Legislature(2011 - 2012)SENATE FINANCE 532

01/18/2012 09:00 AM FINANCE

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SENATE BILL NO. 86                                                                                                            
     "An Act  relating to the  protection of property  of persons                                                               
     under  disability  and  minors;  relating to  the  crime  of                                                               
     violating a  protective order concerning  certain vulnerable                                                               
     persons; relating  to aggravating factors at  sentencing for                                                               
     offenses concerning a victim 65  years or older; relating to                                                               
     the protection  of vulnerable  adults; amending  Rule 12(h),                                                               
     Alaska  Rules of  Criminal Procedure;  amending Rule  45(a),                                                               
     Alaska  Rules  of  Criminal  Procedure;  amending  Rule  65,                                                               
     Alaska Rules  of Civil Procedure;  amending Rule  17, Alaska                                                               
     Rules of  Probate Procedure; amending  Rule 9,  Alaska Rules                                                               
    of Administration; and providing for an effective date."                                                                    
9:54:35 AM                                                                                                                    
KIMBERLI   POPPE-SMART,   DEPUTY   COMMISSIONER,   MEDICAID   AND                                                               
HEALTHCARE  POLICY, DEPARTMENT  OF  HEALTH  AND SOCIAL  SERVICES,                                                               
testified in support and introduced  the bill and stated that the                                                               
legislation was a collaborative, cross-agency effort.                                                                           
9:57:38 AM                                                                                                                    
JOANNE  GIBBENS,  DEPUTY  DIRECTOR, SENIOR  DISABILITY  SERVICES,                                                               
DEPARTMENT OF  HEALTH AND SOCIAL  SERVICES, testified  in support                                                               
of SB 86  and highlighted important elements  of the legislation,                                                               
which  covered   existing  gaps  in  the   services  provided  to                                                               
vulnerable adults. She stated that  the most important element of                                                               
the   bill  created   a  process   for  appointing   a  temporary                                                               
conservator  to  someone  at  risk   of  eminent  harm  to  their                                                               
financial status  or healthcare decision making.  The legislation                                                               
allowed  the court  to  impose  emergency conservatorships  which                                                               
could be  removed or  renewed as needed.  She furthered  that the                                                               
bill assisted in protecting  financial assets, managing financial                                                               
affairs, and  preventing eminent waste or  fraudulent dissipation                                                               
of assets.  She declared that  the second most  important element                                                               
of the  bill created  a process for  the imposition  of financial                                                               
protective orders. The legislation  imparted the ability to apply                                                               
for  a 20-day  ex parte  protective  order that  gave courts  the                                                               
tools to stop  or prevent financial exploitation.  She noted that                                                               
these  tools were  not currently  available  to Adult  Protective                                                               
Services or others  who assist with vulnerable  adults. She added                                                               
that  another notable  element  of the  legislation  was that  it                                                               
mandated  that  anyone working  at  a  healthcare or  educational                                                               
facility must  report suspected abuse  of vulnerable  adults. She                                                               
expounded  that  currently,  only  administrators  were  mandated                                                               
reporters. Under  SB 86, the  mandate would be expanded  to apply                                                               
to educational  facilities. The  legislation also  defined "undue                                                               
influence" as  a reportable  harm. Undue  influence meant  that a                                                               
person of trust was abusing  or misusing their power and applying                                                               
undue influence  to a vulnerable  adult in order to  gain control                                                               
over their  healthcare decision making, assets,  or finances. She                                                               
felt that the addition of  undue influence and mandated reporters                                                               
would  give  the state  earlier  detection  and intervention  for                                                               
individuals  who were  vulnerable to  loss of  their property  or                                                               
decision  making. The  bill  enabled  earlier protective  orders,                                                               
facilitated   more   thorough  and   successful   investigations,                                                               
provided  protection  of  assets  during  an  investigation,  and                                                               
enhanced  criminal penalties  when  the victim  was elderly.  She                                                               
concluded that  in broad summary,  the bill would  provide Alaska                                                               
the additional tools  necessary to combat the  growing problem of                                                               
financial abuse among elderly and disabled populations.                                                                         
