Legislature(1993 - 1994)
03/30/1994 09:07 AM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
CHAIRMAN LEMAN brings up SB 365 (GOVERNOR'S OMNIBUS BILL) as the next order of business before the Senate State Affairs Committee. The chairman calls the first witness. Number 576 NANCY SLAGLE, Director, Division of Budget Review, Office of Management & Budget (OMB) states SB 365 would increase fees and reduce expenses wherever practicable in state government. A sectional analysis which briefly explains each of the sections was provided to the committee... TAPE 94-21, SIDE B MS SLAGLE says she can either walk the committee through the sectional analysis or answer specific questions. Number 581 SENATOR TAYLOR wants to know why non-mutual collateral estoppel against the state is abolished, but is ok against all other parties. CHAIRMAN LEMAN asks that collateral estoppel be defined. MS. SLAGLE responds it has to do with a decision that has been made in one district, and whether that decision would apply to a similar case in another district. Ms. Slagle states it is her understanding that the Department of Law believes disallowing non- mutual collateral estoppel against the state could be an extensive cost-saving measure. CHAIRMAN LEMAN asks if there is anyone from the Department of Law present who could speak to the question. Number 557 MARGOT KNUTH, Assistant Attorney General, Criminal Division, Department of Law states the Civil Division in the Department of Law is involved in this issue as well, and it would probably be good for the committee to hear from someone in that division as well. MS. KNUTH replies, in answer to Senator Taylor's question, the state is probably the one party involved in the greatest number of lawsuits throughout the State of Alaska. The state loses a number of cases, and the way the state decides whether or not to appeal a case is if it can live with the decision in that particular case. There are all sorts of adverse decisions against the state which the state does not feel it is important to appeal. It may be a small case, or perhaps the state even feels that the right result for that individual was reached in that decision. Probably under appeal, it would be concluded that the legal analysis by the court was unsound. But if the state needs to appeal every adverse decision, even in the smallest case, because the state would not be able to live with that decision being applied to a different, perhaps multi-million dollar case, would cause the state's litigation to skyrocket. The state would need a lot more attorneys, both in the civil side and the criminal side. The State of Alaska is uniquely situated; there is no other party in the State of Alaska sued as often as the state. Number 538 CHAIRMAN LEMAN asks Ms. Knuth about the language in SB 365 overriding the decision of the court in the State v. UCIDA (United Cook Inlet Drift Association) and what would be the effect of that. MS. KNUTH responds she is vaguely familiar with that case. It was a supreme court decision that said the court was now going to start applying collateral estoppel against the State of Alaska. She does not recall the specifics of the case, but could have someone from the Civil Division available for the committee. Number 532 SENATOR TAYLOR states collateral estoppel is not a new doctrine, but merely a new application by the supreme court of collateral estoppel. He states there must be a lot of commonality between two cases for collateral estoppel to be applied to the present case. Number 519 MS. KNUTH replies that is exactly the problem that was created by UCIDA. Number 512 CHAIRMAN LEMAN asks what section 14, extending temporary vehicle permits from 30 days to 60 days, would accomplish. Number 505 JUANITA HENSLEY, Chief, Driver Services, Division of Motor Vehicles, Department of Public Safety says section 14 would allow the department to issue 60 day temporary vehicle licenses. The reason for this is many times people aren't able to get title to the car within 30 days. This keeps that person from having to come back in to get a second 30 day permit when the first expires. Number 490 SENATOR TAYLOR asks about the section that would repeal the statute relating to proof of motor vehicle liability insurance in the case of an accident; why would we want to repeal that statute. Number 484 SENATOR DONLEY notes that sections 18 through 26 deal with motor vehicle liability insurance. Number 480 MS. HENSLEY responds section 18 increases the amount of damage from 500$ to 1500$. The information the department has received from the insurance industry and the Division of Insurance indicates the average claim is about 1600$. Police departments are not able to investigate minor property damage accidents due to budgetary constraints. Section 18 would simply increase the dollar amount required to be reported. Number 465 SENATOR TAYLOR comments what this section would do is raise the ceiling of when an accident would have to be reported. Number 458 MS. HENSLEY states people driving without insurance would have their driver's licenses suspended if they were in an accident with a damage total of over 1500$, instead of a limit of 500$. Number 450 SENATOR TAYLOR says part of what the state is trying to