Legislature(2017 - 2018)CAPITOL 106

04/18/2017 05:15 PM House ENERGY

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05:17:16 PM Start
05:17:47 PM HB206
06:33:00 PM Adjourn
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                    ALASKA STATE LEGISLATURE                                                                                  
               HOUSE SPECIAL COMMITTEE ON ENERGY                                                                              
                         April 18, 2017                                                                                         
                           5:17 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Representative Adam Wool, Chair                                                                                                 
Representative Ivy Spohnholz, Vice Chair                                                                                        
Representative Matt Claman                                                                                                      
Representative Dean Westlake                                                                                                    
Representative DeLena Johnson                                                                                                   
Representative Jennifer Johnston                                                                                                
Representative George Rauscher                                                                                                  
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
HOUSE BILL NO. 206                                                                                                              
"An Act relating to an exemption for low-voltage projects from                                                                  
contractor requirements; and relating to an exemption from                                                                      
electrical administrator requirements."                                                                                         
     - HEARD & HELD                                                                                                             
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: HB 206                                                                                                                  
SHORT TITLE: EXEMPTION: CONTRACTORS, ELECTRICAL ADMIN.                                                                          
SPONSOR(s): REPRESENTATIVE(s) TALERICO                                                                                          
03/31/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
03/31/17       (H)       ENE, L&C                                                                                               
04/11/17       (H)       ENE AT 10:15 AM CAPITOL 17                                                                             
04/11/17       (H)       -- MEETING CANCELED --                                                                                 
04/18/17       (H)       ENE AT 5:15 PM CAPITOL 106                                                                             
WITNESS REGISTER                                                                                                              
REPRESENTATIVE DAVE TALERICO                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented HB 206 as prime sponsor.                                                                       
ELIJAH VERHAGEN, Staff                                                                                                          
Representative Dave Talerico                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Provided an overview  of HB 206 on behalf of                                                             
the bill sponsor, Representative Talerico.                                                                                      
SARA CHAMBERS, Deputy Director                                                                                                  
Division of Corporations, Business, and Professional Licensing                                                                  
Department of Commerce, Community & Economic Development (DCCED)                                                                
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   During  the hearing  of  HB 206,  provided                                                             
testimony representing  the Department  of Commerce,  Community &                                                               
Economic Development.                                                                                                           
DEBORAH KELLY, Director                                                                                                         
Division of Labor Standards & Safety                                                                                            
Department of Labor & Workforce Development (DOLWD)                                                                             
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   During  the hearing  of  HB 206,  provided                                                             
testimony  representing  the  Department  of  Labor  &  Workforce                                                               
TOM BRADY                                                                                                                       
Wasilla, Alaska                                                                                                                 
POSITION  STATEMENT:   During  the  hearing  of HB  206,  offered                                                             
comments regarding Sec. 2 of the legislation.                                                                                   
JOE ASHCRAFT                                                                                                                    
Ketchikan, Alaska                                                                                                               
POSITION STATEMENT:   During the hearing of HB  206, testified as                                                             
to his experience.                                                                                                              
WILL JOHNSON                                                                                                                    
Alaska Satellite Internet                                                                                                       
Fairbanks, Alaska                                                                                                               
POSITION  STATEMENT:   During  the  hearing  of HB  206,  offered                                                             
CRAIG MAPES                                                                                                                     
Tenakee Springs, Alaska                                                                                                         
POSITION  STATEMENT:   During  the  hearing  of HB  206,  offered                                                             
BRIAN ASHTON                                                                                                                    
Wrangell, Alaska                                                                                                                
POSITION  STATEMENT:   During  the  hearing  of HB  206,  offered                                                             
support for the legislation.                                                                                                    
WALTER ROBINSON                                                                                                                 
International Brotherhood of Electrical Workers 1547                                                                            
Nenana, Alaska                                                                                                                  
POSITION STATEMENT:   During the hearing of HB  206, testified in                                                             
ACTION NARRATIVE                                                                                                              
5:17:16 PM                                                                                                                    
CHAIR  ADAM WOOL  called the  House Special  Committee on  Energy                                                             
meeting to  order at 5:17  p.m.  Representatives  Wool, Johnston,                                                               
Johnson, Westlake,  Rauscher, Spohnholz, and Claman  were present                                                               
at the call to order.                                                                                                           
        HB 206-EXEMPTION: CONTRACTORS, ELECTRICAL ADMIN.                                                                    
5:17:47 PM                                                                                                                    
CHAIR WOOL  announced that  the only order  of business  would be                                                               
HOUSE BILL  NO. 206, "An  Act relating  to an exemption  for low-                                                               
voltage projects  from contractor  requirements; and  relating to                                                               
an exemption from electrical administrator requirements."                                                                       
5:18:18 PM                                                                                                                    
REPRESENTATIVE   DAVE   TALERICO,   Alaska   State   Legislature,                                                               
described  that new  satellite internet  technology may  provided                                                               
new  potentials  to Alaska's  rural  schools  and villages.    In                                                               
December 2016, the "Gen 5"  satellite was launched over Texas and                                                               
two of  the spot beams  on Gen 5 are  pointed toward Alaska.   It                                                               