10:01:16 AM                                                                                                                   
Ms.  Gibbens explained  the financial  exploitation issues  among                                                               
vulnerable adults.  She indicated that Adult  Protective Services                                                               
had experienced a slow increase  in the number of calls regarding                                                               
the financial exploitation of vulnerable  adults. She stated that                                                               
the majority  of the calls  were regarding adults  over 60-years-                                                               
old, but  some calls were concerning  developmentally disabled or                                                               
traumatic  brain  injury victims.  She  remarked  that in  FY  10                                                               
Senior  & Disability  Services (SDS)  substantiated 100  cases of                                                               
financial  exploitation; that  number rose  to 125  in FY  11 and                                                               
during the current fiscal year,  SDS had already substantiated 85                                                               
cases. She indicated  there was a trend developing  in the rising                                                               
number  of   cases  of  financial  exploitation   and  that  most                                                               
instances   of  exploitation   involved  family   members  taking                                                               
advantage  of other  family  members. In  many  abuse cases,  the                                                               
offender  had  Power  of  Attorney (POA)  over  the  victim.  She                                                               
discussed  the ways  inner-family  financial abuse  occurs.   She                                                               
continued  that under  SB 86,  the undue  influence statute,  the                                                               
ability to  impose financial protective  orders, and  the ability                                                               
appoint  temporary  conservators  enabled the  state  to  respond                                                               
faster and  more effectively  to abuse.  She related  the reasons                                                               
that  caused  people to  give  up  their  POA and  explained  the                                                               
dynamics between the offender and the victim.                                                                                   
10:06:57 AM                                                                                                                   
Co-Chair Hoffman wondered if any of  the 210 cases the prior year                                                               
and a half had involved  the identity theft of vulnerable adults.                                                               
Ms. Barrans  indicated that  she did not  have the  exact numbers                                                               
with her, but confirmed that  there were cases involving identity                                                               
theft. She agreed to provide the exact numbers at a later date.                                                                 
Co-Chair Hoffman inquired how  the legislation addressed identify                                                               
theft.  Ms.  Barrans   deferred  the  question  to   one  of  the                                                               
attorneys,  but  added  that  she  did not  believe  that  SB  86                                                               
mentioned identity theft specifically.                                                                                          
Senator Egan  observed that  when vulnerable  adults relinquished                                                               
their  POA,  they  may  not   have  had  the  reasoning  capacity                                                               
necessary  to  recognize that  someone  was  taking advantage  of                                                               
them.  He wondered  how cases  where  the victim  was unaware  of                                                               
being taken advantage  of were dealt with.  Ms. Gibbens explained                                                               
that there was a process through  which an evaluation was done to                                                               
determine the victim's cognitive ability  and added that when the                                                               
victim was unaware  of being abused, a phone call  was needed for                                                               
SDS to act                                                                                                                      
Senator Egan  asked if  SB 86 required  employees of  an assisted                                                               
living  facility to  report  the abuse  of  seniors. Ms.  Gibbens                                                               
responded that  under the bill,  employees of an  assisted living                                                               
facility were mandated to report any possible abuse.                                                                            
10:09:58 AM                                                                                                                   
Senator Thomas  noted that SB 86  required temporary conservators                                                               
to  fill out  an annual  reporting form  that detailed  how funds                                                               
were  spent. He  furthered  that the  annual reporting  increased                                                               
accountability  and  he  thought   it  made  fraud  unlikely.  He                                                               
wondered  what documents  a  conservator  signed regarding  their                                                               
responsibilities and  if abuse was substantiated,  what penalties                                                               
were  enforced. Ms.  Gibbens replied  that she  was not  familiar                                                               
with  the  conservatorship  process,  but  indicated  that  Kelly                                                               
Henriksen was present to discuss the specifics of the bill.                                                                     
10:11:24 AM                                                                                                                   
