Legislature(2009 - 2010)BELTZ 211

02/23/2009 01:30 PM Senate JUDICIARY


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01:33:12 PM Start
01:33:22 PM SB85
03:01:39 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 85 ALCOHOL: LOCAL OPTION/LICENSING/MINORS TELECONFERENCED
Heard & Held
         SB  85-ALCOHOL: LOCAL OPTION/LICENSING/MINORS                                                                      
                                                                                                                                
1:33:22 PM                                                                                                                    
CHAIR FRENCH announced the consideration of SB 85. [Before the                                                                  
committee was CSSB 85(CRA).]                                                                                                    
                                                                                                                                
ANNE CARPENETI, Criminal Division,  Department of Law (DOL), said                                                               
the  Governor  introduced  SB 85.  Providing  some  history,  she                                                               
explained that  the local option  laws were adopted in  the 1980s                                                               
and at  that time amounts  were set  for various purposes  of the                                                               
local option  law. One purpose  was to establish  that possession                                                               
of a larger amount would be  a presumption of possession for sale                                                               
if a person were prosecuted for bootlegging.                                                                                    
                                                                                                                                
CHAIR FRENCH  asked if the  state was essentially wet  before the                                                               
local  option laws,  meaning that  just one  set of  alcohol laws                                                               
applied statewide.                                                                                                              
                                                                                                                                
MS. CARPENETI replied  she believes so, but  she'll double check.                                                               
The  amounts have  stayed essentially  the same  over the  years.                                                               
Under current  law the  amounts are  set at  10.5 liters  of hard                                                               
alcohol, 24  liters of wine and  12 gallons of malt  liquor. If a                                                               
person is in  possession of more than these amounts  and there is                                                               
other  evidence, that  would be  an evidentiary  presumption that                                                               
the possession  was for  sale. It's  rebuttable and  doesn't mean                                                               
that a  person who possesses more  is going to be  prosecuted for                                                               
bootlegging.                                                                                                                    
                                                                                                                                
CHAIR  FRENCH noted  that discussion  in  the previous  committee                                                               
focused on those numbers as some sort of barrier.                                                                               
                                                                                                                                
MS. CARPENETI  said it's  not a barrier.  These are  amounts that                                                               
they  said  in  the  1980s   could  be  used  as  an  evidentiary                                                               
presumption  that the  possession  was for  purposes  of sale  if                                                               
somebody was being prosecuted for bootlegging.                                                                                  
                                                                                                                                
1:35:52 PM                                                                                                                    
CHAIR FRENCH  observed that a person  who has a wine  cellar with                                                               
200  bottles   of  wine  probably  doesn't   have  a  bootlegging                                                               
operation, but someone  who has 15 cases of whiskey  boxed up and                                                               
ready to go somewhere is an entirely different matter.                                                                          
                                                                                                                                
MS.  CARPENETI agreed.  These  amounts are  also  used for  other                                                               
things  in statute.  For example,  if  a person  is convicted  of                                                               
bootlegging more than 10.5 liters  of hard alcohol, that would be                                                               
the  threshold   amount  between  a  misdemeanor   and  a  felony                                                               
prosecution  for  bootlegging.  She elaborated  that  selling  12                                                               
liters of hard liquor would be a felony bootlegging prosecution.                                                                
                                                                                                                                
Over the  years people  have concluded that  the amounts  are too                                                               
high. That was a consideration  that the Rural Justice Commission                                                               
had; the  Representative from Bethel  expressed the  same concern                                                               
in the House  Finance Committee; last year's  crime bill included                                                               
several  of  the  alcohol provisions;  and  the  House  Judiciary                                                               
Committee  had   discussions  about  reducing  the   amounts.  In                                                               
response to  those considerations, the Governor  introduced SB 85                                                               
to reduce the amounts. That caused  some people who live in rural                                                               
areas and  like to shop  in bulk  some concern. Thus  a committee                                                               
substitute  (CS) was  drafted. It  does not  address the  amounts                                                               
that  give rise  to  the  presumption of  sale  or the  threshold                                                               
between  felony  and misdemeanor.  It  just  addresses the  time.                                                               
Under  the CS  every  two months  a package  store  can send  the                                                               
following  amounts to  a person  living  in a  damp local  option                                                               
community: 10.5 liters  of hard liquor, 24 liters of  wine and 12                                                               
gallons of  malt liquor. Previously  these amounts could  be sent                                                               
every month.                                                                                                                    
                                                                                                                                
1:39:34 PM                                                                                                                    
Section  2  also  adopts  civil  penalties  for  licensees  whose                                                               
employees  or agents  are convicted  of furnishing  alcohol to  a                                                               
minor while on the licensee's  premises. Most of the licensees in                                                               
the state are conscientious, but some  are not as serious so this                                                               
provides  consequences. On  the  first  conviction the  Alcoholic                                                               
Beverage Control Board (ABC) would  send the licensee a letter of                                                               
warning explaining  the consequences for  additional convictions.                                                               
The second and subsequent convictions  would bring a $1,000 civil                                                               
fine to the  licensee whose employee was  convicted of furnishing                                                               
alcohol to a minor on the licensed premises.                                                                                    
                                                                                                                                