appears  that,  at  some  point   in  time,  Alaska  may  receive                                                               
satellite  internet into  Alaska's remote  locations at  about 25                                                               
megabits per second  wherein, currently, some rural  areas are at                                                               
five and six  megabits.  The intent  of the bill is  to make sure                                                               
there are not a lot  of restrictions on the satellite installers,                                                               
"in particularly, if something crossed  over where it looked like                                                               
maybe  it  --   it  covered  these  people  that   would  do  the                                                               
installations   or  people   that  could   maintain  them.     In                                                               
particularly in  our rural communities  to see if there  would be                                                               
issues  with  them  getting  hooked  up or  them  being  able  to                                                               
maintain those."                                                                                                                
REPRESENTATIVE TALERICO  advised there  are two  regulations that                                                               
make   installing  the   internet   satellites  reasonably   cost                                                               
prohibitive, especially in the rural  areas.  He pointed out that                                                               
"originally  HB  206  seeks to  exempt"  the  satellite  internet                                                               
installers who perform that work from  the cost of paying for and                                                               
obtaining  the handyman  license.   Currently, he  explained, the                                                               
installers have a requirement to  be trained and certified by FCC                                                               
regulations  before   they  perform   an  installation   or  make                                                               
adjustments  to  the satellite,  and  the  bill language  exempts                                                               
satellite  installers  from  paying   and  having  an  electrical                                                               
administrator  oversee their  installations.   These are  all low                                                               
voltage projects  that do  not involve  any household  current or                                                               
high  voltage, he  explained, and  the only  thing they  actually                                                               
involve is  the plugging in of  an appliance into a  wall outlet.                                                               
It is not  electrical work, per se, that  a certified electrician                                                               
would be performing, he described.                                                                                              
5:22:09 PM                                                                                                                    
REPRESENTATIVE  TALERICO noted  that people  have concerns  as to                                                               
whether  the legislation  was  "going outside  of  the realm  and                                                               
everything."    He   explained  that  he  is   working  with  the                                                               
Department  of Labor  & Workforce  Development  (DOLWD), and  the                                                               
Department of Commerce, Community  & Economic Development (DCCED)                                                               
as to "what  can we really do here" because  the departments have                                                               
concerns  that if  this bill  is not  worded correctly,  it would                                                               
exempt people  from doing  things they should  not be  doing such                                                               
as,  climbing up  poles and  getting close  to high  power wires.                                                               
There was  also the  question of  the "handyman  license provides                                                               
for coverage  for liability,  they have a  low amount  of bonding                                                               
that they get."  He pointed  out that handymen perform "all kinds                                                               
of things" but  if they drilled a hole in  someone's home and hit                                                               
a waterpipe or an electrical line,  there would be a way to cover                                                               
the  damage.    He  said  he  is  crafting  language  with  those                                                               
departments'  suggestions to  narrow  the focus  and make  people                                                               
more comfortable  with the language  moving forward.   Alaska, he                                                               
noted, is behind the curve  when technology hits and advancing to                                                               
satellite technology would  move Alaska closer to the  curve.  He                                                               
advised that  education and students'  ability to  stay connected                                                               
is  his priority  intent, stressing  the importance  of continued                                                               
attention  on the  issues.   He  related that  the House  Special                                                               
Committee on Energy  was probably all in  agreement that distance                                                               
delivery education is desperately  needed out there and commented                                                               
that  within the  House Education  Standing  Committee there  was                                                               
much discussion  about equalizing  Alaska's education  and giving                                                               
the  same  opportunities  to  people   in  remote  areas  as  are                                                               
available in  some of  the urban  centers.  He  said his  take is                                                               
that the urban  centers "would be more than happy  to do distance                                                               
delivery education if the technology was in place."                                                                             
5:25:33 PM                                                                                                                    
CHAIR WOOL pointed  out that this bill is a  work in progress and                                                               
that  he did  not  want to  hammer  on a  bunch  of details  that                                                               
possibly would not be included in  the final product.  He related                                                               
that a high-level overview of the bill would be appreciated.                                                                    
5:25:58 PM                                                                                                                    
ELIJAH  VERHAGEN,  Staff,  Representative Dave  Talerico,  Alaska                                                               
State Legislature,  advised that  HB 206  has two  exemptions, as                                                               
follows: [Section 1, Sec. 08.18.161(8)]  page 2, line 11, has the                                                               
"re-added exemption  that used to be  in there all the  way until                                                               
2014," and  the wording was  change, as  follows: "work on  a low                                                               
voltage  project" wherein  previously  this was  an exemption  of                                                               
"under  $10,000 for  all work  --  all construction  work."   The                                                               
intent  of this  bill is  the tremendous  opportunity to  deliver                                                               
broadband to rural areas and  schools, approximately 19 volts for                                                               
the cables.  The sponsor  specifically included the language "low                                                               
voltage projects under one or  more contracts where the aggregate                                                               
price or the  total price is $10,000 or less,"  he explained, and                                                               
an amendment  is being crafted  to shrink the $10,000  limit down                                                               
to roughly $2,000.  Wherein,  he advised, if something went wrong                                                               
the consumer would be protected and  it would be on a small scale                                                               
under $2,000.   However, he commented, the  majority of satellite                                                               
installations are approximately $500, and  in small rural areas a                                                               
service provider  would train local  individuals and get  them up                                                               
to FCC regulations, and they  would be certified before providing                                                               
satellite installation because  they do not want to  "mess up the                                                               