Co-Chair Stedman  addressed the updated fiscal  notes attached to                                                               
SB 86.  He introduced a zero  fiscal note from the  Department of                                                               
Health  and  Social  Services  (DHSS), a  zero  fiscal  note  the                                                               
Department of Administration  (DOA), a zero fiscal  note from the                                                               
Department of Law  (DOL), a zero fiscal note  from the Department                                                               
of Public Safety (DPS), Alaska  State Troopers Detachment, a zero                                                               
fiscal note from the Department  of Corrections (DOC), and a zero                                                               
fiscal note from the Alaska  Court System (COURT). He discussed a                                                               
fiscal impact note from DPS,  Statewide Support, in the amount of                                                               
$48,000  in General  Funds  for the  purposes  of developing  new                                                               
protective  order  forms,  updating   the  Alaska  Public  Safety                                                               
Information Network (APSIN), and training.                                                                                      
10:13:37 AM                                                                                                                   
AT EASE                                                                                                                         
10:16:23 AM                                                                                                                   
10:19:20 AM                                                                                                                   
Co-Chair Hoffman  noted that  there were no  provisions in  SB 86                                                               
that  dealt with  how  the state  interfaced  with tribal  courts                                                               
regarding the  protection of vulnerable  adults. He  wondered how                                                               
Ms.  Russo  saw  the  relationship between  the  two  courts  and                                                               
queried  if  she believed,  as  he  did,  that  it needed  to  be                                                               
specifically addressed  in the  legislation. Ms.  Russo responded                                                               
that it  was her experience  that tribal courts had  not actively                                                               
taken a  role in conservatorship proceedings.  She furthered that                                                               
the  reason it  was  not included  in the  bill  was because  the                                                               
tribal courts had not participated  in the past. Co-Chair Hoffman                                                               
stressed that  the relationship between Alaska  and tribal courts                                                               
should be spelled out before it became a problem.                                                                               
Senator  Thomas  reiterated  his  prior  question  regarding  the                                                               
accountability  of  conservators  and expanded  it  to  encompass                                                               
children in the foster care system.  Ms. Russo replied that SB 86                                                               
did not specifically address the  issue of children in the foster                                                               
care system. She  related that not all  fiduciaries were required                                                               
to  report  finances,  but  that  only  appointed  guardians  and                                                               
conservators  were  subject  to reporting  responsibilities.  She                                                               
indicated that  the gap  in accountability was  the reason  SB 86                                                               
had   addressed   the   POA  issue.   Appointed   guardians   and                                                               
conservators  were  required  to  undergo training,  an  hour  of                                                               
education, and  to sign a  letter of acceptance that  stated they                                                               
understood    the   reporting    requirements.   Guardians    and                                                               
conservators could be held liable  if it had been determined that                                                               
they had acted outside  their fiduciary responsibilities. Senator                                                               
Thomas asked  if there was  a statute that gave  consideration to                                                               
other  persons that  might have  fiduciary responsibilities  over                                                               
vulnerable  individuals, particularly  regarding the  foster care                                                               
system.  Ms. Russo  deferred to  Mr. Sterling  and noted  that he                                                               
would be better  able to answer the question.  She concluded that                                                               
SB 86  focused on vulnerable  adults and  not on the  foster care                                                               
10:25:02 AM                                                                                                                   
SCOTT STERLING,  SUPERVISING ATTORNEY, OFFICE OF  ELDER FRAUD AND                                                               
ASSISTANCE,   OFFICE   OF    PUBLIC   ADVOCACY,   DEPARTMENT   OF                                                               
ADMINISTRATION (via  teleconference), began a  sectional analysis                                                               
of SB 86(copy on file). He reviewed the following sections:                                                                     
   • Section 3 makes the knowing violation or attempted                                                                         
     violation  of a  financial protective  order (introduced  in                                                               
     section 10 of this  legislation to protect vulnerable adults                                                               
     and elders) a crime.                                                                                                       
   • Section 4 amends AS 11.56.740(c), which defines "protective                                                                