Sections  3   and  4  correct   minor  drafting  errors   in  the                                                               
legislation that  was adopted last  year. She explained  that the                                                               
minor  consuming  law has  a  three-step  process to  accommodate                                                               
first   time,  repeat   and  habitual   offences.  In   2001  the                                                               
Legislature adopted  a scheme that  any minor convicted  of minor                                                               
consuming would  be on  probation until they  were 21  years old.                                                               
Last year they changed the probation  period to one year, but the                                                               
drafting  caused some  magistrates  concern that  the law  wasn't                                                               
sufficiently specific  to allow  movement from  step one  to step                                                               
two to step  three. SB 85 clarifies that "step  one is the first,                                                               
step two is  the second and the consequences for  repeat apply to                                                               
anybody who  has a  conviction for their  first offense,  and the                                                               
consequences for  habitual apply to  all minors who have  had two                                                               
incidents of minor consuming in their lives."                                                                                   
                                                                                                                                
1:42:27 PM                                                                                                                    
CHAIR FRENCH noted that Section 3  is for the repeat offender and                                                               
Section 4 is for the habitual offender.                                                                                         
                                                                                                                                
MS.  CARPENETI agreed.  SB 85  also fixes  an inconsistency  that                                                               
resulted   when  the   Legislature   adopted  mandatory   minimum                                                               
sentences for people convicted of  bootlegging. The intention was                                                               
that  those  were  to  be  the  same  as  the  mandatory  minimum                                                               
penalties  for  drunk  drivers. However,  there  is  a  different                                                               
definition  for "previous  conviction" in  the drunk  driving law                                                               
than in the bootlegging law. Section  5 of the bill corrects that                                                               
inconsistency.                                                                                                                  
                                                                                                                                
MS.  CARPENETI characterized  Sections 3,  4, and  5 as  clean up                                                               
provisions. She recapped that the  first new provision relates to                                                               
the amounts of alcohol that a  licensee can send in response to a                                                               
written order  in a two month  period, and the second  relates to                                                               
the civil penalties for licensees.                                                                                              
                                                                                                                                
1:44:01 PM                                                                                                                    
SENATOR ELTON said he continues  to struggle with the amounts. He                                                               
questioned  whether someone  would  be  prohibited from  ordering                                                               
from  more than  one  package  store to  get  a  second or  third                                                               
shipment.                                                                                                                       
                                                                                                                                
MS. CARPENETI  replied that  wouldn't happen  because of  the law                                                               
the Legislature  passed several years ago.  It requires licensees                                                               
who send  alcohol to  local option communities  in response  to a                                                               
written order to  check a database to see  whether the individual                                                               
has made other orders.                                                                                                          
                                                                                                                                
SENATOR  ELTON commented  that squeezing  a balloon  in one  spot                                                               
causes  a bulge  in another.  Four adults  living in  a household                                                               
could order  42 liters  of hard  alcohol and  he wonders  if this                                                               
solution may encourage other people  to get in on illegal profits                                                               
that accrue because of bootlegging.                                                                                             
                                                                                                                                
MS. CARPENETI said  there isn't a magic  solution to bootlegging.                                                               
Over the  years there  have been  a number  of solutions  and the                                                               
database  was  particularly  helpful.  Under  current  law,  four                                                               
adults in  a family could  order four times the  amounts outlined                                                               
above. This bill doesn't change that                                                                                            
                                                                                                                                
SENATOR ELTON said he continues  to struggle with the amounts and                                                               
he isn't sure he'd want to  be a neighbor of someone who consumes                                                               
that much alcohol  in two months. The only reason  he could think                                                               
of for ordering  that much would be  to sell it or  give it away.                                                               
"That's a lot of booze."                                                                                                        
                                                                                                                                
MS. CARPENETI pointed  out that under current law  every adult in                                                               
a damp community  can order that much every month.  SB 85 changes                                                               
that to every two months.                                                                                                       
                                                                                                                                
CHAIR FRENCH  asked testifiers to  limit their comments  to three                                                               
minutes.                                                                                                                        
                                                                                                                                
1:48:18 PM                                                                                                                    
MICHELLE  DEWITT,  Director,  Tundra Women's  Coalition,  Bethel,                                                               
stated that  she has  reviewed the  CRA committee  substitute and                                                               
she appreciates  the state looking  at ways to address  the issue                                                               
of alcohol abuse in rural  Alaska. She serves victims of domestic                                                               
violence  and sexual  assault and  from  her perspective  alcohol                                                               
abuse is  a major factor  in crime.  She realizes that  there are                                                               
different perspectives on the bill,  but she appreciates that the                                                               
state is  looking at efforts  to make  a difference in  regard to                                                               
domestic violence and sexual assault.                                                                                           
                                                                                                                                