entire  satellite."    In  the   event  that  trained  individual                                                               
performed "a lousy job" on  one customer's project, word of mouth                                                               
would spread,  and the  individual would no  longer be  hired, he                                                               
5:22:31 PM                                                                                                                    
MR. VERHAGEN  referred to HB  206, [Sec. 2,  AS 08.40.190(b)(12)]                                                               
page 4, line 12, and advised  that the second exemption refers to                                                               
the list  of exemptions from requiring  electrical administrators                                                               
oversight of  a project,  "[(12)] installation,  maintenance, and                                                               
repair    of    low   voltage    telecommunications,    broadband                                                               
transmission, and video  services."  He then referred  to page 3,                                                               
line  30, and  advised that  "(7) the  installation, maintenance,                                                               
and repair of fire alarms,  intrusion alarm, or other low voltage                                                               
signaling systems  of 48 volts"  is exempted.  He  explained that                                                               
the  sponsor  believes  that  "this   is  very  similar  to  that                                                               
exemption" because  it is  56 volts  or less  and defined  by the                                                               
National Electrical Code (NEC).   He explained that the installer                                                               
plugs  into   the  receptacle  they  will   eventually  plug  the                                                               
transmitter into,  and if the  outlet is wired  incorrectly, they                                                               
cease the project  and the customer would have to  get a licensed                                                               
electrician  to  fix  the  outlet  or fit  it  themselves.    The                                                               
oversight of an electrical administrator  is obsolete in the mind                                                               
of  the  sponsor because  the  installers  are dealing  with  low                                                               
voltage and, he reiterated, the  sponsor is crafting an amendment                                                               
to fix loopholes or unintended consequences.                                                                                    
5:32:00 PM                                                                                                                    
MR.  VERHAGEN, in  response to  Chair  Wool, agreed  that he  was                                                               
solely discussing satellite systems,  and the intent conveyed was                                                               
simply for broadband satellite receivers.                                                                                       
CHAIR  WOOL commented  that there  were  discussions about  other                                                               
types of  low voltage  systems, such as  fire alarms,  nurse call                                                               
systems, or  something similar, and  this was for  residential or                                                               
small commercial.                                                                                                               
REPRESENTATIVE  TALERICO agreed,  and he  said language  is being                                                               
crafted to bring  to the committee wherein it  is clearly defined                                                               
"where the system would be."                                                                                                    
5:32:51 PM                                                                                                                    
REPRESENTATIVE  JOHNSON  expressed   concern  that  hazardous  or                                                               
classified sites might be exempted.                                                                                             
MR.  VERHAGEN  replied  that the  concerns  are  not  necessarily                                                               
dealing with satellite broadband  internet but deal with "messing                                                               
with  the  power  grid."    In the  event  there  are  unintended                                                               
consequences in  this bill because  of that issue,  the amendment                                                               
would clarify it  and it may include the  word "wireless" because                                                               
this  broadband  transmission  satellite   is  wireless  and  not                                                               
plugged  into  the main  power  grid  that  is high  voltage  and                                                               
dangerous.   The  amendment, he  offered, will  reflect that  the                                                               
sponsor is not trying to open this  up to other areas, in that it                                                               
is primarily for wireless broadband internet.                                                                                   
5:34:11 PM                                                                                                                    
REPRESENTATIVE  CLAMAN asked  whether the  receivers today  would                                                               
receive a  satellite system if  they were available,  and whether                                                               
they  were small,  medium, or  large sized  receivers.   Also, he                                                               
noted that  he questions asking  anyone in rural or  urban Alaska                                                               
to install anything of any significance for less than $10,000.                                                                  
REPRESENTATIVE  TALERICO advised  that the  dish is  sometimes as                                                               
large as a 48-inch, but  typically, the dish is approximately 30-                                                               
inches and is plugged  into the house.  He said  he had been told                                                               
that the installations cost approximately $500.                                                                                 
CHAIR  WOOL opined  that sometimes  they are  subsidized "because                                                               
they know you  are going to have a service  you pay every month,"                                                               
similar to buying a printer for $40, except the ink is $50.                                                                     
5:36:41 PM                                                                                                                    
REPRESENTATIVE SPOHNHOLZ asked the cost of a handyman license.                                                                  
MR. VERHAGEN  opined that  in a two-year  period, a  person would                                                               
pay  $400 for  a  handyman license,  on  top of  a  $50 per  year                                                               
business license,  and bonding insurance  for up to $5,000.   The                                                               
installers will  be trained by  Hughes Net, Microcom,  Direct TV,                                                               
or  others, and  must  be  certified by  the  FCC  and receive  a                                                               
certification number before they are  allowed to " ever mess with                                                               
the satellites."  Another hurdle  for rural Alaskans is requiring                                                               
them to  pay an  additional $500 to  receive a  handyman license,                                                               
except  that  license entails  things  not  related to  satellite                                                               
installation whatsoever,  which is  the reason for  the exemption                                                               
for low voltage projects.                                                                                                       
5:38:20 PM                                                                                                                    
REPRESENTATIVE  SPOHNHOLZ asked  whether  there  would be  enough                                                               
work for  a person to  perform this service exclusively,  and not                                                               
just become the "handy people" in rural communities.                                                                            
REPRESENTATIVE  TALERICO  responded  that the  rural  economy  is                                                               
different  than what  he is  accustomed and  believes this  is an                                                               
"additional  thing"   someone  would   do  together   with  their                                                               
subsistence  lifestyle.    He  offered  that  subsequent  to  the                                                               
installation there would  be service on the system,  and the work                                                               
evolving from  this legislation  would be  more on  the part-time                                                               
