Legislature(2003 - 2004)
04/10/2003 01:35 PM Senate L&C
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
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= bill was previously heard/scheduled
SB 128-COMMON CARRIER LIQUOR LICENSE
CHAIR CON BUNDE called the Senate Labor and Commerce Standing
Committee meeting to order at 1:35 p.m. and announced SB 128 to
be up for consideration.
MR. RICHARD SCHMITZ, staff to Senator Cowdery, sponsor,
explained that the purpose of SB 128 is to streamline some of
the permitting requirements in situations where a common carrier
(airplane or boat) also sells liquor as part of its function and
is, therefore, regulated. Alaska Airlines, for instance, has to
get a separate license for every airplane that it owns, because
it can't separate out which planes may or may not come to
Alaska. The purpose of the bill is to allow those carriers to
instead license a certain number of planes, probably 10, and pay
a fee for each plane beyond that. It also affects planes that
serve cruise ship passengers that go to McKinley Park from
Anchorage or Seward and it would allow trains that have bar cars
to get one license.
MR. IRVING BERTRAM, general counsel, Alaska Airlines, said that
licensure requires filling out a lot of paperwork and is a bit
of an administrative burden for Alaska Airlines and the
Alcoholic Beverage Control Board (ABC). Alaska Airlines hopes to
eliminate that process as its fleet continues to grow. Currently
it has 100 licenses and would like to simply pay a minor fee for
additional planes without having to go through the
administrative hassle and expense of posting and publishing.
They would also like to see their overall licensing fee be
reduced and pay the regular fee for the first 10 licenses and
$100 for each additional license.
MR. BERTRAM explained that the fee structures in other states
are significantly different from Alaska's. Arizona charges $275
and in California, Alaska Airlines pays a $400 fee and $12 per
aircraft for duplicate licenses. In Oregon it pays $203 and in
Washington has a $1,200 cost with $750 for the fee, plus $5 for
each aircraft. Alaska Airlines pays over $40,000 in Alaska,
which it feels is a little bit inequitable given the nature of
its business and what the state has to do in terms of regulation
for them as a licensee. While Alaska Airlines prefers the fee
structure of California and Oregon, it is satisfied with what's
in SB 128.
CHAIR BUNDE commented that many Alaskans would like to have
airfares between Alaskan cities priced similarly to airfares in
the Lower 48 as well.
MR. BERTRAM agreed that was a good point, but added that he
wished Alaska Airline's costs were the same, too.
CHAIR BUNDE asked if he would support the bill if it were
revenue neutral.
MR. BERTRAM replied yes.
MR. DOUG GRIFFIN, ABC Board, concurred with Mr. Bertram's
remarks and supported SB 128. He said this is an area where
state law has not kept up with modern times in terms of
logistics of aircraft. These fees could be acting as a deterrent
for other airlines to come into Alaska. The duplicate licensing
concept is used in other states.
CHAIR BUNDE asked if this would also apply to Era and Penn Air.
MR. GRIFFIN replied it would if they provide that service.
SENATOR STEVENS asked what the state does in terms of regulation
and whether inspections are involved.
MR. GRIFFIN replied the state does very little. The main concern
is safety and bad behavior caused by alcohol consumption.
SENATOR FRENCH asked if all airlines who do business in the
state, specifically those who are not based here, have Alaska
liquor licenses.
CHAIR BUNDE replied they do if they serve Anchorage and
Fairbanks, but for Anchorage and Seattle, no.
SENATOR SEEKINS moved to pass SB 128 from committee with
individual recommendations and its attached fiscal note.
The roll was called. SENATORS SEEKINS, FRENCH, STEVENS, DAVIS
and BUNDE voted yea and it passed from committee.
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