1:50:03 PM                                                                                                                    
SENATOR  THERRIAULT  noted  that   his  staff  provided  a  sheet                                                               
indicating what  the liter amounts  break down  to in terms  of 8                                                               
ounce  cup  servings.  From his  perspective  it's  a  staggering                                                               
amount of  alcohol on a daily  basis. "So having it  be every two                                                               
months knocks it down to a  little bit more reasonable level," he                                                               
said.                                                                                                                           
                                                                                                                                
CHAIR FRENCH thanked him for the  work and said he may refine the                                                               
measures further.                                                                                                               
                                                                                                                                
1:51:53 PM                                                                                                                    
JODY MALUF,  representing herself  from Bethel, said  her husband                                                               
is a long-time  teacher at the high school and  she is well aware                                                               
of what alcohol  can do to a family and  a community. However, SB
85 treats everyone  who resides in a local option  community as a                                                               
second-class  citizen.  It  combines  ridiculous  limitations  on                                                               
liquor  with punishments  for furnishing  alcohol to  minors. She                                                               
questioned  why  the  drafters   would  include  protections  for                                                               
minors,  which  everyone  wants, with  required  punishments  for                                                               
"innocent law  abiding citizens." It forces  legislators to think                                                               
that  passing  the bill  equates  to  having family  values.  She                                                               
questioned   why  their   former  Representative   requested  the                                                               
legislation from  the Governor and  why it is  being fast-tracked                                                               
at  the  Governor's  request.  "There is  an  agenda  here,"  she                                                               
asserted.                                                                                                                       
                                                                                                                                
CHAIR  FRENCH  assured her  that  the  bill would  be  thoroughly                                                               
considered as it goes through the system.                                                                                       
                                                                                                                                
1:54:18 PM                                                                                                                    
DAVE TRANTHAM,  representing himself and his  family from Bethel,                                                               
said  SB  85  will  not   serve  the  intended  purpose  and  has                                                               
unintended consequences. Bootlegging  will continue regardless of                                                               
the limits that  are set. The citizens of Bethel  voted for local                                                               
option because it  was the best option, but since  then it's been                                                               
tweaked many times. The initial  understanding was that the local                                                               
people  had some  say.  That  is no  longer  the  case and  local                                                               
citizens  have  no  control.   "The  Legislature  is  controlling                                                               
everything."  He believes  that the  community will  petition and                                                               
opt out of  local option within a week of  this bill passing. The                                                               
community  council  meets  tomorrow   to  consider  a  resolution                                                               
opposing SB 85.  Education is the answer. It's time  to teach the                                                               
people in  Bethel how to  drink and  how to stop  binge drinking.                                                               
Liquor is one of the big  economic drivers in Bethel and accounts                                                               
for  jobs in  healthcare and  government. SB  85 won't  serve the                                                               
people of Bethel.                                                                                                               
                                                                                                                                
1:59:51 PM                                                                                                                    
THOMAS  HAWKINS,  representing  himself  from  Bethel,  said  the                                                               
community  voted  for  local  option but  they  never  voted  for                                                               
limits.  The Legislature  and Juneau  is trying  to override  our                                                               
local option, he said.                                                                                                          
                                                                                                                                
SENATOR ELTON pointed out that Juneau  has nothing to do with any                                                               
of the changes  other than his single vote. The  community is not                                                               
doing this, it is a group  of legislators who operate by majority                                                               
vote.                                                                                                                           
                                                                                                                                
MR. HAWKINS said he didn't intend  to single out the community of                                                               
Juneau. He did intend to single out the Legislature.                                                                            
                                                                                                                                
2:02:16 PM                                                                                                                    
KEVIN CARTER, representing himself from  Bethel, said he wants to                                                               
reiterate  what   Mr.  Hawkins  and  Mr.   Trantham  said.  "It's                                                               
depressing to  know that  we're being told  by people  that don't                                                               
live in  the Bush and don't  know how things work  out here, what                                                               
we can  and can't do and  how much of  it we can do."  This won't                                                               
solve the  problems here because  bootleggers will find a  way to                                                               
continue.  This  will  simply  drive  the  prices  of  bootlegged                                                               
alcohol even  higher. The community  swallowed the  database, but                                                               
we won't swallow this, he said.                                                                                                 
                                                                                                                                
CHAIR FRENCH  said the comments  today have prompted him  to look                                                               
into how close the recent votes have been in Bethel.                                                                            
                                                                                                                                
2:05:14 PM                                                                                                                    
ERIC  MIDDLEBROOK, representing  himself  from  Bethel, said  the                                                               
most recent vote  was to pass a city ordinance  allowing only the                                                               
citizens of Bethel to vote on  whether or not to allow a delivery                                                               
site and to  say that the city council did  not have authority to                                                               
establish a centralized  delivery site for alcohol.  The vote was                                                               
85 percent  in favor  of retaining voter  control on  that issue.                                                               
Most  local option  votes asking  about  a change  to either  wet                                                               
status or dry  status have been turned down  2:1. Bethel citizens                                                               
are adamant  about maintaining the  status quo and this  bill has                                                               
been a  wake-up call. The  state has taken  a number of  steps to                                                               
take control  away from the  residents. "We just feel  that we've                                                               
been backed into a corner and  we have no other options here," he                                                               
said.                                                                                                                           
                                                                                                                                
