Legislature(2013 - 2014)BELTZ 105 (TSBldg)
04/16/2014 09:30 AM Senate JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| HB127 | |
| HB60 | |
| HB140 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 127 | TELECONFERENCED | |
| + | HB 140 | TELECONFERENCED | |
| + | HB 60 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 140-REGULATIONS: NOTICE, REVIEW, COMMENT
10:07:21 AM
CHAIR COGHILL reconvened the meeting and announced the
consideration of HB 140. "An Act relating to the proposed
adoption, amendment, or repeal of a regulation; and relating to
contact with agencies about regulations." He noted the new
Senate committee substitute (CS) and asked Senator Dyson to
rescind the motion to adopt Version K.
SENATOR DYSON rescinded the motion to adopt Version K Senate CS
for HB 140.
10:07:43 AM
SENATOR DYSON moved to adopt the work draft Senate CS for CSHB
140, labeled 28-LS0478\L, as the working document.
CHAIR COGHILL objected for discussion purposes.
10:08:49 AM
JORDAN SHILLING, Aide, Senate Judiciary Standing Committee,
described the three main changes between Version K and Version L
of HB 140. First, the exemption for the Alaska Public Offices
Commission (APOC) was removed throughout the bill. The affected
sections are 2-8. The second large change appears on page 2,
line 5. Following the words "30 days" the phrase "after the
approval is prepared under AS 44.62.060(b)" was removed. The
intent is to keep the review within the tight 30 day window and
not include a reference to the statute that outlines how a state
agency prepares and files regulations. The third major change
removed the exemptions in Section 9. Both the sponsor and the
Department of Law agree that they weren't necessary.
CHAIR COGHILL noted that he and the sponsor hadn't agreed about
the exemptions for the Regulatory Commission of Alaska (RCA),
the Board of Fisheries, the Board of Game, and the Alaska Oil
and Gas Conservation Commission (AOGCC). He asked the sponsor to
comment.
10:10:23 AM
REPRESENTATIVE LORA REINBOLD, Alaska State Legislature, Juneau,
Alaska, sponsor of HB 140 said she was happy with the changes in
Section 2 that removed duplication that could delay regulations,
and she wouldn't object to the exemptions mentioned above.
However, she wanted it on the record that many constituents want
the Board of Game and the Board of Fisheries to be mindful that
the 100,000 Alaskans who hunt and fish want their boards to be
very pro-Alaskan. Also, the RCA should be on notice that
Alaskans and the legislature want a business-friendly climate
and affordable energy for all citizens, businesses, schools, and
governments.
She and the other sponsors would like all agencies, boards, and
commissions to comply with the requirements in Section 5. Many
boards and commissions already post notice of proposed
regulations on their own websites so it wouldn't be difficult to
also post the information on the Alaska Online Publication
Notice System. Section 6 requires a notice to include a brief,
clear description of the impact of the regulation. This is
already a requirement in statute. She noted that her staff
brought examples of a brief description of a Board of Game
regulation.
10:15:13 AM
CRYSTAL KOENEMAN, Staff, Representative Lora Reinbold, Alaska
State Legislature, Juneau, Alaska, sponsor of HB 140, read
examples of acceptable descriptions.
· The Alaska Board of Fisheries calls for proposed changes in
the subsistence, personal use, sport, guide sport, and
commercial fishing regulations for the Prince William Sound
and the upper Copper/Susitna finfish, in Southeast and
Yakutat finfish areas, in Southeast and Yakutat crab -
king, tanner, Dungeness - shrimp, miscellaneous shellfish,
and statewide except Southeast and Yakutat areas, Dungeness
crab, shrimp, miscellaneous shellfish areas.
· The Alaska Board of Game calls for proposed changes in the
regulations pertaining to hunting, trapping, and the use of
game for the following regions: Southeast region,
Southcentral region, Central and Southwest region.
REPRESENTATIVE REINBOLD continued to comment on Version L. She
said she and the sponsors have no objection to sections 7-11.
She concluded that it's good public policy to make the
regulatory process more business and people friendly and more
transparent.
SENATOR MCGUIRE thanked the sponsor for bringing the legislation
forward and the chair for being statesman in making compromises.
