless Insurance Services [Asurion],                                                               
said  he  is available  to  answer  questions.   He  stated  that                                                               
Asurion is a provider of  this portable electronics insurance and                                                               
works with  wireless carriers to provide  this protection program                                                               
to customers.  He stated he is here in support of the bill.                                                                     
                                                                                                                                
4:16:34 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER  asked whether he could  describe the most                                                               
common losses.                                                                                                                  
                                                                                                                                
MR. MCDANIEL answered  he was unsure, but probably  damage to the                                                               
device from dropping  it, which is from  his personal experience.                                                               
He said the program would  cover physical damage, loss, and theft                                                               
of the devices.                                                                                                                 
                                                                                                                                
VICE CHAIR REINBOLD,  after first determining no  one else wished                                                               
to testify, closed public testimony on SB 52.                                                                                   
                                                                                                                                
4:17:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CHENAULT  moved  to  report  the  proposed  House                                                               
committee substitute (CS) for  CSSB 52(L&C), labeled 28-LS0461\O,                                                               
Bailey, 4/5/13, out of  committee with individual recommendations                                                               
and the  accompanying fiscal  notes.   There being  no objection,                                                               
HCS CSSB 52(L&C)  was reported from the House  Labor and Commerce                                                               
Standing Committee.                                                                                                             
                                                                                                                                
The committee took an at-ease from 4:18 p.m. to 4:21 p.m.                                                                       
                                                                                                                                
          HB 121-COMMERCIAL FISHING & AGRICULTURE BANK                                                                      
                                                                                                                                
4:21:03 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD announced  that the  next order  of business                                                               
would  be   HOUSE  BILL  NO.   121,  "An  Act  relating   to  the                                                               
examinations, board,  loans, records,  and lobbying  contracts of                                                               
the  Alaska   Commercial  Fishing   and  Agriculture   Bank;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
4:21:08 PM                                                                                                                    
                                                                                                                                
MICHAEL PASCHALL, Staff, Representative  Eric Feige, Alaska State                                                               
Legislature,  speaking  on  behalf  of the  sponsor  of  HB  121,                                                               
Representative  Feige,  stated  that   HB  121  pertains  to  the                                                               
Commercial  Fishing   and  Agriculture  Bank  (CFAB),   which  he                                                               
characterized as  a great  success.  The  program was  started 21                                                               
years  ago with  an initial  investment of  $32 million  from the                                                               
state, with the provision that  the state would be reimbursed for                                                               
the money put  into the bank.  The statutes  initially created by                                                               
the enabling  legislation made  the CFAB  independent of  all the                                                               
other banking rules.   Thus a specific set  of statutes regulates                                                               
one bank,  which is a  private bank, operating as  a cooperative;                                                               
however,  the CFAB  does not  fall under  existing banking  laws.                                                               
The CFAB's board  desires to change the operation  slightly so it                                                               
can better serve its members and customers, he related.                                                                         
                                                                                                                                
4:22:34 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MILLETT  said she  has a potential  conflict since                                                               
one of her family members is a fisherman.                                                                                       
                                                                                                                                
REPRESENTATIVE SADDLER objected.                                                                                                
                                                                                                                                
4:22:56 PM                                                                                                                    
                                                                                                                                
MR.  PASCHALL offered  to  provide a  sectional  analysis of  the                                                               
bill.   Section 1 would adjust  the lending power of  the bank by                                                               
eliminating the  borrowing limits on  certain types of  loans. It                                                               
also would remove the residency  requirement for certain types of                                                               
capital  loans if  the facility  is located  within the  state as                                                               
well  as  expand  the  types  of  loans  that  may  be  given  to                                                               
nonmembers.    Section 1  would  also  make loans  available  for                                                               
certain tourism  operations and for  operations dedicated  to the                                                               
development  or exploitation  of  natural resources.   Section  2                                                               
would  add  commercial  agriculture   to  the  current  provision                                                               
thereby allowing loans to nonmembers  for commercial fisheries in                                                               
certain areas.   Section 3 would change the  dollar limitation on                                                               
loans to  nonmembers from  $25,000 to $50,000.   Section  4 would                                                               
increase the debt to capital ratio  from 8 percent to 25 percent.                                                               
Section 5 is conforming language  pertaining to bank examinations                                                               
added in  Section 7,  and it also  would correct  a typographical                                                               
error  in  statue.   Section  6  would  allow  the bank  to  make                                                               
available  a list  of those  eligible to  serve on  the board  of                                                               
directors  of  the  loan  to  those  members  eligible  to  vote.                                                               
Section  7  would  provide  that   the  Department  of  Commerce,                                                               
Community, and Economic Development  (DCCED) shall audit the bank                                                               
at least  once every 36 months,  which is a standard  practice in                                                               
the  industry.   Section 8  would repeal  AS 44.81.020(f),  which                                                               
sets  director   compensation,  and  AS   44.99.030(a)(2),  which                                                               
prohibits lobbying by the bank.   Section 9 would delay the audit                                                               
established  in Section  7  until one  year  after the  effective                                                               
date.     Finally,  Section  10  would   establish  an  immediate                                                               
effective date.                                                                                                                 
                                                                                                                                