2:07:44 PM                                                                                                                    
GARY   VANASSE,   representing   himself  from   Bethel,   stated                                                               
opposition to SB 85. In the 24  years he has lived in Bethel, the                                                               
residents  have voted  on local  option status  many times.  "The                                                               
result of that  vote every single time has been  to retain a damp                                                               
status." He  feels that  the community  should maintain  its damp                                                               
status,  but this  bill could  result in  the community  having a                                                               
local option election  to create a wet status.  Already there has                                                               
been  an increase  in homebrew  operations  and drug  use and  he                                                               
worries  that will  escalate. He  believes that  money should  be                                                               
spent   on  undercover   investigations  to   round  up   illegal                                                               
activities  such as  bootlegging  and drug  dealing. "We  haven't                                                               
seen that here in Bethel in quite some time," he said.                                                                          
                                                                                                                                
The alcohol limits  that were set in the late  1980s haven't done                                                               
much to solve  alcohol-related problems in the  Bethel region and                                                               
he doesn't  believe the new  limits will have the  desired effect                                                               
either.  "Lets  treat the  disease,  not  the symptom."  Let  the                                                               
citizens of  Bethel make their  own decisions and don't  get over                                                               
focused on amounts, he said.                                                                                                    
                                                                                                                                
2:13:54 PM                                                                                                                    
THOR  WILLIAMS, representing  himself  from  Bethel, thanked  the                                                               
members for  doing the business  of the  state. A point  he would                                                               
like  to  make is  that  there  has been  a  rise  in numbers  of                                                               
community members who  are ordering alcohol now that  there is an                                                               
electronic  delivery site  within the  community. That  basically                                                               
means  that  people are  ordering  alcohol  when they  never  did                                                               
before. He reminded members that  Bethel residents pay freight on                                                               
alcohol when  it is  shipped to  Anchorage and  again when  it is                                                               
shipped to  Bethel. That is a  large cost and the  consumer saves                                                               
money  if they  buy in  bulk. Another  thing to  realize is  that                                                               
Bethel could potentially  lose revenue because they  gain fees on                                                               
alcohol purchased  in Anchorage.  That money  is used  to provide                                                               
services in the community so  limiting the amount of alcohol that                                                               
could  be delivered  would amount  to a  cut in  revenue for  the                                                               
community.  That   could  cause  loss  of   employment  for  city                                                               
employees. Opting out  of local option is an  up-coming issue and                                                               
he has  asked the ABC board  to talk to the  community council on                                                               
March 10 about  what that means. It could be  that it would cause                                                               
more problems than  it's worth. The community simply  wants to be                                                               
left alone.                                                                                                                     
                                                                                                                                
MR.  WILLIAMS asked  if the  communities of  Anchorage, Fairbanks                                                               
and Juneau would like to be  told how much alcohol they should or                                                               
should not drink  in a month. Bethel has problems  with drugs and                                                               
alcohol, but these  other communities do as well.  This isn't the                                                               
solution and  he would like  the committee to  break up SB  85 to                                                               
address the different issues in the bill individually.                                                                          
                                                                                                                                
2:17:23 PM                                                                                                                    
OLIE OLSON,  representing himself,  said he  has lived  in Bethel                                                               
for 30 years and he agrees  with the previous testimony. He wants                                                               
to be  treated like any  other citizen  of Alaska is  treated. He                                                               
doesn't think SB  85 will help with the  bootlegging problem, but                                                               
it will make it more expensive.                                                                                                 
                                                                                                                                
2:18:29 PM                                                                                                                    
WILSON  JUSTIN, Vice  President of  Health, Mount  Sanford Tribal                                                               
Consortium,  Chistochina  Village, said  he  also  serves on  the                                                               
Alaska Rural Justice and Law  Enforcement Commission. His remarks                                                               
primarily  target  Section  1  of   SB  85  and  he  supports  it                                                               
unilaterally.  Over many  years  he has  dealt  with alcohol  and                                                               
substance abuse issues  in a number of  forums including prisons,                                                               
the legal arena, the courts and  health. Health care is a billion                                                               
dollar  industry  in Alaska  and  between  two-thirds and  three-                                                               
fourths  of the  cost of  delivering  health care  is related  to                                                               
alcohol and substance abuse. That's  astonishing but it's a given                                                               
in the  health industry.  He thanked  the committee  and restated                                                               
his support for SB 85.                                                                                                          
                                                                                                                                
CHAIR FRENCH thanked him for his contributions to the state.                                                                    
                                                                                                                                