10:19:41 AM
NORMAN ROKEBURG, Commissioner, Regulatory Commission of Alaska
(RCA), Anchorage, Alaska, stated that the RCA does not oppose
Version L of HB 140. He said that the RCA takes pride in its
best practices methods for undertaking rulemaking and its
transparent public process. Regulations are adopted at public
meetings and the records are available online. He described it
as the most transparent method of regulatory development in the
state. Addressing an apparent misunderstanding on the
distinction between ratemaking and rulemaking, he clarified that
HB 140 is talking about rulemaking, which is the process for
changing regulations. The dockets regarding ratemaking are
handled under different procedural methods and are almost
totally judiciary in context.
He requested that the sponsor return for another visit so he
could walk her through the rulemaking process, which could be a
template for other state agencies. He concluded stating that
Version L would not prompt a fiscal note from the RCA.
10:23:31 AM
SENATOR DYSON asked if he had concerns that adversarial groups
could flood an agency with superfluous requests.
MR. ROKEBURG agreed that the RCA is vulnerable to that type of
attack, but it has a complaint section and hopefully will be
able to shield itself.
SENATOR MCGUIRE asked if he had objection to the requirement in
Section 5 to post a notice on the Alaska Online Public Notice
System and if it was a fair characterization to say that it was
already a requirement in statute. She also asked if he had any
objection to the requirement in Section 6 to provide a brief
description of changes to the regulation that a layperson could
understand.
MR. ROKEBURG said his understanding is that the RCA is required
by statute to post an online notice of regulation changes and he
believes they already exceed that requirement. The problem with
the requirement in Section 6 is that the complexity of the
issues makes brief descriptions difficult. Executive summaries
are provided. He deferred further response to Stuart Goering.
10:26:45 AM
STUART GOERING, Assistant Attorney General, Civil Division,
Commercial and Fair Business Section, Department of Law,
Anchorage, Alaska, said that with regard to Section 5, the RCA
already utilizes the Alaska Online Public Notice System. Current
regulations are housed on the RCA website and links to those
regulations are typically available. However, it's important
that links goes to the entire docket, not just the text. This is
because the accompanying written orders are much more detailed,
explain the reasoning for the regulations, and often contain
suggestions or questions the commission wants the public to
comment on.
He said the same concern rests with Section 6. While the
commission's rulemaking is typically procedural, the complex
concepts can't be condensed to a brief description. Doing so
would be a disservice to the people and potentially misleading.
Currently the orders explain the problem the proposed regulation
is intended to solve in layman's terms.
MR. GOERING suggested that what the commission does is already
very transparent for the public and the requirements in sections
5-6 would be something of a step backwards in terms of keeping
the public informed and giving information about the
commission's rulemaking process.
SENATOR WIELECHOWSKI asked what his concerns were having this
bill apply to a quasi-judicial board.
MR. GOERING said there's particular concern with Section 2 that
allows the governor to return regulations because this could
jeopardize the independent function of the RCA. Sometimes there
is tension between the state and parties that appear before the
RCA and on occasion the state appears before the RCA on pipeline
and utility matters, so exposing the RCA to any kind of
political influence by inserting the governor into the process
would erode that independence and potentially hamper the work of
the commission.
CHAIR COGHILL asked the agencies that couldn't zero their fiscal
notes to get that information to his office before 1:30 this
afternoon because his intention was for the bill to have no
fiscal impact.
SENATOR WIELECHOWSKI asked Mr. Goering what other quasi-judicial
boards there are and whether they've had an opportunity to
comment on the bill. He also asked if the bill requires the
State Assessment Review Board to submit their order to the
governor for review and if the governor could potentially
disapprove of a SAR decision.
CHAIR COGHILL asked Mr. Goering to address the question when the
committee returned.
10:33:16 AM
CHAIR COGHILL recessed the meeting until 1:30 p.m.
1:34:47 PM
CHAIR COGHILL reconvened the meeting. Present were Senators
Dyson, McGuire, Olson and Chair Coghill. Senator Wielechowski
arrived during introductory comments.
CHAIR COGHILL removed his objection and Version L was adopted.
He opened the discussion on the fiscal notes.
1:36:39 PM
ARNOLD LIEBELT, Policy Analyst, Office of Management and Budget
(OMB), Office of the Governor, Juneau, Alaska, explained that
changes were anticipated when HB 140 was introduced, and OMB
decided to prepare one indeterminate statewide OMB fiscal note
that summarized the impact in the analysis section. For Version
L the Department of Natural Resources (DNR), the Department of
Environmental Conservation (DEC), and the Department of
Commerce, Community and Economic Development (DCCED) submitted
more detailed fiscal notes that total $700,000.
