Legislature(1995 - 1996)

01/30/1996 10:40 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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                     HOUSE FINANCE COMMITTEE                                   
                        JANUARY 30, 1996                                       
                           10:40 A.M.                                          
                                                                               
  TAPE HFC 96 - 21, Side 1, #000 - end.                                        
  TAPE HFC 96 - 21, Side 2, #000 - end.                                        
  TAPE HFC 96 - 22, Side 1, #000 - end.                                        
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair  Mark Hanley  called  the  House Finance  Committee                 
  meeting to order at 10:40 A.M.                                               
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Hanley               Representative Martin                          
  Co-Chair Foster               Representative Mulder                          
  Representative Brown          Representative Navarre                         
  Representative Grussendorf    Representative Kohring                         
  Representative Kelly          Representative Therriault                      
                                                                               
  Representative Parnell was not present for the meeting.                      
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Mark Tumeo, (Testified via teleconference), Antarctica; Kate                 
  Wattum,  (Testified  via teleconference),  Fairbanks; Daniel                 
  Collison,  Board Member,  Southeast Alaska  Gay  and Lesbian                 
  Alliance,   Juneau;   Stephen   Jacquier,   (Testified   via                 
  teleconference), Self, Anchorage;  Lynn Stimler,  (Testified                 
  via  teleconference),   Executive  Director,American   Civil                 
  Liberties Union (ACLU), Anchorage; Tom Owens, (Testified via                 
  teleconference),   Attorney,   Representing   University  of                 
  Alaska, Anchorage; Mildred Boesser, Juneau  City and Borough                 
  Human  Rights  Commission,   Juneau;  Susan  Hargis,  Chair,                 
  Southeast Alaska Gay and Lesbian Alliance  (SEAGLA), Juneau;                 
  Marsha Buck, Parents,  Families and Friends of  Lesbians and                 
  Gays  (PFLAG),  Juneau;  Sara  Boesser,  Board  Member,  the                 
  Committee  for  Equality,  Juneau;  Pam LaBolle,  President,                 
  Alaska State Chamber of Commerce -Juneau.                                    
                                                                               
  SUMMARY                                                                      
                                                                               
  HB 226    An  Act  permitting  the  provision  of  different                 
            retirement and health benefits  to employees based                 
            on marital status.                                                 
                                                                               
            CS HB 226 (FIN) was reported out of Committee with                 
            a "do pass" recommendation and  with a fiscal note                 
            by the Department of Administration.                               
  HB226                                                                        
                                                                               
                                1                                              
                                                                               
                                                                               
  HOUSE BILL 226                                                               
                                                                               
       "An   Act  permitting   the   provision  of   different                 
       retirement and  health benefits to  employees based  on                 
       marital status."                                                        
                                                                               
  MARK  TUMEO,  ANTARCTICA,  (TESTIFIED  VIA  TELECONFERENCE),                 
  testified  on  HB   226  and   the  proposed  amendment   by                 
  Representative  Kelly.    He  stated  that providing  health                 
  benefits to the  domestic partner of  an employee would  not                 
  represent  a  threat  to  the  State's economy,  the  social                 
  fabric, marriage or society.   He noted that the  University                 
  of Alaska has  already instituted domestic  partner benefits                 
  without major administrative or economic  impact.  There has                 
  been less that a .5% increase to benefit costs.                              
                                                                               
  Mr. Tumeo agreed  that the bill was  "highly" controversial.                 
  It is a bill that deals with the definition of relationship;                 
  a bill which touches the core  of every Alaskan's concept of                 
  fair play and  morality.  He added,  the arguments presented                 
  to  support the bill  were emotional and  that those persons                 
  opposing the bill are at a distinct disadvantage.  Mr. Tumeo                 
  questioned  if   "emotional  moralism"  was   a  politically                 
  successful basis for legislation.  He felt that the proposed                 
  legislation would attempt to legislate in favor of one group                 
  of people--married  people--over another  group--non-married                 
  people.                                                                      
                                                                               
  Mr. Tumeo thought  that passage of the  legislation would be                 
  another example  of  the government  intruding  in  personal                 
  affairs.  He urged  Committee members to "kill" the  bill as                 
  he felt that it would gut the Human Rights Act in an attempt                 
  to enforce one type of family structure over another.  [Copy                 
  of testimony on file].                                                       
                                                                               
  Representative Brown asked  the current status of  the court                 
  suit.  Mr.  Tumeo explained that  it was pending before  the                 
  Supreme Court and that a decision would be issued in Spring,                 
  1996.                                                                        
                                                                               