2:20:47 PM                                                                                                                    
CEZARY  NACZYNSKI,  representing  herself from  Bethel,  said  he                                                               
strongly opposes SB  85. The bill isn't only  about alcohol, it's                                                               
about who can make decisions  for a community. He supports strong                                                               
punishment  for  bootlegging  and  he  supports  the  freedom  of                                                               
choice. "Just let me decide what  I'm going to eat today and what                                                               
I'm going to drink  and how much I'm going to  drink." He came to                                                               
this country to enjoy the freedoms  and he would like the freedom                                                               
to choose.                                                                                                                      
                                                                                                                                
2:24:02 PM                                                                                                                    
LARRY HACKENMILLER,  representing himself, Fairbanks, said  he is                                                               
here  to testify  against SB  85.  In particular  he opposes  the                                                               
$1,000  penalty as  a consequence  for a  licensee. Basically  it                                                               
says that after all the  training an employee receives, the owner                                                               
will  be  fined  $1,000,  without due  process,  for  the  second                                                               
conviction of a bartender. "Even  with the training that we have,                                                               
they make  a mistake  and yet  we are  now held  accountable," he                                                               
said. The  ABC board  has the  authority under  Title IV  to make                                                               
decisions with regard  to penalties so it's uncalled  for to give                                                               
him a $1,000 fine as outlined in the bill.                                                                                      
                                                                                                                                
MR.  HACKENMILLER  said  this  is  supposed  to  a  standard  for                                                               
bootlegging;  it  isn't supposed  to  solve  the social  problems                                                               
alcohol causes,  but he  keeps hearing people  say it  will help.                                                               
Dry villages  have zero  limits for alcohol  and they  still have                                                               
problems. Bethel is  basically saying it wants to  handle its own                                                               
problems.  He  disagrees  with  DOL   saying  that  that  it's  a                                                               
rebuttable presumption  because discovering  over 10.5  liters of                                                               
whiskey is  at the bootlegging  level. The reason the  half liter                                                               
is there  is because  someone might have  alcohol left  over when                                                               
they ordered more. "You're going  to make criminals out of people                                                               
that are not involved in a criminal activity," he said.                                                                         
                                                                                                                                
MR. HACKENMILLER cautioned  the committee to stay  on point. This                                                               
is a  bootlegging bill  and it isn't  supposed to  address social                                                               
problems.  Corrective   language  for  underage   consumption  is                                                               
covered in  another bill so  this bill  needs go no  further. The                                                               
$1,000  penalty for  a licensee  provides no  due process.  He is                                                               
guilty until proven  innocent and it's the  same for bootleggers.                                                               
"When you find 12 bottles of liters  in my house, I have to prove                                                               
my innocence. That's my rebuttal but  I still have to do that. If                                                               
it's a criminal crime it should  be criminal, but a civil penalty                                                               
of $1,000 [is] way too out of line  and I'm not given a chance to                                                               
defend myself," he said.                                                                                                        
                                                                                                                                
CHAIR FRENCH observed  that he would pity the trooper  and the DA                                                               
who  tried to  bring a  slightly-over-the-limit bootlegging  case                                                               
against  a Bethel  resident because  the citizens  would look  at                                                               
that with a jaundiced eye.                                                                                                      
                                                                                                                                
MR. HACKENMILLER said we don't need the law.                                                                                    
                                                                                                                                
CHAIR FRENCH said he used  Senator Therriault's numbers and based                                                               
on a  two month  total he  calculated that  someone could  ship 6                                                               
ounces of  whiskey per day  to a citizen,  13 ounces of  wine per                                                               
day to  a citizen  and 25 ounces  of beer per  day to  a citizen.                                                               
Debate can  take place  on what the  appropriate level  should be                                                               
but that's  the math as far  as the restrictions on  shipment, he                                                               
said.                                                                                                                           
                                                                                                                                
2:29:48 PM                                                                                                                    
DARWIN  BIWER,  Chair,  Statewide   Cabaret  Hotel  Restaurant  &                                                               
Retailers  Association  (CHARR),  said  CHARR  represents  liquor                                                               
licensees  across the  state  and they  oppose  the provision  in                                                               
Section 2 that  gives a $1,000 civil fine to  the licensee for an                                                               
employee's action. This isn't  right because legitimate licensees                                                               
aren't  trying  to  sell  to  minors.  Anchorage  CHARR  has  put                                                               
together an in-house compliance check  and has a pilot program in                                                               
Kodiak  as well.  This is  in  addition to  the state  compliance                                                               
checks by  state troopers and  is an  effort to keep  the numbers                                                               
down  and  keep  people  informed. All  servers  and  owners  are                                                               
required to take courses on  the techniques of alcohol management                                                               
(TAM) and renew them every  three years. When mistakes happen-and                                                               
they do-the perpetrator  should be responsible, not  the owner of                                                               
the bar.                                                                                                                        
                                                                                                                                