4:25:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON,  referring to pages  3 and 4,  he asked                                                               
whether the CFAB has $35 million in assets.                                                                                     
                                                                                                                                
MR. PASCHALL deferred  to the bank to answer.   He said there was                                                               
an initial  investment by  the state, which  was $32  million and                                                               
was repaid to the state by  the bank through its earnings through                                                               
the repurchase of stock in the bank.                                                                                            
                                                                                                                                
4:26:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON asked  how  stiff  the competition  for                                                               
available funds is today, without HB 121.                                                                                       
                                                                                                                                
LELA  KLINGERT,  President/CEO,  Alaska  Commercial  Fishing  and                                                               
Agriculture Bank (CFAB), answered that  she was unsure whether he                                                               
was referring to competition in the industry for loans.                                                                         
                                                                                                                                
REPRESENTATIVE JOSEPHSON  asked whether the CFAB  issues a finite                                                               
amount of loans.                                                                                                                
                                                                                                                                
MS. KLINGERT  related that the  $35 million  previously mentioned                                                               
equals the  total loan  volume or  the amount  of loans  that are                                                               
outstanding.  She explained that  CFAB borrows from CoBank, which                                                               
is  a national  cooperative bank  headquartered in  Denver.   For                                                               
every loan CFAB  makes, CoBank will advance funds.   For example,                                                               
for every  $100 in loans  that CFAB issues, CoBank  would advance                                                               
$80, and the remainder would come from CFAB's capital.                                                                          
                                                                                                                                
4:28:03 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON asked how much  capital CFAB has that is                                                               
not outstanding.                                                                                                                
                                                                                                                                
MS. KLINGERT answered approximately $20 million.                                                                                
                                                                                                                                
4:28:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  asked how  much competition  exists for                                                               
the $20 million  in CFAB loans and  whether sufficient applicants                                                               
for the loans are simply not available.                                                                                         
                                                                                                                                
MS. KLINGERT answered  that the entire amount of  the $35 million                                                               
has been lent,  which represents CFAB's $20 million  plus the $15                                                               
million from  CoBank.  She  explained that through  that process,                                                               
CFAB  could lend  another  $70 million  using  CFAB's capital  as                                                               
leverage.    She  was  unsure  of  the  specific  competition  in                                                               
question and whether  he was referring to  competition with other                                                               
banks.                                                                                                                          
                                                                                                                                
REPRESENTATIVE  JOSEPHSON offered  that  he is  curious why  CFAB                                                               
would extend  loans to corporations  and individuals who  are not                                                               
Alaskans.   If there  is not  much interest  in loans  in Alaska,                                                               
that would answer his question, he said.                                                                                        
                                                                                                                                
MS. KLINGERT  replied that the  demand is not in  extending loans                                                               
to nonresidents.   First, that portion of CFAB  loans is limited.                                                               
In fact,  loans would not be  opened to all nonresidents  for any                                                               
reason  since  loans  would  be  limited only  to  those  with  a                                                               
facility  located in  Alaska, such  as a  fishing lodge  or if  a                                                               
party wanted to acquire the  lodge structure.  She explained that                                                               
CFAB's  typical borrower  may be  one that  is not  attractive to                                                               
commercial  banks,   and  thus  CFAB  would   create  alternative                                                               
financing.                                                                                                                      
                                                                                                                                
4:30:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT  answered that CFAB  loans may not  be as                                                               
attractive as  ones from  regular commercial  lenders.   He asked                                                               
whether CFAB  lends at a higher  rate than a normal  lender or if                                                               
CFAB has options on setting interest rates on loans.                                                                            
                                                                                                                                