SENATOR WIELECHOWSKI asked if there was any response from the
Department of Health and Social Services (DHSS) and the
Department of Labor and Workforce Development (DOLWD).
MR. LIEBELT said DHSS believes they will be impacted but they
couldn't quantify the amount so they would have submitted an
indeterminate fiscal note. DOLWD opted to track the expenses and
perhaps come back for an increment in the future. Other
departments may have to make similar requests.
CHAIR COGHILL said his intention was to learn if there were real
impacts.
MR. LIEBELT responded that all the departments indicated that
additional resources would be necessary.
1:40:38 PM
DANIEL T. SEAMOUNT, Geologist Commissioner, Alaska Oil and Gas
Conservation Commission (AOGCC), stated that AOGCC is satisfied
with the current version of HB 140 and has no objection to
sections 5-6.
1:41:22 PM
LYNN KENT, Deputy Commissioner, Department of Environmental
Conservation (DEC), Juneau, Alaska, discussed the DEC fiscal
note. With regard to Section 3, she said the term "good faith"
is in the eye of the beholder, but there is certainly a cost to
the department to provide a credible cost estimate for
implementation of proposed regulations. Another phrase in
Section 3 talks about basing the estimate on "information
available to the department" but that isn't defined and there
doesn't appear to be any legislative intent on the record as to
what that means. DEC notices about 15 proposed regulation
packages each year and the monetary impact varies. Some could
result in a cost savings to those that DEC regulates.
She explained that DEC's fiscal note includes contractual funds
that would be used to help the divisions sort out what actions
have to be taken by state agencies, the public, or
municipalities in complying with the proposed regulations. The
fiscal note does include one economist because the department
doesn't have that type of expertise. The work necessary to
estimate the costs would vary with the regulation, but it's not
possible to do a credible job of giving a cost estimate without
additional resources.
MS. KENT said the fiscal note doesn't include any cost
associated with Section 5 because it will take just a little
administrative time to make sure that the proposed regulations
are posted on the Alaska Online Public Notice System.
CHAIR COGHILL asked if the bill would impose a cost when a
regulation has to be written based on a change in federal law.
MS. KENT explained that when the federal government proposes a
regulation the cost estimate is the aggregate nationwide. It
would be difficult for DEC to separate the costs that would
apply in Alaska and the cost difference to do something in
Alaska versus the Lower 48.
CHAIR COGHILL asked if it's fair to say that some cost estimates
are based on public comment on proposed regulations.
MS. KENT said DEC often receives cost feedback from those who
will be regulated, but that comes after the public notice is
issued. This bill requires a cost estimate before the
regulations are put out for public comment.
1:49:25 PM
NORMAN ROKEBURG, Commissioner, Regulatory Commission of Alaska,
referenced a comment about the RCA's impact on utility rates and
pointed out that the commission operates under statutory
guidelines to find just and reasonable rates, but tries to keep
affordability in mind.
SENATOR DYSON said he, too, wanted to clarify that RCA's work
isn't solely limited to keeping rates down. The commission is
charged with regulating utilities to ensure the delivery of
safe, reliable, and economic energy, which includes dealing with
proposed rate increases that are not directly related to the
immediate operation of the plants. He discussed his disagreement
with the RCA during the Cook Inlet oil and gas production crisis
and his opinion that the commission's policy not to let fuel
prices drift up to reflect the market was very foolish. He also
mentioned his disagreement when he approached the RCA about
allowing the upper Cook Inlet electric utilities to work on
getting an alternative fuel supply and having the authority to
charge that off against the rate base. He concluded his comments
stressing that just looking out for utility rates to the
consumer has worked against guaranteeing a secure fuel supply
and a reliable transmission system.
CHAIR COGHILL noted that the analysis section of the DNR fiscal
note specifically discussed a "good faith estimate." He asked if
this record needed to clarify the intent of that term.
1:55:05 PM
WENDY WOOLF, Petroleum Land Manager, Division of Oil and Gas,
Department of Natural Resources, Anchorage, Alaska, stated that
it would help DNR if the committee would clarify what it expects
in terms of a good faith effort. She agreed with the deputy
commissioner of DEC who requested clarity on the type of
information available to state agencies.