MR. BIWER  said he knows  that this legislation came  from social                                                               
service and  welfare organizations.  The liquor industry  was not                                                               
involved and was not consulted.  "We're completely ignored yet it                                                               
puts a penalty on our industry  and on our people and that's just                                                               
not right either," he said.                                                                                                     
                                                                                                                                
2:33:06 PM                                                                                                                    
MR. BIWER  reported that national  statistics show  that underage                                                               
drinkers get alcohol  from their parents 65 percent  of the time.                                                               
The second most  common way is through friends  and relatives and                                                               
the  third way  is  the  shoulder tap,  which  is where  underage                                                               
drinkers gets someone to buy  alcohol for them. Another venue for                                                               
getting  alcohol  is  the afterhours  clubs,  which  are  illegal                                                               
unlicensed  operations.  They sell  liquor  and  other things  to                                                               
underage people and the onus  comes down on legitimate licensees.                                                               
In closing he  said owners and licensees should  not be penalized                                                               
for something that somebody else does.                                                                                          
                                                                                                                                
2:35:10 PM                                                                                                                    
SENATOR  ELTON asked  if this  will  create a  situation where  a                                                               
bartender may lose his or her  job if they make a mistake because                                                               
the owner doesn't want to risk getting a $1,000 penalty.                                                                        
                                                                                                                                
MR. BEELER said that could happen.                                                                                              
                                                                                                                                
SENATOR  THERRIAULT said  he appreciates  the industry  trying to                                                               
police itself  to get rid of  bad actors. He asked  how a history                                                               
of compliance mistakes  comes into play when a  liquor license is                                                               
evaluated by local government and the ABC board.                                                                                
                                                                                                                                
MR. BEELER  explained that the Anchorage  Police Department (APD)                                                               
tracks all  visits to  bars and the  citations. In  Anchorage all                                                               
liquor licenses  are approved by  the municipal assembly  and the                                                               
ABC board is part of the system as well.                                                                                        
                                                                                                                                
SENATOR THERRIAULT asked if the owner  is at risk of losing their                                                               
license if their business has proved to be a problem.                                                                           
                                                                                                                                
MR. BEELER said  yes; the assembly makes a  recommendation to the                                                               
ABC board, which has the final say on the license.                                                                              
                                                                                                                                
2:38:17 PM                                                                                                                    
CHAIR FRENCH noted  that Commissioner Masters and  John Glick are                                                               
online and available for questions.                                                                                             
                                                                                                                                
DIANE   CASTO,  Manager,   Prevention   and  Early   Intervention                                                               
Services,  Division of  Behavioral  Health  (DBH), Department  of                                                               
Health  and Social  Services (DHSS),  said she  is testifying  on                                                               
behalf  of DHSS  in support  of  SB 85  She has  listened to  the                                                               
testimony today  and during previous  hearings and  believes that                                                               
there's truth to  everything that's been said. Alcohol  is a huge                                                               
problem in this state. In the  last several years DHSS received a                                                               
contract from  the federal  government that  made it  possible to                                                               
put  together a  state epidemiological  profile on  substance use                                                               
and abuse  and dependency within  Alaska. Not  surprisingly, they                                                               
found that  the drug of  choice in  Alaska is alcohol.  People in                                                               
this state  drink a lot  of alcohol  and that causes  an enormous                                                               
number of  problems. The  reality is that  SB 85  absolutely will                                                               
not  solve  all the  problems,  because  solving substance  abuse                                                               
requires a  multi-strategy approach.  "It's a  big issue,  it's a                                                               
big  problem  and   it  needs  to  be  looked  at   from  a  very                                                               
comprehensive approach."                                                                                                        
                                                                                                                                
MS. CASTO  cited statistics from  the federal division  of public                                                               
health violent  death and  unintentional death  reporting system.                                                               
Between 2001  and 2004 the  leading causes of premature  death in                                                               
Alaska  include  chronic   liver  disease,  cirrhosis,  homicide,                                                               
suicide  and unintentional  injury. The  majority are  associated                                                               
with alcohol use.                                                                                                               
                                                                                                                                
Alaskans consume  all alcoholic beverages  at a higher  rate than                                                               
the national  average and  hard liquor  consumption is  1.5 times                                                               
higher  than the  national average.  The federal  50-state annual                                                               
household survey  indicated that 50  percent of adults  in Alaska                                                               
report current alcohol  use. The prevalence of  binge drinking in                                                               
this state is  the highest in the nation,  particularly for those                                                               
between  the ages  of  18  and 34.  Approximately  16 percent  of                                                               
hospitalized  injuries  are  associated   with  alcohol  use,  32                                                               
percent  of motor  vehicle crashes  involved alcohol  use and  31                                                               
percent of motorcycle crashes involved alcohol.                                                                                 
                                                                                                                                