MS. KLINGERT answered that the  interest rates other banks charge                                                               
varies.    She  offered  her   belief  that  from  a  competitive                                                               
standpoint, if  CFAB contemplated a  loan that a  commercial bank                                                               
wanted to make,  the commercial bank would likely be  in a better                                                               
position to offer a lower rate than CFAB.                                                                                       
                                                                                                                                
REPRESENTATIVE CHENAULT  surmised that  is CFAB's  opportunity to                                                               
take  into consideration  the applicant's  credit worthiness  and                                                               
ability to repay the loan.                                                                                                      
                                                                                                                                
MS. KLINGERT stated her agreement.                                                                                              
                                                                                                                                
4:31:49 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON asked  whether CFAB  has made  loans to                                                               
smaller   businesses,  fishing   enterprises   such  as   Trident                                                               
Seafoods, large mining companies, or larger corporations.                                                                       
                                                                                                                                
MS. KLINGERT answered  that CFAB is typically not a  place that a                                                               
large operation  such as Trident  Seafoods or a large  mine would                                                               
seek  financing, but  in theory  CFAB  could issue  that type  of                                                               
loan.   However,  CFAB's  size limits  its  dealings with  larger                                                               
companies, which would  tend to concentrate the risk  in one type                                                               
of loan and not be wise.                                                                                                        
                                                                                                                                
VICE CHAIR REINBOLD,  after first determining no  one else wished                                                               
to testify, closed public testimony on HB 121.                                                                                  
                                                                                                                                
4:33:16 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT moved  to report HB 121  out of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
note.   There being no  objection, HB  121 was reported  from the                                                               
House Labor and Commerce Standing Committee.                                                                                    
                                                                                                                                
The committee took an at-ease from 4:33 p.m. to 4:36 p.m.                                                                       
                                                                                                                                
                 HB 152-PERS TERMINATION COSTS                                                                              
                                                                                                                                
4:36:18 PM                                                                                                                    
                                                                                                                                
VICE CHAIR  REINBOLD announced that  the final order  of business                                                               
would be HOUSE BILL NO.  152, "An Act requiring certain employers                                                               
who  terminate participation  in the  defined benefit  retirement                                                               
plan or  the defined contribution  retirement plan of  the Public                                                               
Employees'  Retirement System  to make  contributions related  to                                                               
past  service liability  and pay  termination costs;  repealing a                                                               
requirement  that employers  who terminate  participation in  the                                                               
defined  contribution  retirement  plan or  the  defined  benefit                                                               
retirement plan  of the Public  Employees' Retirement  System pay                                                               
for  a termination  cost study;  and providing  for an  effective                                                               
date."                                                                                                                          
                                                                                                                                
4:36:33 PM                                                                                                                    
                                                                                                                                
JANE PIERSON, Staff, Representative  Steve Thompson, Alaska State                                                               
Legislature,  speaking  on  behalf  of the  sponsor  of  HB  152,                                                               
Representative  Thompson, said  the state's  termination studies,                                                               
laws, and  regulations make it  difficult and more  expensive for                                                               
municipal  employers to  deliver their  programs and  services by                                                               
requiring  an   employer  that  terminates  participation   of  a                                                               
department group  or other  classification of  employee to  pay a                                                               
series of  actuarially-determined costs.  The  municipalities are                                                               
working toward modernizing  and standardizing job classifications                                                               
and although  that may  result in  fewer job  classifications, it                                                               
may  not necessarily  result  in fewer  employees.   Current  law                                                               
unnecessarily  requires termination  studies and  costs for  such                                                               
actions.     The  municipalities  really  need   the  operational                                                               
flexibility  to  effectively  manage  and  deliver  programs  and                                                               
services while  continuing to contribute toward  paying off their                                                               
debts  associated with  the Public  Employees' Retirement  System                                                               
(PERS).   Paying off  the unfunded  PERS liability  is predicated                                                               
upon  a stable  and reasonably  growing system-wide  salary base.                                                               
System-wide  salaries  for   defined  contributions  and  defined                                                               
benefits have increased by $325  million or 18.6 percent over the                                                               
base salary floor,  which was established in 2008  by Senate Bill                                                               
125 in the 25th legislature.   As a result, contributions for the                                                               
unfunded  liability have  increased at  a rate  greater than  the                                                               
actuarially assumed annual  growth rate of 4 percent.   This bill                                                               
would maintain  the PERS contribution floor  while employers must                                                               
pay whichever  is greater, 22  percent of their  current combined                                                               
defined  benefit  and  defined  contribution salary  base  or  an                                                               
amount based  on their total  payroll for the period  ending June                                                               
30, 2008.                                                                                                                       
                                                                                                                                