5:39:49 PM                                                                                                                    
REPRESENTATIVE  SPOHNHOLZ surmised  that Representative  Talerico                                                               
was crafting  an amendment  to narrow the  focus more  clearly to                                                               
solely exempt  the satellite installers  as opposed to  a broader                                                               
REPRESENTATIVE TALERICO answered that  the concern was that there                                                               
would be  unlicensed and unbonded  linemen crawling up  on poles.                                                               
That is  not the intention and,  he described, this is  more like                                                               
working on separate standalone systems  bringing the 19-volt wire                                                               
in, and not being part of an electrical grid.                                                                                   
5:41:23 PM                                                                                                                    
REPRESENTATIVE SPOHNHOLZ  asked whether  the installers  would be                                                               
able to help schools obtain broadband access as well.                                                                           
REPRESENTATIVE TALERICO replied that  as the language is narrowed                                                               
down,  a lot  of  it will  depend upon  the  actual system  "they                                                               
choose to install."                                                                                                             
Typically,  he  said,  in  the  event the  school  wants  to  "do                                                               
something large"  it would probably be  accomplished via contract                                                               
and  take more  than  one person  to handle  the  equipment.   He                                                               
commented  that not  necessarily  every student  in his  district                                                               
attends the  public school  because they  are in  locations where                                                               
public school  is not available.   His hope, he offered,  is that                                                               
at some point those students would  be able to stay connected and                                                               
have that interaction with the rest  of the state as far as their                                                               
MR. VERHAGEN added  that some of the providers  have advised that                                                               
they  will develop  an "education  or school  package" for  rural                                                               
schools and offer a special deal.                                                                                               
5:44:52 PM                                                                                                                    
SARA  CHAMBERS,   Deputy  Director,  Division   of  Corporations,                                                               
Business,  and  Professional  Licensing  (DCBPL),  Department  of                                                               
Commerce,   Community  &   Economic   Development  (DCCED),   was                                                               
available for testimony and questions.                                                                                          
5:44:57 PM                                                                                                                    
DEBORAH KELLY,  Director, Division  of Labor Standards  & Safety,                                                               
Department  of   Labor  &  Workforce  Development   (DOLWD),  was                                                               
available for testimony and questions.                                                                                          
5:45:06 PM                                                                                                                    
MS. CHAMBERS  related that she  is looking forward  to continuing                                                               
to work with  the sponsor and the committee to  move the language                                                               
toward the sponsor's  intent.  She related  that this legislation                                                               
falls  within the  Department of  Commerce, Community  & Economic                                                               
Development  (DCCED) statutes,  but  she works  closely with  the                                                               
DOLWD because it  has electrical and mechanical  expertise and it                                                               
also works on  enforcement with her department.   She referred to                                                               
HB 206, Section 1, and  advised it is the construction contractor                                                               
exemption  which would  exempt the  stated work  from having  any                                                               
construction  contractor license,  and she  offered concern  from                                                               
the consumer  protection standpoint of exemption  from licensure.                                                               
She   explained   that   for   general   contractors,   specialty                                                               
contractors,  and  handymen,  there  are  no  rigorous  education                                                               
requirements.   The  focus is  on having  a registration  of that                                                               
license type  and making sure  the person is properly  bonded and                                                               
insured if  they have employees.   The rigors are not  large, she                                                               
described,  but to  pay the  fee for  a general  contractor or  a                                                               
handyman is $235  every two years, the bonding for  a handyman is                                                               
$5,000 wherein  the fee is two  percent to four percent,  and the                                                               
general contractor  bond is $20,000.   She  offered that it  is a                                                               
couple of  hundred dollars per  year to  be a handyman  when "you                                                               
are  all  in,"  and  any  handyman  installer  who  performs  any                                                               
handyman  work under  $10,000 regardless  of what  it is,  if its                                                               
repair  effecting  the  structure  of  a  home,  for  example,  a                                                               
contractor license would be required.                                                                                           
5:48:13 PM                                                                                                                    
CHAIR WOOL surmised that the  $10,000 threshold is for a handyman                                                               
license and  above that amount  a general contractors  license is                                                               
required and  commented that a  handyman license  is contractor's                                                               
MS. CHAMBERS  offered that  it is a  contractor license  for that                                                               
smaller  dollar  threshold,  anything  above  that  amount  would                                                               
require a general,  a specialty, or a general  with a residential                                                               
endorsement license.                                                                                                            
CHAIR WOOL  surmised that  up until 2014,  the $10,000  and below                                                               
figure  was exempt  from  any  licensure, and  this  is a  recent                                                               
MS.  CHAMBERS agreed,  and  she said  the  legislature made  that                                                               
change in 2014.                                                                                                                 
CHAIR WOOL  offered a  scenario of  a carpenter  performing small                                                               
jobs living in rural Alaska,  and 2014 rolls along requiring that                                                               
for  this  type  of  work  under  $10,000,  a  license  would  be                                                               
required.   He asked whether  her division was tracking  how many                                                               
people were getting these licenses.                                                                                             
MS.   CHAMBERS  answered   absolutely  and   said  there   was  a                                                               
misunderstanding that  any work  under $10,000  was exempt.   She                                                               
explained  that if  it was  covered  in a  license, for  example,                                                               
carpentry work  requires a specialty contractor  license, so even                                                               
if someone was  hanging crown molding in a home,  they would need                                                               
a specialty contractor license under state law.                                                                                 