2:43:40 PM                                                                                                                    
MS. CASTO explained  that a standard drink is 12  ounces of beer,                                                               
8 ounces of  malt liquor, 5 ounces  of wine and 1.5  ounces of 80                                                               
proof  alcohol. According  to the  federal Dietary  Guideline for                                                               
Americans: moderate drinking  is defined as no more  than 1 drink                                                               
per day for  women and 2 drinks  for men; heavy is  defined as an                                                               
average  of more  than 2  drinks per  day for  women or  men; and                                                               
binge drinking  is an average  of 4  or more drinks  per occasion                                                               
for women and 5 or more drinks per occasion for men.                                                                            
                                                                                                                                
The  Division  of Behavioral  Health  does  a  lot of  work  with                                                               
underage  drinking   and  it's  clearly  another   problem  area.                                                               
According to  the 2007 Youth  Risk Behavior Survey,  73.6 percent                                                               
of students reported  having had at least one  alcoholic drink on                                                               
one or more days during their  lifetime and 20.4 percent of those                                                               
students  reported having  their  first drink  of alcohol  before                                                               
they were  13 years of  age. She  noted that research  shows that                                                               
drinking before the  age of 15 markedly  increases the likelihood                                                               
of having  lifelong trouble  with alcohol.  Also 39.7  percent of                                                               
students reported having had one  or more alcoholic drinks in the                                                               
last 30 days. The good news  is that consumption of alcohol among                                                               
young people is starting to go down.                                                                                            
                                                                                                                                
MS.  CASTO said  the  message from  DHSS is  that  it supports  a                                                               
multi-strategy approach and  SB 85 is one piece  of the strategy.                                                               
With respect to Section 2,  which pertains to licensees, she said                                                               
she  would agree  with a  previous  testifier that  just a  small                                                               
percentage of alcohol is purchased  by youth in package stores or                                                               
bars.  However, it's  important to  look  at the  many ways  that                                                               
youths get  alcohol and  retailers certainly are  a piece  of the                                                               
picture. DHSS believes the laws  for alcohol should be similar to                                                               
the laws  for tobacco. There  is a fine  for the clerk  who sells                                                               
tobacco to  a minor and it  has a penalty for  the licensee. That                                                               
reinforces that  the issue is  serious and everyone needs  to pay                                                               
attention to  it. There is  due process related to  compliance to                                                               
tobacco laws and  she assumes that would be the  case for alcohol                                                               
as well.  Before the very  strict laws and penalties  for selling                                                               
tobacco to  minors there  was a  40 percent  sell rate,  and this                                                               
year it had  dropped to about 12 percent. It's  important to have                                                               
a strong statement and penalties  to reinforce that keeping these                                                               
dangerous  substances  out  of  the   hands  of  youth  is  taken                                                               
seriously.                                                                                                                      
                                                                                                                                
2:48:28 PM                                                                                                                    
CHAIR FRENCH  asked who  tracks the number  of incidents  of bars                                                               
having sold alcohol to minors in any given year.                                                                                
                                                                                                                                
MS.  CASTO surmised  that it's  the  ABC board.  The Division  of                                                               
Juvenile  Justice receives  federal funding  to enforce  underage                                                               
drinking laws  and they  monitor compliance  checks. She  said it                                                               
provides  perspective  to  understand  that in  Alaska  just  one                                                               
person  does   compliance  checks   for  alcohol  and   three  do                                                               
compliance checks  for tobacco. Clearly, just  a small percentage                                                               
of sales are monitored.                                                                                                         
                                                                                                                                
2:49:46 PM                                                                                                                    
SENATOR THERRIAULT  observed that  alcohol licensees come  up for                                                               
comment and recommendation by  local government and noncompliance                                                               
could  potentially jeopardize  the continuation  of the  license,                                                               
but there isn't a similar mechanism for tobacco.                                                                                
                                                                                                                                
MS. CATO  clarified that  it's actually  tougher for  the tobacco                                                               
industry. Selling to a minor the  first time results in a fine to                                                               
the clerk,  a fine to  the owner and  a 20-day suspension  of the                                                               
tobacco endorsement, which is required  in order to sell tobacco.                                                               
Suspension  of  the  tobacco   endorsement  increases  with  each                                                               
subsequent  offense and  for some  businesses that  amounts to  a                                                               
significant loss of revenue.                                                                                                    
                                                                                                                                
2:51:12 PM                                                                                                                    
RODNEY DIAL, Lieutenant, Department  of Public Safety (DPS), told                                                               
the committee  that he has  lived, gone  to school and  worked in                                                               
Bethel. He  said DPS supports SB  85 and doesn't believe  it will                                                               
hinder  the average  Alaskan importing  alcohol into  their local                                                               
option community  for their  own legal use.  But DPS  believes it                                                               
will impact the illegal distribution  of alcohol into restrictive                                                               
communities, which will reduce violent  crime. He noted that it's                                                               
not  a finding  of  guilt if  someone is  in  possession of  more                                                               
alcohol than the  specified amount. It's only  a presumption that                                                               
the person possesses the alcoholic  beverage for purpose of sale.                                                               
Law enforcement  in the community  and the DA's office  both look                                                               
at those cases carefully for the intent.                                                                                        
                                                                                                                                