4:39:28 PM                                                                                                                    
                                                                                                                                
MS.  PIERSON  said  HB  152 would  replace  the  requirement  for                                                               
termination  studies  with  formula  driven  partial  termination                                                               
cost, as  follows:   20 percent  flexibility for  employers whose                                                               
total payroll is greater than  $5,000,000, which is 93 percent of                                                               
employers in  FY 12; 50  percent flexibility for  employers whose                                                               
total payroll  is between $1-$5  million, which was 6  percent of                                                               
employers in  FY 12; and  the study  would not be  applicable for                                                               
employers whose total payroll is  less than $1,000,000, which was                                                               
1 percent of employers in FY 12.   Using the data that is readily                                                               
available, the amount by which  an employer's terminated salaries                                                               
are  calculated to  exceed the  20-50 percent  threshold would be                                                               
applied to the  current past service contribution  rate, which is                                                               
currently 24.19  percent, and would  then be paid  annually until                                                               
the unfunded PERS liability is paid off.                                                                                        
                                                                                                                                
4:40:24 PM                                                                                                                    
                                                                                                                                
MS.  PIERSON provided  a brief  sectional analysis  of the  bill.                                                               
Section 1 would  retain the minimum requirement  for employers to                                                               
make contributions  based on 22  percent of the greater  of their                                                               
current  salary  base   or  the  salary  base   as  of  6/30/2008                                                               
regardless of termination participation  from the defined benefit                                                               
plan.   Section  2 would  place the  requirement for  termination                                                               
costs  studies performed  by the  actuary with  termination costs                                                               
determined  via   formula  as   follows:     partial  termination                                                               
thresholds,  based  on  20  percent  for  employers  whose  total                                                               
payroll is greater  than $5,000,000 and 50  percent for employers                                                               
whose total  payroll is greater  than $1-5  million; [termination                                                               
costs] are  not applicable for  employers whose total  payroll is                                                               
under  $1 million.    Section 2  would  establish a  rolling-tier                                                               
period  for  which  costs  from  partial  terminations  would  be                                                               
determined, it  use readily available  data, and  establishes the                                                               
formula for  determining termination costs.   Thus any terminated                                                               
salary beyond the threshold of  20-50 percent would be applied to                                                               
the current past  service contribution rate and  be paid annually                                                               
until the  past service liability is  paid in full.   The formula                                                               
is  simple  and  does  not  require  any  consultant  fee.    She                                                               
explained it  would be  an amount by  which an  employer's salary                                                               
base  exceeds its  salary  base  from two  years  prior by  20-50                                                               
percent, depending  on the current  salary base  level multiplied                                                               
by the  past service  contribution rate  multiplied by  the total                                                               
years to  pay down  the total unfunded  liability.   For example,                                                               
$100,000   multiplied  by   24  would   equal  $24,000   annually                                                               
multiplied by 30 years would equal $720,000, she said.                                                                          
                                                                                                                                
4:42:18 PM                                                                                                                    
                                                                                                                                
MS.  PIERSON related  that  Sections  3, 4,  and  5 correlate  to                                                               
Section  2,  but  pertain  to   the  defined  contribution  plan.                                                               
Section  6 would  repeal language  requiring a  termination study                                                               
for  an   employer  that  requests  termination   from  the  plan                                                               
altogether, but  such an employer  would still be subject  to the                                                               
base floor.   This  would also annul  the regulation  that covers                                                               
the calculation  of termination cost  studies.  Sections 8  and 9                                                               
would  add  applicability  retroactively to  allow  employers  to                                                               
discontinue any payments  after the effective date of  the act in                                                               
which an  employer would  not have  had to pay  if a  new formula                                                               
were in  place after June  30, 2008.   The last  section, Section                                                               
10, would add the effective date.                                                                                               
                                                                                                                                
4:43:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  asked for  clarification on  the amount                                                               
of the fiscal note.                                                                                                             
                                                                                                                                