CHAIR COGHILL asked Mr. Liebelt if he had additional comments.
MR. LIEBELT said he believes that the testimony from DEC is
reflective of all the departments. It's Section 3 that triggers
the fiscal impacts.
CHAIR COGHILL asked the sponsor to comment on Section 3 (d).
1:56:05 PM
REPRESENTATIVE REINBOLD said that Section 3 and Section 7 are
the meat of the bill and that's why she questioned potentially
exempting the AOGCC and RCA. Her decided preference is to have
them comply with sections 5-6. After discussing the quasi-
judicial question with legislative legal, she feels that may no
longer be an issue. When she introduced the bill, the goal and
guiding question was what did she want government to look like
when she was no longer a public official. The answer is
affordable utilities, less government subsidies, affordable
energy to Alaskans, and a responsible government that has checks
and balances.
She said the intent of Section 3 is to ensure that agencies
don't promulgate regulations without looking at the impacts on
citizens, businesses, municipalities and other government
agencies. An agency currently only has to look at their cost,
whereas the bill requires an agency to look at the cost in the
aggregate for other state agencies, private persons, and
municipalities.
REPRESENTATIVE REINBOLD discussed Administrative Order 266,
which was issued in 8/2013. It establishes regulatory efficiency
guidelines for state agencies. She read the following excerpts
from Administrative Order 266:
· Minimize the cost, time, and burden to the affected
public of complying with State regulations and
encouraging State agencies to work with all
stakeholders, to meet the objectives of Alaska
Statutes;
· Ensure that State regulations are consistent with
Alaska Statutes and limited to carrying out the
statutory purpose;
· Share ideas with members of the affected public to
develop the proposed regulations through publicly
noticed workshops or hearings, calls for written
suggestions to improve the process, meetings with
advisory boards to the State agency, or other similar
means consistent with legal requirements;
· Verify costs of implementation to the State agency and
the affected public to ensure that the least costly
alternatives are considered or enabled consistent with
legal requirements;
In this Order, "affected public" includes
1. Small and other businesses subject to regulation
or conducting regulated activity;
2. State government;
3. Local governments;
4. Nonprofit organizations; and
5. Individuals.
Consistent with law and available appropriations, each
affected State agency shall use existing personnel and
monetary resources to comply with this Order.
REPRESENTATIVE REINBOLD said that in light of the forgoing, the
fiscal notes were a surprise.
She directed attention to an article in the Alaska Journal of
Commerce by Tim Bradner to explain why she wants assurance that
all state agencies will promulgate regulations that will benefit
the state in general. A critical part of that is for agencies to
identify whether their orders come from statute, the
legislature, or the federal government. The hearing on April
[15] showed that DNR was responding to the federal government
when it requested well log data from private entities.
2:03:08 PM
CHAIR COGHILL asked if she wanted to supplement the record with
regard to what constitutes a good faith effort to estimate.
REPRESENTATIVE REINBOLD said it's self-explanatory; the idea is
that they'll try. Several indemnity clauses were included in the
bill to protect the state in every way possible.
CHAIR COGHILL recapped that agencies are asked to give a reason
for the proposed action, the initial cost, and estimated annual
costs based on individual, municipal, and state actions. He
described that as fair.
REPRESENTATIVE REINBOLD said it mirrors Administrative Order
266.
2:04:54 PM
SENATOR WIELECHOWSKI expressed bewilderment and suggested that
the chair had whacked the hornet's nest, because the bill was
non-controversial in the other body. When people he respects in
AOGCC and RCA express concern, it causes him concern. He noted
the number of commissions that are quasi-judicial and that he
didn't know how the bill would impact them.
REPRESENTATIVE REINBOLD offered the following closing comments:
"The highest level of prosperity occurs when there is a free
market economy and limited government regulations. A system of
checks and balances should be adopted to prevent the abuse of
power by the different branches of government. And the beliefs
must be understood and perpetuated by every people who desire
peace, prosperity, and freedom." HB 140 helps with transparency
and accountability of government to the people.
CHAIR COGHILL offered supporting comments and solicited a
motion.
2:08:35 PM
SENATOR MCGUIRE moved to report CS for HB 140, Version L, from
committee with individual recommendations and attached fiscal
note(s).
CHAIR COGHILL announced that without objection, SCS CSHB
140(JUD) moved from the Senate Judiciary Standing Committee.