5:50:00 PM                                                                                                                    
REPRESENTATIVE  RAUSCHER  asked  that Ms.  Chambers  explain  the                                                               
confines of a subcontractor or specialty license.                                                                               
MS. CHAMBERS explained that the  specialty contractor license can                                                               
take up to three specialties, and  a long list of specialties has                                                               
been developed  over the years.   These are special  jobs wherein                                                               
someone  might have  two or  three specialties,  such as  hanging                                                               
drywall, but not  contracting to build a home.   Beyond the three                                                               
specialties,  she  explained,  a  person  would  need  a  general                                                               
contractor license,  and noted that specialty  contractors cannot                                                               
bid for  their own projects,  a general contractor would  have to                                                               
5:51:27 PM                                                                                                                    
CHAIR  WOOL noted  that a  handyman does  not have  a performance                                                               
test of knowledge, wherein they  basically just sign up, obtain a                                                               
bond,  and they  are qualified.   In  the event  the person  is a                                                               
specialty  contractor, asked  whether there  is a  performance or                                                               
knowledge test.                                                                                                                 
MS.  CHAMBERS replied  that  the  only areas  of  testing in  the                                                               
construction contractor  field is if residences  are being built.                                                               
The electrical,  mechanical, and administrator license  types are                                                               
cousins  to  the  construction contractor  license  type  and  do                                                               
require testing  with a far more  extensive education experience,                                                               
such as journeyman or certificate of  fitness.  She said that for                                                               
a construction  contractor, "if you  want to build a  home that's                                                               
the only testing.   You can build all the  buildings you want and                                                               
not have any performance measures."                                                                                             
5:52:25 PM                                                                                                                    
REPRESENTATIVE RAUSCHER  asked whether  she meant  building homes                                                               
as a business for other people.                                                                                                 
MS. CHAMBERS  answered that  Representative Rauscher  was exactly                                                               
correct, there  are quite a  few exemptions and one  exemption is                                                               
if the person is building their own home.                                                                                       
MS. CHAMBERS  offered that was  the extent of her  testimony with                                                               
the  final  remark that  this  not  a performance-based  type  of                                                               
license, but  the bonding does  provide an element  of protection                                                               
for  consumers   to  have   recourse  through   the  department's                                                               
investigative  procedures should  something go  awry outside  the                                                               
realm of licensure.   She added that that was  one of the reasons                                                               
the  department believes  contractor licensure  is important  for                                                               
satellite installers as it currently stands in the bill.                                                                        
5:53:50 PM                                                                                                                    
MS. KELLY mentioned that there  are EA exemptions related to this                                                               
type  of  work already,  such  as,  manufacture, maintenance  and                                                               
repair of  electrical equipment,  and electric work  under $5,000                                                               
in communities  of under 500  people or remote communities.   She                                                               
explained that the  EA is a public safety measure  in order to be                                                               
certain  the person  supervising  the work  understands the  code                                                               
because  there  are  real   dangers  associated  with  electrical                                                               
installations,   including    those   low    voltage   electrical                                                               
installations  because  they do  not  exist  in  a vacuum.    She                                                               
related  that the  manner  in  which this  bill  is written  will                                                               
affect  a broader  range  of  work than  intended  and creates  a                                                               
substantial  public  safety  concern,   not  just  an  electrical                                                               
concern  but a  structural concern  as well.   The  department is                                                               
working with the sponsor to  address these public safety concerns                                                               
because  the bill  allows people  working on  or around  the high                                                               
voltage power  grid to then  bring an electrical  connection from                                                               
that grid into a home or business, she stressed.                                                                                
5:55:49 PM                                                                                                                    
CHAIR WOOL surmised  that if it is a population  under 500 people                                                               
or a  remote community and the  cost does not exceed  $5,000, "so                                                               
what the bill  sponsor said earlier was say, under  $2,000 and in                                                               
rural  communities  only" would  be  exempt  from the  electrical                                                               
administrator (EA) based on the current exemptions.                                                                             
MS. KELLY responded  that she was unsure whether  the sponsor was                                                               
talking about making  a specific rural exemption for  the EA, but                                                               
the $2,000 requirement was related to  HB 206 Section 1, and Sec.                                                               
2 does not have an associated dollar amount.                                                                                    
5:56:43 PM                                                                                                                    
MS. CHAMBERS referred  to Sec. 2, and advised it  would modify AS                                                               
08.40.190(b), which is the rural  exemption stating the specifics                                                               
that would exempt rural communities  from needing that electrical                                                               
[Public testimony was opened.]                                                                                                  
5:57:35 PM                                                                                                                    
TOM BRADY, Microcon,  referred to HB 206, Sec. 2,  and advised it                                                               
deals  with the  installation of  satellite broadband,  satellite                                                               
video, and other  broadband services.  He  called the committee's                                                               
attention to AS  08.40.005, and said it gives the  purpose of the                                                               
electrical  safety   program  in   Alaska.    This   statute,  he                                                               
explained, is  supposed to  protect the  safety of  people (audio                                                               
difficulties) from the danger  of improperly installed electrical                                                               
wiring  and  equipment  by providing  procedures  to  assure  the                                                               
public  that  that  persons  responsible  for  making  electrical                                                               
installations   are   qualified,   and   secondly   that   (audio                                                               
difficulties) persons are qualified.   He pointed to AS 08.40.200                                                               