MS. PIERSON answered that the  fiscal impact is $6,772,000 for FY                                                               
14  and continues  to FY  19 in  the amount  of $7,462,000.   She                                                               
acknowledged this bill has quite a hefty fiscal note.                                                                           
                                                                                                                                
4:44:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  asked  whether   the  fiscal  note  is                                                               
indefinite until the terminated employees are deceased.                                                                         
                                                                                                                                
MS. PIERSON answered  that it would be indefinite  until PERS and                                                               
the Teachers Retirement  System (TRS) of $11  billion in unfunded                                                               
liability is paid off.                                                                                                          
                                                                                                                                
4:44:53 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON asked whether this  would add to the $11                                                               
billion.                                                                                                                        
                                                                                                                                
MS. PIERSON  clarified that it would  not add to the  $11 billion                                                               
but  rather would  be a  shift  away from  municipalities to  the                                                               
state.                                                                                                                          
                                                                                                                                
REPRESENTATIVE JOSEPHSON  asked whether some  municipalities have                                                               
instituted  plans  to stay  on  top  of these  obligations  while                                                               
others have not.                                                                                                                
                                                                                                                                
MS. PIERSON related her understanding  that every municipality is                                                               
now required to adhere to same  standards, but some have not been                                                               
able to pay their portion of the unfunded liability.                                                                            
                                                                                                                                
4:45:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  noted that he  filed a bill  that would                                                               
increase   revenue  sharing   to   municipalities;  however,   he                                                               
expressed  concern.    He  recalled  that in  2008  or  2010  the                                                               
legislature  devised a  plan that  was curative  and supposed  to                                                               
solve this problem.                                                                                                             
                                                                                                                                
MS.  PIERSON  replied that  in  2008,  the state  discovered  the                                                               
actuarial figures  were not accurate.   At  the time a  base rate                                                               
was  put  on  all  municipalities and  termination  studies  were                                                               
required when an  employee is terminated.   However, she recalled                                                               
a  scenario   in  which  the  Municipality   of  Anchorage  (MOA)                                                               
transferred its weatherization  department to another [municipal]                                                               
agency and  although no employees  were actually  terminated, the                                                               
MOA still had to pay termination costs and studies.                                                                             
                                                                                                                                
4:47:15 PM                                                                                                                    
                                                                                                                                
LUCINDA  MAHONEY, Chief  Fiscal  Officer  (CFO), Municipality  of                                                               
Anchorage  (MOA), stated  at the  time  termination studies  were                                                               
implemented in  2008, there  was a  concern that  employers might                                                               
contract out  municipal positions  to avoid  the 22  percent PERS                                                               
cost,  thus  shrinking  the  PERS  base needed  to  pay  off  the                                                               
unfunded  liability.   As  Ms.  Pierson  indicated this  has  not                                                               
happened,  she said.    In  fact, since  2008,  on a  system-wide                                                               
basis, the salaries  have increased by $325 million,  which is at                                                               
a rate which is higher than  what the actuary uses in determining                                                               
and calculating  the unfunded  liability.   In essence,  the fear                                                               
that  initiated   the  change   in  statute   in  2008   has  not                                                               
materialized.   As the CFO of  the largest city in  Alaska, it is                                                               
important the MOA  has flexibility to manage its  workforce.  For                                                               
example, the  MOA may not receive  a state or federal  grant, and                                                               
if so,  may need to lay  off employees when the  federal grant is                                                               
not  received.   Additionally,  the  MOA  may transfer  employees                                                               
within  job  classifications  and  a job  classification  may  no                                                               
longer be  used, which  would also  trigger a  termination study;                                                               
however,  the  MOA  has  been   standardizing  many  of  its  job                                                               
classifications,  which may  not result  in fewer  employees, but                                                               
may   result   in   fewer  classifications.      Therefore,   the                                                               
aforementioned could  trigger a  termination study and  cause the                                                               
MOA to unnecessarily pay into the  program.  She asked members to                                                               
consider  this bill  since municipalities,  such as  the MOA  and                                                               
very small  cities, are being punished  for creating efficiencies                                                               
to modernize the workforce.                                                                                                     
                                                                                                                                
4:51:12 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  questioned  whether  this  legislation                                                               
would  be necessary,  if the  administration  had not  introduced                                                               
Administrative Order (AO) 37 in early February.                                                                                 
                                                                                                                                