pick up with mandatory reporting of accidents with damage of 500$ or over is people driving with suspended or revoked driver's licenses. CHAIRMAN LEMAN comments that simply scratching the finish on a car can cost 1500$. MS. HENSLEY says that is very true, and sometimes breaking a tail light on a car can be 1500$. Number 429 SENATOR DONLEY states that at the time mandatory auto insurance legislation was passed, there was a decision made not to require proof of insurance up front. One of the selling points for that was to raise registration fees to pay for a program where people would have to show proof of insurance if they were in an accident. It was a "check" to make sure people were getting insurance. If we now weaken the "check" we have, it removes one of the arguments for not having proof up front. Number 417 CHAIRMAN LEMAN asks Ms. Hensley how many more accidents would slip through the system if the state changes from mandatory reporting for accidents from 500$ damage to 1500$ damage. Number 414 MS. HENSLEY replies she really does not have that information. Number 410 SENATOR TAYLOR says he would like to get back to public safety concerns. He is concerned with section 43 because it would repeal that portion relating to proof of motor vehicle liability insurance in the case of an accident. Number 405 MS. HENSLEY states that is not correct. The repealer section in AS 28.22.041 would allow a person to come back within a period of time and submit proof that they purchased insurance after the fact. Ms. Hensley says she would have to read the statute to explain exactly what it would do, but it does not repeal the mandatory insurance law at all. It just takes out one paragraph which is a loophole. SENATOR DONLEY says he did not understand that explanation at all. SENATOR TAYLOR says he was confused too. Number 395 MS. SLAGLE responds that section 23 and 24 of SB 365 deal with the sections concerning proof of motor vehicle liability insurance. Those sections are not repealed from statute. SENATOR DONLEY asks why AS 28.10.108 (b) should be deleted. MS. HENSLEY replies AS 28.10.108 (b) deals with allowing commercial vehicles to have a rotating registration period, as do private vehicles. CHAIRMAN LEMAN notes that the committee is operating with time constraints today, and asks that members perhaps review their concerns about SB 365 between today and next Wednesday. Number 374 SENATOR TAYLOR says that he will just list his concerns for the department and they can then be taken up Wednesday. He has a significant concern with section 12, which would change the method of notification for cancellation, suspension, or revocation of driver's licenses from certified mail to first class mail. He thinks police officers should go out and personally serve the notices and cut the license plates off the damn car at the same time. By not sending the letter certified mail, the state cannot even prove in court that the notice was received. SENATOR TAYLOR's second concern is all the additional fees that the Department of Public Safety is asking for. He wants to know how the department is currently handling SR22's. Who is responsible for maintaining those records? Number 334 MS. HENSLEY replies the Department of Public Safety is basically not going to change any of the operation of how SR22's are handled, or how suspension of driver's licenses for uninsured motorists are handled. The only thing changing, is the department will not be issuing suspension notices for those individuals involved in accidents where the damages are between 500$ and 1,500$. MS. HENSLEY states the mandatory insurance law has worked. Before the law, the uninsured motorist rate was about 21%. In 1985, that rate went down to 7.7%. It has slowly risen over the years, and is now at about 11.9%. The department has not been excluded from the budget cuts of the last several years, and has fewer employees today. One of the things the committee should be aware of is that the house budget caps have cut out the financial responsibility program entirely from the department's budget. If that budget goes through, the Department of Public Safety will not be suspending any driver's licenses for failure to prove financial responsibility. Number 311 SENATOR TAYLOR asks Ms. Hensley what happened to the revenue stream created in 1985 by the mandatory insurance laws. That revenue stream was intended to support those positions. MS. HENSLEY responds the Division of Motor Vehicles brings 29 million dollars per year to the general fund, while at the same time receiving a budget of 7.9 million dollars. That money goes to the general fund and is not coming back to DMV. SENATOR TAYLOR asks if Ms. Hensley knows why that money is not coming back to DMV. He asks, if we add all these new fees, won't they also go into the general fund? Senator Taylor says he is fascinated to hear that is what is happening to DPS's budget on the house side, and he will do what he can to correct that. Number 277 CHAIRMAN LEMAN asks personnel from DEC to be prepared to address the committee regarding the section of SB 365 that relates to them at Wednesday's hearing. The chairman announces that, in the interest of time, the committee will hold SB 365 until Wednesday's hearing.