and  said  that electrical  wiring  means  and includes:  wiring,                                                               
fixtures, conduits,  appliances, devices, equipment,  overhead or                                                               
underground  wiring systems,  or  other  equipment in  connection                                                               
with  the  general  distribution  or  utilization  of  electrical                                                               
energy.   Satellite equipment cabling,  he said, is not  used for                                                               
the  general distribution  and use  of electrical  energy, so  it                                                               
would   appear  that   the  satellite   broadband  industry   and                                                               
television  industry  did  not  follow  Alaska's  statutes.    He                                                               
explained that  this came about  approximately 18 months  ago the                                                               
DOLWD and DCCED advised "us  of potential violations" of Alaska's                                                               
contracting  law,  12  AAC 21.260,  dealing  with  communications                                                               
contractors.   In  2008,  the  DOLWD in  consult  with the  DCCED                                                               
redefined  the  satellite television  industry  as  being of  the                                                               
audio-visual   industry,  and   he   related  that   that  is   a                                                               
redefinition that the audio-visual  industry did not recognize or                                                               
understand.   This bill clarifies that  the satellite television,                                                               
broadband  industry and  the wireless  broadband industry,  would                                                               
not fall  under AS  08.40.005 and its  subsequent sections.   The                                                               
satellite television  broadband industry  to a certain  extent is                                                               
self-regulating  in   that  the  major  service   providers  have                                                               
specific  training  and  certification  programs  for  its  field                                                               
workforce of  employees, contractors, and  independent retailers,                                                               
he explained.   In addition,  he advised, the  National Satellite                                                               
Broadcasting    and     Communications    Association    conducts                                                               
certification  programs  on  behalf   of  service  providers  for                                                               
residential and  commercial installations, which  is supplemented                                                               
by  online training  with Direct  TV, Dish  Network, Myoset,  and                                                               
Hughes Networks.   He related that  they are not trying  to avoid                                                               
regulations (audio  difficulties) contractor license rule  in the                                                               
State of  Alaska, they are  saying that any  regulatory structure                                                               
must   have  a   clear   public  purpose   and  be   appropriate,                                                               
enforceable,   and  reviewed   on   a   recurring  basis   (audio                                                               
difficulties) small  business.   The specific requirement  for an                                                               
electrical   administrator    (EA)   in   inside    and   outside                                                               
communications is (audio difficulties)  small business and (audio                                                               
difficulties) do  the job involved.   He said he would  address a                                                               
comment from DOLWD  regarding extending the energy  grid into the                                                               
home, "We don't do that, we're  not allowed to do that, we're not                                                               
qualified to  do that.   We  work only  with the  distribution of                                                               
video  and  broadband  services   and  the  associated  equipment                                                               
provided by the service provider."                                                                                              
6:01:54 PM                                                                                                                    
CHAIR  WOOL  asked  the  voltage   of  satellite,  and  also  the                                                               
MR. BRADY  responded that currently  the highest voltage  used in                                                               
satellite television and  satellite broadband is 29  DC volts and                                                               
approximately 1.5 amps.                                                                                                         
6:02:47 PM                                                                                                                    
JOE ASHCRAFT  offered that he  was speaking from Yakutat  and had                                                               
installed  approximately 60  Hughes  Nets and  they were  working                                                               
well.   He related there  was misinformation  regarding [schools]                                                               
and  said that  unless Hughes  Net takes  the Fair  Access Policy                                                               
(FAB) - the cap  limits on these off, it would  not be viable for                                                               
a school  because it works so  fast.  Right now,  he said, "we're                                                               
talking 40  megs down or so  with Hughes Net trying  to match the                                                               
broadband definition from the FCC of  25 megs going forward."  He                                                               
explained that  a school  of 10-20  students may  use up  the 550                                                               
gigs available for  the month within a few days  and then it goes                                                               
back down to a slow speed - slower  than the KU Band that most of                                                               
the  schools have  currently which  are "un-fab."   For  the most                                                               
part, the  system is low voltage  and not much danger,  except in                                                               
areas   with  lightening,   such  as   around  Pelican,   because                                                               
lightening and  other access current  can build in some  of those                                                               
places.   He  opined, that  for  some of  these people,  trained,                                                               
untrained, or do  their own, somebody needs to  oversee and train                                                               
them well.   He then related an anecdote about  a woman in Hoonah                                                               
with many dishes on her roof  that eventually it ruined her roof.                                                               
He does think there should be  regulation, but it stands that the                                                               
person hiring  subcontractors would  monitor what they  do, audit                                                               
the installations,  and make  sure the consumer  was not  put out                                                               
money-wise for  poor installations.   The  Hughes Net  dishes are                                                               
.98, a  little less than  a meter, there  will be some  with 1.2-                                                               
meters  used on  the  edges of  these  signals to  try  to get  a                                                               
signal.   He related  that last  year the  state required  him to                                                               
install a 2.4-meter dish at a  construction site, it took quite a                                                               
while to  get that dish to  the construction site and  at a large                                                               
expense.   The  1.2-meter  dish  had worked  fine  for the  three                                                               
months prior to  the installation of the 2.4-meter  dish, and the                                                               
new  dish worked  approximately a  percentage point  better.   He                                                               
suggested that the industry sit  down with the representatives to                                                               
brainstorm  because technology  is  moving fast,  wherein in  2-3                                                               
years "One Web"  will be available for students  and everyone all                                                               
over  the  world and  will  dispel  any  need for  an  electrical                                                               
6:07:25 PM                                                                                                                    
MR. ASHCRAFT,  in response to Chair  Wool, answered that he  is a                                                               