  Representative   Martin  voiced   strong   support  of   the                 
  traditional family rights,  stating that the core  issue was                 
  being  degraded.    Mr.  Tumeo  explained  that  information                 
  resulting from the 1990 census indicates that less  than 40%                 
  of the children  in our country are  raised in a two  parent                 
  home where one  parent stays home.   He emphasized the  fact                 
  that there are many different family structures.                             
                                                                               
  Mr. Tumeo responded to a question regarding the court brief.                 
  He stated it was not the  legal argument which was supported                 
  or presented  by the  Supreme Court.   He  acknowledged that                 
  there should be a "tight" fence around who could qualify for                 
                                                                               
                                2                                              
                                                                               
                                                                               
  the  benefits.     Representative  Therriault  stated   that                 
  information needed clarification by the Human Rights Act.                    
                                                                               
  Mr. Tumeo  added, following  the Court's  decision, the  law                 
  will be eliminated or expanded reflecting the interpretation                 
  of that  decision.  He added,  it would be premature  to act                 
  before  the  Supreme   Court  decision,   entering  into   a                 
  possibility of amending a critical law.                                      
                                                                               
  Representative Therriault  voiced his concern that  no limit                 
  existed, pointing out when the Human Rights Act was enacted,                 
  it was not anticipated the need that this circumstance would                 
  exist.                                                                       
                                                                               
  Representative Kelly spoke  to the amendment adopted  by the                 
  House  HESS  Committee  as  proposed  by   Mr.  Tumeo.    He                 
  questioned isolating the concept of "domestic partnerships",                 
  suggesting that the criteria proposed  would allow anyone to                 
  buy into or out of the program.  Mr. Tumeo explained various                 
  approaches to  domestic partnerships  which  can be  legally                 
  binding.  He  added, as with  any benefit or condition  upon                 
  which a benefit is  given, the conditions can change.   Once                 
  the status changes,  the individual would be  responsible to                 
  report that.  He continued, there are plenty of stipulations                 
  to address the fraud concerns, and  that the University does                 
  have a qualification waiting period.  Mr. Tumeo acknowledged                 
  Representative   Kelly's   concern   agreeing    that   some                 
  relationships are not long lasting and pointing out that was                 
  true of marriage's also.                                                     
                                                                               
  Representative Kelly  disagreed.   He stated  that a  person                 
  could  get  into  and  out  of  domestic  partnerships  more                 
  quickly; a domestic partnership ends  when the partners stop                 
  living together.   Representative Kelly added that  the non-                 
  traditional relationship will leave behind broken marriages,                 
  broken  neighborhoods   and  broken  families.    Mr.  Tumeo                 
  countered that a  domestic partnership  does not threaten  a                 
  marriage.  Non-traditional relationships can be entered into                 
  and exited just as a marriage can.  Mr. Tumeo concluded that                 
  relationships of either  type should  not be of  legislative                 
  interest.                                                                    
                                                                               
  Representative Kelly elaborated that the changes made to the                 
  legislation  in the two  previous committee's could threaten                 
  partners  within  a  domestic partnership.    Representative                 
  Kelly explained the origin of the legislation, noting that a                 
  recent court decision  ordered the  University of Alaska  to                 
  extend  health insurance  coverage and benefits  to domestic                 
  partners.  HB 226 would address the decision by  reasserting                 
  the rights  of employers,  including the  State, to  exclude                 
  domestic  partners from  health  insurance benefits,  unless                 
  they choose otherwise.  He added, it was his intent  that HB
                                3                                              
                                                                               
                                                                               
  226 reduce the  uncertainty employers  now face in  planning                 
  group insurance programs.                                                    
                                                                               
  Representative  Kelly  added,  the   court  decision  leaves                 
  unclear who is, and who is not, entitled to family benefits.                 
  HB 226 would seek to close  the door on a possible onslaught                 
  of  domestic  partnerships created  just  to  gain benefits.                 
  Representative Kelly  urged the  Committee's support of  the                 
  original legislation or the House Finance Committee version.                 
                                                                               
                                                                               
  KATE  WATTUM,  (TESTIFIED  VIA  TELECONFERENCE),  FAIRBANKS,                 
  spoke against HB 226 which she felt would specifically write                 
  "discrimination" into law.  She emphasized that the proposed                 
  legislation is about "emotion" and "people", and that people                 
  will  be  hurt  with its  passage.    She  thought that  the                 
  extended benefits  program should  be issued  to all  family                 
  members who qualify.                                                         
                                                                               