     orders,"  by including  financial  protective orders  issued                                                               
     under AS  13 .26.207  -13 .26.209  to that  definition. This                                                               
     change brings  financial protective orders within  the class                                                               
     of protective orders subject to  sanction under the criminal                                                               
   • Section 5 amends AS 12.55.155(c) by adding a new paragraph                                                                 
     (35)  which  makes  the  fact  that  a  defendant  knowingly                                                               
     directed criminal  conduct at  a person 65  years of  age or                                                               
     older an aggravating factor at sentencing.                                                                                 
   • Section 6 amends AS 13.26.165(1) by substantively adding                                                                   
     several  new   paragraphs  and   changes  or   additions  in                                                               
     definitions to  enhance protection of vulnerable  persons in                                                               
     conservatorship proceedings as follows:                                                                                    
     •  amends AS 13.26.165 by deleting the  words "make another"                                                               
        and inserting the words "issue another" regarding the                                                                   
        authority of the court to issue a protection order for a                                                                
        protected person in conservatorship proceedings;                                                                        
     •  creates new paragraph (A) to authorize the court to issue                                                               
        orders protecting  a minor  with money  or property  that                                                               
        needs protection  or who  otherwise needs  protection and                                                               
        substitutes the word "that"  for the word "which"  in the                                                               
        authorizing language;                                                                                                   
     •  creates a new paragraph (B) specifying that the authority                                                               
        of the court to issue protective orders extends to minors                                                               
        with  business  affairs  that  may  be  in  jeopardy  and                                                               
        substitutes the word "that"  for the word "which"  in the                                                               
        authorizing language;                                                                                                   
     •  creates a  new  paragraph  (C) ensuring  that  protection                                                               
        extends to any need to protect a minor's funds or obtain                                                                
        funds for a minor and deletes the unnecessary use of the                                                                
        word "that" twice in the authorizing language;                                                                          
   • Section 7 amends AS 13.16.lS0(a) by adding "a person's                                                                     
     attorney  or other  legal representative."  to  the list  of                                                               
     persons who  may petition for a  conservatorship and further                                                               
     adds  "or caregiver,  the Department  of  Health and  Social                                                               
     Services" to that list. This  change is necessary to broaden                                                               
     the list  of specific persons  authorized to petition  for a                                                               
     conservatorship   in  aid   of   a   vulnerable  adult   and                                                               
     specifically  to ensure  that the  Department of  Health and                                                               
     Social Services is authorized to do so when necessary.                                                                     
10:28:10 AM                                                                                                                   
Mr.  Sterling summarized  the  remaining  sections and  explained                                                               
that they added financial protective  orders, which would operate                                                               
similarly   to   domestic   violence   protective   orders.   The                                                               
legislation  also  added ex  parte  relief  that would  enable  a                                                               
vulnerable adult or  an intermediary, without a lawyer,  to go to                                                               
any  court and  apply for  protection to  stop ongoing  abuse. He                                                               
explained that  it had become  easy to steal someone's  money and                                                               
identity through technology, and when  people became aware of the                                                               
problem,  they needed  help immediately.  He  furthered that  the                                                               
rationale  behind the  ex parte  relief provision  was to  enable                                                               
victims  to get  immediate  help and  added  that other  sections                                                               
allowed  for  temporary  conservators.  Currently,  the  statutes                                                               
allowed for temporary guardians  but not conservators. He related                                                               
that it  was his experience  that courts were reluctant  to grant                                                               
conservatorships  because they  were not  expressly permitted  by                                                               
statute.  The legislation  authorized by  law the  appointment of                                                               
temporary conservators.  He stated  that the  clarification would                                                               