MS. MAHONEY answered that the bill has no effect on AO 37.                                                                      
                                                                                                                                
REPRESENTATIVE JOSEPHSON  questioned whether the MOA  would still                                                               
need  to  cover  some of  the  prior  PERS  if  some of  the  MOA                                                               
municipal workforce  is privatized as  the MOA will not  have the                                                               
salary base.                                                                                                                    
                                                                                                                                
MS.  MAHONEY answered  that  if  the MOA  were  to privatize  any                                                               
portion of  workforce, the bill  would look to the  sliding scale                                                               
proposed.   For example, the  MOA would consider the  average two                                                               
years' worth  of salaries and  if the  change is greater  than 20                                                               
percent,  the  MOA would  pay  for  that  component of  the  PERS                                                               
termination study  and would  pay the liability  until 2030.   In                                                               
brief,  this  bill  recognizes  the  goal  of  municipalities  to                                                               
continue  to   contribute  to  help   bring  down   the  unfunded                                                               
liability.  However, the MOA has  suggested a sharing of the cost                                                               
depending on triggers and the size of the community.                                                                            
                                                                                                                                
4:53:20 PM                                                                                                                    
                                                                                                                                
LUKE  HOPKINS,  Mayor,  Fairbanks   North  Star  Borough  (FNSB),                                                               
offered the FNSB's support for HB  152.  He acknowledged that the                                                               
unfunded  liability needs  to be  paid off  and agrees  to fairly                                                               
sharing  these obligations.   However,  in  considering the  PERS                                                               
termination aspect based  on the number of  employees, the salary                                                               
floor  is  important.    He  pointed  out  that  the  salary  has                                                               
increased about  19 percent and  the termination study,  law, and                                                               
regulations   have   created   unintended   consequences,   which                                                               
adversely  impact municipalities  with regard  to managing  their                                                               
workforce.   He  offered  his  belief that  this  bill, with  its                                                               
sliding scale, would  be a fair and equitable  method to continue                                                               
to pay the FNSB's  portion of the debt as it  has done each year.                                                               
He reiterated support for HB 152.                                                                                               
                                                                                                                                
4:54:57 PM                                                                                                                    
                                                                                                                                
SALLIE STUVEK,  Director, Human  Resources, Fairbanks  North Star                                                               
Borough  (FNSB), stated  that  HB  152 is  a  positive bill  that                                                               
addresses serious  concerns with  the existing  statutes relating                                                               
to  the  triggering  of  termination   studies.    Management  of                                                               
municipal employees  is dynamic  and fluctuates based  on service                                                               
needs.    She  said  that  flexibility  is  necessary,  based  on                                                               
programs and  services that are  offered.  For example,  the FNSB                                                               
might need to hire additional  librarians based on public demand,                                                               
but  may  need  fewer  lifeguards   this  year.    This  type  of                                                               
flexibility is critical for efficient  delivery of services.  She                                                               
offered her  belief that tying  the need for a  termination study                                                               
to  the  base salary  makes  more  sense  than  tying it  to  the                                                               
classification,  department,   or  division.    As   Ms.  Mahoney                                                               
testified  earlier, the  FNSB shares  concern about  the lack  of                                                               
flexibility.  She thanked members for consideration of HB 152.                                                                  
                                                                                                                                
4:56:14 PM                                                                                                                    
                                                                                                                                
KATHIE  WASSERMAN, Executive  Director,  Alaska Municipal  League                                                               
(AML), stated  the AML is in  support of HB 152.   She emphasized                                                               
the main thing is  to get this topic on the  table.  She reminded                                                               
the committee that  the AML represents all  162 municipalities in                                                               
the  state  who  feel  the   repercussions  from  this  statutory                                                               
structure.   Accordingly, the  biggest outcome  is municipalities                                                               
cannot manage their personnel.   For example, [termination costs]                                                               
affect  small municipalities,  such  that if  a municipality  has                                                               
four  employees  and the  population  decreases  or finances  are                                                               
reduced  and one  person  is  placed in  layoff  status, it  will                                                               
trigger  a termination  study.   Under AS  39.35, this  means the                                                               
municipality must pay termination costs  over the long term until                                                               
the liability is  paid off.  This  could take up to  25 years and                                                               
represents  a huge  expense  for  a small  community.   For  this                                                               
reason,  the state  needs to  find a  solution to  work with  the                                                               
municipalities to resolve this issue.   She acknowledged this may                                                               
not  be easy,  since  the unfunded  liability  represents an  $11                                                               
billion  shortfall;  however,  the  termination  study  provision                                                               
adversely  impacts   all  communities  and  prevents   them  from                                                               
managing  their personnel.   In  fact,  some municipalities  have                                                               
decided  not to  lay off  employees since  they can't  afford the                                                               
outcome, which seems  backwards.  She remarked that  it has taken                                                               
her many  years to get to  the point of fully  understanding this                                                               
issue since it is complicated.                                                                                                  
                                                                                                                                