dealer  from  Ketchikan  and   has  performed  installations  for                                                               
approximately 30 years.                                                                                                         
CHAIR  WOOL  asked  whether  $2,000   would  cover  most  of  the                                                               
MR.  ASHCRAFT said  that  it  depends upon  the  dish wherein  an                                                               
install of an "I Direct System"  with a 2.4-meter dish is usually                                                               
around  $1,200, and  GCI does  the same  thing for  approximately                                                               
$2,500.  He  then explained the various charges  and related that                                                               
$2,000 is a good figure.                                                                                                        
6:09:15 PM                                                                                                                    
WILL   JOHNSON,   Alaska   Satellite  Internet,   explained   his                                                               
background  with  Hughes  Net,  operating the  flight  school  in                                                               
Bethel and training local pilots.                                                                                               
CHAIR WOOL asked Mr. Johnson to speak to the bill at hand.                                                                      
MR. JOHNSON  advised that Alaska Satellite  Internet now partners                                                               
with  over  400  installers  in rural  areas  with  "more  active                                                               
customers than anyone  in the nation."  He  assured the committee                                                               
that the  exemptions for electrical administrator  are unworkable                                                               
and "you will  absolutely kill the deal to  require an electrical                                                               
administrator,"  and   also  will  kill   it  with   bonding  and                                                               
licensing.   He explained  that the  application alone  will turn                                                               
installers  in  the  bush  away,  and  he  is  trying  to  remove                                                               
obstacles  that  prevent  local   people  from  installing  these                                                               
systems.  As  to the installations, he said, over  the years they                                                               
have  not  had  a  problem   with  ruining  houses  or  roofs  or                                                               
electrocuting people because none of  this has ever happened.  He                                                               
pointed out  that home schooling  is a big  deal in the  bush and                                                               
they do not have internet, but  the kids at school have internet.                                                               
He said, "If we continue on  the course we're going, I'm going to                                                               
have to shut down my business, tell all those installers good-                                                                  
bye -  there'll be no more  work for them."   His installers have                                                               
advised him that  they will not do the licensing  and bonding due                                                               
to the expense, especially because  they only install possibly 3-                                                               
10  systems per  year, and  Mr. Johnson  wants them  available to                                                               
service  the systems.   He  said that  the other  model is  where                                                               
installers  from "the  big  city"  are sent  out  at an  enormous                                                               
expense and install "a whole bunch  of them at once," except if a                                                               
system breaks down no one will  come out from the city to service                                                               
that system.  He stressed that he likes Native installers.                                                                      
6:15:00 PM                                                                                                                    
MR. JOHNSON,  in response to  Chair Wool, reiterated that  he has                                                               
400 installers  in rural  Alaska and  has installed  thousands of                                                               
systems.   He  then mentioned  that  he only  wants one  business                                                               
model because  he can't  have six  different business  models for                                                               
each region.                                                                                                                    
CHAIR WOOL  asked whether Mr.  Johnson had  said that for  all of                                                               
his installers, if  they had to get a  handyman license, register                                                               
with the  state, and get bonded,  that it would be  a hurdle they                                                               
would not cross.                                                                                                                
MR.  JOHNSON answered  that it  is a  "bridge too  far," for  the                                                               
average rural person because it  economically does not make sense                                                               
with the  limited money  they have, the  limited money  they will                                                               
receive  from  the   installations,  and  it  would   also  be  a                                                               
"nightmare for  him to  comply with,  and it's  -- it's  just not                                                               
going happen."  He pointed  out that anyone who feels differently                                                               
is not familiar with the conditions in the villages.                                                                            
MR. JOHNSON, in response to Chair  Wool, advised that he does not                                                               
know a single person with a  handyman's license and all this does                                                               
is make people break the law.                                                                                                   
6:16:44 PM                                                                                                                    
CRAIG  MAPES  surmised that  the  issue  is  the need  for  local                                                               
installers due to  the difficulty of installers  from Juneau only                                                               
being  available  for a  short  period  of  time.   The  lack  of                                                               
installers caused him  to suggest to a distributor  that he would                                                               
become  an  installer,  and  while  on his  way  to  becoming  an                                                               
installer,  realized there  is a  stumbling (audio  difficulties)                                                               
license,  but  easier  than  a  lot of  people  out  there.    He                                                               
explained   that  he   is  a   retired  school   teacher,  taught                                                               
construction for  decades, built  many houses  in Alaska,  and is                                                               
certainly qualified and able to  get a handyman license.  Except,                                                               
he said,  he does not want  a handyman license to  just install a                                                               
system in  his home and  a few neighbors,  nor can he  afford the                                                               
bond to  perform this simple  task.  As  far as safety,  he noted                                                               
that the first  thing he learned in his  national curriculum with                                                               
Hughes  Net  training  was (audio  difficulties)  plug  a  simple                                                               
voltage tester  into an outlet  in the home  and if there  is any                                                               
indication  that  the  power  is  not  (audio  difficulties)  the                                                               
installation stops at  that point and the homeowner has  to get a                                                               
licensed  person to  repair it.   The  system is  essentially the                                                               
same as  plugging in a  toaster wherein the installer  mounts the                                                               
dish under  stringent standards,  runs the wire  to the  home and                                                               
plugs into a  modem to an AC  outlet that has nothing  to do with                                                               
high voltage  or electrical wiring.   He reiterated that  this is                                                               
about having local people available  to perform this service, and                                                               
it  would be  an  economic and  realistic burden  for  him to  go                                                               