CHAIR FRENCH said it agrees that  the bill doesn't set a personal                                                               
limit for possession.  However, the language on page  2, lines 8,                                                               
9  and  10  restricts  the  amount that  can  be  shipped  to  an                                                               
individual and  that essentially puts  a de facto limit  on them.                                                               
An individual  may have  a legitimate  explanation for  having 10                                                               
cases of beer in their  possession and law enforcement may decide                                                               
not to charge  the person with bootlegging. But the  fact is that                                                               
individuals will  have a  hard time  assembling over  the allowed                                                               
amount unless they  are able to convince people  that don't drink                                                               
to ship alcohol, which isn't a good policy.                                                                                     
                                                                                                                                
CHAIR FRENCH observed that the bill  seems to be designed to help                                                               
law enforcement  make cases that are  in the gray area.  A person                                                               
who has  12 liters of  distilled spirits, for example.  Under the                                                               
old standard that might be too  close to the line to bother with,                                                               
but  lowering the  standard would  make it  more likely  that the                                                               
prosecution would be successful. If  someone literally had a boat                                                               
full  of alcohol  there would  be  no question,  but other  cases                                                               
would be less  clear. He asked how many cases  would fall in that                                                               
gray zone.                                                                                                                      
                                                                                                                                
2:54:51 PM                                                                                                                    
LIEUTENANT  DIAL  said they  see  both.  Some cases  are  obvious                                                               
because  they're extremely  over the  limit, but  there are  also                                                               
cases where  the amount is  just under  the legal limit  and it's                                                               
just one  type and  brand of  alcohol and  it's packaged  so it's                                                               
hidden from view.  Those are the types of cases  that SB 85 would                                                               
allow law  enforcement to address.  "We suspect we know  what the                                                               
intent is  and where that  alcohol is going  to wind up  and that                                                               
it's not going to be for a good use."                                                                                           
                                                                                                                                
CHAIR FRENCH asked if he has worked these cases.                                                                                
                                                                                                                                
LIEUTENANT  DIAL   said  yes.  Currently  he   supervises  patrol                                                               
functions  in   Southeast,  which   includes  the   local  option                                                               
community of Angoon.                                                                                                            
                                                                                                                                
SENATOR  THERRIAULT   referenced  Senator  French's   example  of                                                               
someone who  has a wine cellar  and asked how DPS  handles issues                                                               
of a person  who is accumulating for a Christmas  party, and over                                                               
time they exceed the allowed amounts.  He asked how easy it would                                                               
be  for  a  person  under   that  circumstance  to  exercise  the                                                               
rebuttable presumption.                                                                                                         
                                                                                                                                
LIEUTENANT DIAL said  part of the investigation would  be to talk                                                               
to  the  person  to  figure  out  their  intent.  If  there  were                                                               
mitigating factors, officers wouldn't  necessarily make an arrest                                                               
that day. They  would refer it to the  district attorney's office                                                               
for review. In his 19 years  as a state trooper he can't remember                                                               
a case  where they charged  someone who  was bringing in  wine to                                                               
stock  their  private cellar.  He  doesn't  remember anyone  ever                                                               
saying they were stocking up for a holiday event either.                                                                        
                                                                                                                                
2:58:23 PM                                                                                                                    
SENATOR ELTON  said it  would be helpful  to understand  why this                                                               
doesn't apply to him because he  lives in an urban center, but it                                                               
does apply  to someone who  lives in  a damp community.  Also, he                                                               
questions   what   happens   if   new   standards   are   applied                                                               
retroactively  because  there  are policy  implications  if  this                                                               
causes some  communities to  return to a  wet designation  from a                                                               
current damp designation.  "I'm sure there's a  legal answer that                                                               
says … you can apply a  different standard to me than to somebody                                                               
in Bethel. I just need to know what it is."                                                                                     
                                                                                                                                
CHAIR FRENCH speculated  that the community voted  itself damp at                                                               
a  particular  level  or  amount  of  allowable  alcohol  and  he                                                               
believes the Legislature  is able to change those  limits for the                                                               
future. That being  said, he agrees that there is  an issue about                                                               
whether  those voters  now  are getting  what  they thought  they                                                               
voted on to get a damp designation.                                                                                             
                                                                                                                                
He  told DOL  he'd be  interested in  knowing how  many cases  of                                                               
bootlegging were referred for prosecution  last year and what the                                                               
outcomes were.  He then asked  the ABC  board to report  how many                                                               
bars  were  cited  for  selling to  underage  minors  last  year.                                                               
Finally  there's  a policy  question  for  Ms. Carpeneti;  Barrow                                                               
voted to  lower its  alcohol limits below  what the  state allows                                                               
and he wonders why Bethel shouldn't  be allowed to set the limits                                                               
for  the rebuttable  presumption and  shipment amounts  if that's                                                               
their choice.                                                                                                                   
                                                                                                                                
CHAIR FRENCH held SB 85 in committee.                                                                                           

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