4:58:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON understood this  bill raises two issues.                                                               
First, it  raises the  issue of the  cost of  termination studies                                                               
and  second, it  raises the  issue of  the even  greater cost  of                                                               
funding vested liability for those employees not on payroll.                                                                    
                                                                                                                                
MS. WASSERMAN  answered yes.   In further response, she  said the                                                               
obligation is  not based on  the individual, but on  the position                                                               
that  no longer  exists.   For example,  this first  came to  the                                                               
AML's attention when a municipal  fire chief position was changed                                                               
to an  emergency medical  services director,  but the  person was                                                               
retained  by  the  municipality,   yet  the  change  triggered  a                                                               
termination study since the position was dissolved.                                                                             
                                                                                                                                
[HB 152 was held over.]                                                                                                         
                                                                                                                                
5:00:21 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no further business before the committee, the House                                                                 
Labor and Commerce Standing Committee meeting was adjourned at                                                                  
5:00 p.m.                                                                                                                       

Document Name Date/Time Subjects
HB121 ver A.pdf HL&C 4/5/2013 3:15:00 PM
HB 121
HB121 Sponsor Statement.pdf HL&C 4/5/2013 3:15:00 PM
HB 121
HB121 Sectional Analysis.pdf HL&C 4/5/2013 3:15:00 PM
HB 121
HB121 Fiscal Note-DCCED-DBS-03-29-13.pdf HL&C 4/5/2013 3:15:00 PM
HB 121
HB121 Supporting Documents-Statutes CFAB AS 44.pdf HL&C 4/5/2013 3:15:00 PM
HB 121
SB52 ver C.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Sponsor Statement.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Sectional Analysis.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Fiscal Note-DCCED-DOI 03-19-13.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Draft Proposed CS ver O(L&C) .PDF HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Supporting Documents Article Colorado Springs Gazette 4-6-2012.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Supporting Documents Article Ezine Articles.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Supporting Documents Article The Street Personal Finance 2-13-2013.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Supporting Documents Legislation Summary.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Supporting Documents Letter ATT 2-22-2013.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
SB52 Supporting Documents States_with_Similar_Legislation.pdf HL&C 4/5/2013 3:15:00 PM
SB 52
HB150 ver U.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Sponsor Statement.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Fiscal Note-DOLWD-CO-3-29-13.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Fiscal Note-EED-TLS-4-2-13.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Fiscal Note-UA-SYSBRA-4-02-13.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Draft Proposed CS ver N.PDF HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-Alaska Training Program Performance 2012.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-Assorted Letters.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-Distribution History.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-Distribution History-CORRECTED 4-3-13.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-DOLWD TVEP Helped Fund.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-Fund Source Report.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB150 Supporting Documents-Unemployment Rates.pdf HL&C 4/5/2013 3:15:00 PM
HB 150
HB152 Fiscal Note-DOA-DRB-4-03-13.pdf HL&C 4/5/2013 3:15:00 PM
HL&C 3/10/2014 3:15:00 PM
HB 152
HB152 Ver C.pdf HL&C 4/5/2013 3:15:00 PM
HL&C 3/10/2014 3:15:00 PM
HB 152
HB152 Sponsor Statement ver. C.pdf HL&C 4/5/2013 3:15:00 PM
HL&C 3/10/2014 3:15:00 PM
HB 152
HB152 Sectional Analysis.pdf HL&C 4/5/2013 3:15:00 PM
HL&C 3/10/2014 3:15:00 PM
HB 152
HB152 Supporting Documents-PERS Employer Salaries FY08 vs. FY12.pdf HL&C 4/5/2013 3:15:00 PM
HL&C 3/10/2014 3:15:00 PM
HB 152