through the  hoops and  expense to  become a  licensed contractor                                                               
and  buy  the  bond.    He related  the  importance  of  crafting                                                               
regulations   so   local   people   in   villages   can   receive                                                               
communication services,  and while  he certainly  understands and                                                               
supports the  reasons for  electrical safety  codes, it  would be                                                               
best for  local installers to  install the satellite  systems and                                                               
help many people "because it is kind of a big deal."                                                                            
6:22:15 PM                                                                                                                    
CHAIR  WOOL  asked  whether  he   was  currently  undergoing  the                                                               
training from Hughes Net, or had completed the training.                                                                        
MR. MAPES responded  that he completed the online  portion and is                                                               
about to complete his hands-on training to become an installer.                                                                 
CHAIR WOOL asked whether he has to pay for the training.                                                                        
MR. JOHNSON  advised that  there is basically  no charge  for the                                                               
training, but  in his case, he  has to get himself  from where he                                                               
lives to the training site at his own expense.                                                                                  
CHAIR WOOL asked whether he  knows anyone in Tenakee Springs with                                                               
a handyman license.                                                                                                             
MR. MAPES  answered that he  does not  know whether anyone  has a                                                               
handyman license is or is a licensed contractor.                                                                                
6:23:51 PM                                                                                                                    
BRIAN  ASHTON advised  he  is  a dealer  for  Hughes Net,  helped                                                               
introduce Hughes Net into Alaska  approximately 10 years ago, and                                                               
he supports this  legislation.  He described that he  is a strong                                                               
advocate of  living in  rural Alaska being  raised in  Hoonah and                                                               
living in Wrangell, and the  importance for the rural communities                                                               
to have trained local people  to install and actually service the                                                               
systems.    He  then  demonstrated the  actual  product  for  the                                                               
committee and how  it works.  The cost of  the equipment is $600,                                                               
and if  the system  is not installed  properly it  could actually                                                               
stress the  satellite and  make it  work harder.   Until  now, he                                                               
said,  they have  been operating  with a  15-year old  satellite,                                                               
Generation 2 technology,  providing up to 2  megabits per second,                                                               
and with the  new satellite there is a guarantee  of a minimum of                                                               
25  megabits  per  second.   Alaska  basically  "missed  out  on"                                                               
Generation 3 and 4 satellites because  they were in the East with                                                               
the bigger  markets.  The goal  is a good program  training rural                                                               
individual how  to install  and provide  service to  this system,                                                               
not only is  it needed for reliability and  quickness of service,                                                               
but also to preserve technology  jobs in these rural communities.                                                               
When it comes  to protecting property, it entails a  hole to push                                                               
"this through the wall" and applying  caulking to seal it up, and                                                               
he has not  had one complaint in  30 years, he said.   Mr. Ashton                                                               
referred to  the comment that the  current plans do not  work for                                                               
Alaska's  school systems  and  advised that  he  is working  with                                                               
Hughes Net  and its parent  company to  put together a  plan that                                                               
will work for rural schools.                                                                                                    
6:30:46 PM                                                                                                                    
WALTER ROBINSON, International  Brotherhood of Electrical Workers                                                               
1547,  advise he  is  a 17-year  electrician  working around  the                                                               
state in  low and  medium voltage  systems, licensed  through the                                                               
State  of  Alaska as  an  electrical  journeyman thereby  passing                                                               
required tests pertaining  to the National Electric  Code, and is                                                               
in opposition  to HB  206.  These  standards, he  explained, have                                                               
been set in place because it  does not matter the voltage rate on                                                               
a system, but rather what the  system does, and he sees no reason                                                               
to lower  the standards required  by the  state to have  the work                                                               
performed  by  a  company  that   does  not  hold  an  electrical                                                               
administrator's  license.   He offered  that this  will open  the                                                               
door  for  other  low  voltage   systems  that  are  life  safety                                                               
(indisc.)  without an  electrical administrative  license.   This                                                               
bill "targets products under $10,000  and rural Alaska projects,"                                                               
and  he pointed  out that  Alaska's  rural schools  are the  last                                                               
place  to cut  corners, and  that electrical  systems need  to be                                                               
installed in  a safe and  professional manner.   The only  way to                                                               
ensure this  happens is  by using  qualified licensed  people and                                                               
the   work   overseen  by   a   person   holding  an   electrical                                                               
administrator's  license.   He related  that rather  than putting                                                               
Alaskans   at  risk,   there  should   be   a  strengthening   of                                                               
certification  requirements.    His   problem  is  not  with  the                                                               
satellite  disk installation,  he pointed  out, it  is that  this                                                               
bill opens  up all low  voltage systems and  there needs to  be a                                                               
way to narrow down the scope of this bill.                                                                                      
6:32:30 PM                                                                                                                    
CHAIR WOOL  commented that this  bill is  a work in  progress and                                                               
the bill will be before the committee in the future.                                                                            
[HB 206 was held over.]                                                                                                         
6:33:00 PM                                                                                                                    
There being no  further business before the  committee, the House                                                               
Special Committee on Energy meeting was adjourned at 6:33 p.m.                                                                  

Document Name Date/Time Subjects
HB 206 - Legislation - Ver D 3.31.17.pdf HENE 4/18/2017 5:15:00 PM
HB 206
HB 206 - Sectional Analysis 3.31.17.pdf HENE 4/18/2017 5:15:00 PM
HB 206
HB 206 - Sponsor Statement 3.31.17.pdf HENE 4/18/2017 5:15:00 PM
HB 206
HB206 - Fiscal Note - DCCED-CBPL-04-07-17.pdf HENE 4/18/2017 5:15:00 PM
HB 206
HB 206 - Letters of Support.PDF HENE 4/18/2017 5:15:00 PM
HB 206
HB 206 Amendment D.1 - 4.18.17.pdf HENE 4/18/2017 5:15:00 PM
HB 206
Amendment D.3 - HB 206.pdf HENE 4/18/2017 5:15:00 PM
HB 206