enhance  the ability  of  victims and  DHSS  to obtain  immediate                                                               
relief for  victims of financial  abuse. He explained  that other                                                               
portions of  bill, which were  largely definitional,  expanded or                                                               
added  the  definition  of  things such  as  fraud,  while  other                                                               
sections  added "undue  influence" into  statue. Under  the undue                                                               
influence statute, there  were specific grounds to  assert that a                                                               
fiduciary was abusing their responsibility.                                                                                     
10:30:56 AM                                                                                                                   
Mr. Sterling responded to Senator  Thomas's earlier question, and                                                               
indicated that the only fiduciaries  in Alaska that were required                                                               
to  be vetted  by a  court  were guardians  and conservators.  He                                                               
stated  that trusts  were  a private  matter  and furthered  that                                                               
although there was a section in  Title 13 that dealt with trusts,                                                               
there were no  requirements that a trustee be vetted  in any way.                                                               
He described  Alaska's POA  statute, found in  Section 13,  as "a                                                               
maximum  utility,  minimal   regulation,  and  minimal  liability                                                               
statute."  There were  currently no  requirements for  serving as                                                               
POA  and  there  were  no   standards,  licensing,  or  liability                                                               
provisions  to  deal  with  abuse.  He  explained  that  "maximum                                                               
utility"  resulted  in  a  greater risk  of  abuse  of  fiduciary                                                               
responsibility from POA.                                                                                                        
In response  to an  earlier question  from Co-Chair  Hoffman, Mr.                                                               
Sterling  indicated that  he was  not looking  at how  the tribal                                                               
courts interfaced  with state  courts when he  drafted SB  86. He                                                               
felt that taking  a look at this aspect was  a "meritorious" idea                                                               
and furthered that he would be "happy" to take a look at it.                                                                    
10:33:19 AM                                                                                                                   
KELLY  HENRIKSEN,  ASSISTANT  ATTORNEY GENERAL,  HUMAN  SERVICES,                                                               
DEPARTMENT OF  LAW, introduced herself.  She stated that  half of                                                               
SB 86 dealt with Adult  Protective Services, which was the office                                                               
she represented.  She indicated  that Mr. Sterling  had presented                                                               
the part of  bill that dealt with  conservatorships and financial                                                               
protective orders, which is found in  Title 13. The part that she                                                               
had  drafted, found  in  Title 47,  dealt  with Adult  Protective                                                               
Services.  The  highlights  of   the  Adult  Protective  Services                                                               
Sections,  which began  at  Section  16 of  the  bill, added  the                                                               
concept  of  "undue influence"  to  the  entire Adult  Protective                                                               
Services  code.  The  legislation updated  the  Adult  Protective                                                               
Services  code to  meet  the  practical needs  of  the time.  She                                                               
stated that  because it permeated what  Adult Protective Services                                                               
did,  the  term  "undue  influence" was  added  anyplace  in  the                                                               
statutes  where it  specified what  kinds  of activities  someone                                                               
might make  a report of  harm about,  such as abuse,  neglect, or                                                               
self-neglect. She related that most  of the Sections in the Adult                                                               
Protective  Services  part of  the  bill  simply added  the  term                                                               
"undue  influence",  but that  there  were  no other  substantive                                                               
changes in  those Sections. She  remarked that  another important                                                               
thing  the Adult  Protective Services  portion of  SB 86  did was                                                               
that it  updated and  added definitions in  the statutes  to more                                                               
accurately reflect reality.                                                                                                     
Ms. Henriksen offered that the  final element worthy of note from                                                               
the portion  of SB 86 that  she had drafted was  that it expanded                                                               
the list of  what services Adult Protective Services  was able to                                                               
provide, short of a guardian  or conservator being appointed. She                                                               
cited examples of these services  as follows: staying a financial                                                               
transaction  at a  bank, assistance  with  a rental  application,                                                               
providing  food,  and  providing  other care  services  an  adult                                                               
needed. She indicated that instead  of doing a guardian's duties,                                                               
Adult  Protective  Services  had  discovered a  need  to  have  a                                                               
clearer definition of what they  could do as an intermediary. She                                                               
concluded by stating  that other than the three  elements she had                                                               
pointed out,  there was  not anything  significant in  the Alaska                                                               
Protective Services portion of the sectional.                                                                                   
Senator Olsen stated that he  assumed the victimization of elders                                                               
represented  the  minority  of  cases  of  financial  abuse.  Ms.                                                               
Henriksen responded  that she  was unsure  if that  statement was                                                               
correct, but indicated that Ms.  Gibbens might be able to respond                                                               
to the question. Senator Olsen  queried if there was strain being                                                               
placed on  individuals who were  complying with the law  and were                                                               
legitimately  trying to  obtain guardianship  or conservatorship.                                                               
He  expressed  concern that  responsible  children  could have  a                                                               
difficult  time obtaining  guardianship  or conservatorship  from                                                               
parents who were not being abused.   Ms. Gibbens replied that she                                                               
did not  believe that to be  true and furthered that  the process                                                               
followed  to gain  guardianship or  conservatorship was  the same                                                               
whether or not an individual  was attempting to take advantage of                                                               
an elder.                                                                                                                       
10:37:31 AM                                                                                                                   
Senator  Thomas referenced  a 25  percent increase  in the  abuse                                                               
rate on  the system over the  last year and asked  if anything in                                                               
SB 86  specifically addressed the issue.  Ms. Henriksen specified                                                               
that  the  ability  to impose  financial  protective  orders  and                                                               
temporary  conservators were  two  additions  that addressed  the                                                               
increase in abuse.                                                                                                              
Senator Thomas queried  if Ms. Henriksen thought  there should be                                                               
a  more thorough  vetting process,  such as  a background  check,                                                               
when  a  guardian or  conservator  was  appointed. Ms.  Henriksen                                                               
responded that if Adult Protective  Services received a report of                                                               
harm,  their investigation  was  "very  thorough". She  mentioned                                                               
that  during an  investigation  informal  background checks  were                                                               
performed, so  that when  the case  was heard  any issue  about a                                                               
potential guardian or conservator would  be raised in open court.                                                               
She concluded  that in her experience,  Adult Protective Services                                                               
did not take  chances when allegations of abuse  had been raised.                                                               
She  furthered that  Adult Protective  Services gathered  as much                                                               
information  as  possible,  so  that the  judge  could  make  the                                                               
decision on who was appropriate.                                                                                                
Ms. Henriksen  revealed that  the transfer of  POA was  a private                                                               
matter that did not require  any state involvement or time before                                                               
a  judge  and explained  that  because  of  this, the  state  was                                                               
unaware and  unable to  affect that  process. She  continued that                                                               
Adult  Protective  Services could  only  get  involved when  they                                                               
received a report of harm, but  that once they were involved, the                                                               
process was thorough.                                                                                                           
Senate  Bill 86  was  HEARD  and HELD  in  Committee for  further                                                               

Document Name Date/Time Subjects
HB 104 - CSHB104(EDC)Sectional ACPE 3 21 11.pdf SFIN 1/18/2012 9:00:00 AM
HB 104
HB 104 - SBOE Letter on APS Resolution to HEDC.pdf SFIN 1/18/2012 9:00:00 AM
HB 104
HB 104 NEW Sectional (RLS).pdf SFIN 1/18/2012 9:00:00 AM
HB 104
HB104 AWIBAPSResolution.pdf SFIN 1/18/2012 9:00:00 AM
HB 104
SB 86 AARP Support.pdf SFIN 1/18/2012 9:00:00 AM
SB 86
SB 86 OLTCO letter of support.PDF SFIN 1/18/2012 9:00:00 AM
SB 86
SB 86 Sectional Analysis.pdf SFIN 1/18/2012 9:00:00 AM
SB 86
SB 86 Sponsor Statement.pdf SFIN 1/18/2012 9:00:00 AM
SB 86
SB 86 summary of changes 4-15-11.pdf SFIN 1/18/2012 9:00:00 AM
SB 86
CS SB 2 Support Letters.PDF SFIN 1/18/2012 9:00:00 AM
SB 2
CS SB 2 DMV Letter.pdf SFIN 1/18/2012 9:00:00 AM
SB 2
CSSB 2 Sponsor Statement.pdf SFIN 1/18/2012 9:00:00 AM
SB 2
SB 2 Explanation of Changes.pdf SFIN 1/18/2012 9:00:00 AM
SB 2
SB 2 Special Request Plates-Fact Sheet.pdf SFIN 1/18/2012 9:00:00 AM
SB 2
SB 86 Support Letter-Office of Long Term Care.pdf SFIN 1/18/2012 9:00:00 AM
SB 86
SB 86 Support Letter-ACoA.pdf SFIN 1/18/2012 9:00:00 AM
SB 86
HB 104 ACPE Letter.pdf SFIN 1/18/2012 9:00:00 AM
HB 104
HB 104 APS Outcomes Report.pdf SFIN 1/18/2012 9:00:00 AM
HB 104
HB 104 DOR Response.pdf SFIN 1/18/2012 9:00:00 AM
HB 104
HB 104 Rodell to SFC 1-30-2012.pdf SFIN 1/18/2012 9:00:00 AM
HB 104