  Representative  Martin   asked  if   Ms.  Wattum's   partner                 
  currently had a health package.   Ms. Wattum explained  that                 
  her partner  does currently  have  coverage and  that it  is                 
  supplemented with  her  own policy  through the  University.                 
  Representative Martin expounded his theories on the legality                 
  of  marriage  and the  rights which  come with  that choice.                 
  Representative Martin  added that  the State  should not  be                 
  required to pay  for equal rights in  domestic partnerships.                 
  Ms. Wattum remarked  that all she  was requesting was  equal                 
  access to  a benefit which  every other married  employee of                 
  the University has access to for their spouses and children.                 
                                                                               
                                                                               
  Representative Kelly pointed out that  if the court decision                 
  was held and  that domestic  partnerships were created,  Ms.                 
  Wattum would  be paid  more than  the single  person who  is                 
  employed at the same work place.  He emphasized that the act                 
  would create  a new  class of  people.  Discussion  followed                 
  between Ms.  Wattum and Representative Kelly  regarding this                 
  "new" class of people.                                                       
                                                                               
  DANIEL COLLISON,  BOARD MEMBERS,  SOUTHEAST  ALASKA GAY  AND                 
  LESBIAN ALLIANCE (SEAGLA),  JUNEAU, distributed a letter  to                 
  Committee  members from  Bob  Miller,  Director,  Office  of                 
  Public Affairs, University of Alaska.  [Attachment #1].  Mr.                 
  Collison spoke against HB 226 and/or  in support of the HESS                 
  version of the legislation.                                                  
                                                                               
  He pointed out that the University has received less than 1%                 
  increase in plan  enrollments.  Mr. Collison  referenced the                 
  letter  [Attachment  #1], clarifying  that  to date  only 44                 
  employees have  registered  their partners  in the  domestic                 
  health plan.  One third of these individuals are in same sex                 
                                                                               
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  relationships; additionally, nine children  were registered.                 
  He  observed that the  recognition of  domestic partnerships                 
  would not place an undue burden on the State.  Mr.  Collison                 
  urged the passage of HB 226 with the HESS amendment.                         
                                                                               
  Representative  Martin  reiterated his  concerns recognizing                 
  non-traditional families  and relationships.   Mr.  Collison                 
  reminded Representative  Martin that the question before the                 
  Committee was access  to the  benefits on economic  grounds.                 
  He stressed the  issue is the court has indicated that it is                 
  wrong to discriminate against domestic partnerships.                         
                                                                               
  (Tape Change, HFC 96-21, Side 2).                                            
                                                                               
  Mr. Collison  reiterated that  the Supreme  Court is  due to                 
  rule on that issue this spring.                                              
                                                                               
  Representative Therriault felt that the court decision  does                 
  not  address  the  main  concern  of  discrimination.    Mr.                 
  Collison interjected  that  the  court  decision  was  being                 
  decided  on  access to  benefits.   A  marriage relationship                 
  carries  with it  inter-financial  legal  obligations.    He                 
  pointed out that he could have a relationship with a man and                 
  have those  same responsibilities.   The court is  trying to                 
  clarify  that  there  can  exist   two  different  types  of                 
  contractual relationships; one entered  into by marriage and                 
  another one  entered  into  privately  by  two  individuals,                 
  recognized as a domestic partner relationship.  The court is                 
  not  creating  different  classes  of  people,  but  instead                 
  interpreting why certain people are being denied benefits.                   
                                                                               
  STEPHEN    JACQUIER,    (TESTIFIED    VIA   TELECONFERENCE),                 
  REPRESENTING SELF, ANCHORAGE, spoke strongly against passage                 
  of the proposed legislation.                                                 
                                                                               
  Representative Grussendorf  advised that  the law in  Alaska                 
  currently  is  based on  the  decision of  Judge  Green, who                 
  indicated the action  attempted by the University  of Alaska                 
  was discriminatory in nature.  He reminded Committee members                 
  that the  case was  currently  before the  Supreme Court  on                 
  appeal with a  decision soon to  be made.     Representative                 
  Grussendorf  summarized  that   the  HESS  version  of   the                 
  legislation does support the opinion of Judge Green.                         
                                                                               
  LYNN  STIMLER,  (TESTIFIED  VIA  TELECONFERENCE),  EXECUTIVE                 
  DIRECTOR, AMERICAN CIVIL LIBERTIES  UNION (ACLU), ANCHORAGE,                 
  explained that the issue of HB 226 should not exist while it                 
  is pending before the  Supreme Court.  She pointed  out that                 
  the ACLU is opposed to the original  HB 226.  She noted that                 
  it is outside  the spirit and  plain language of the  Alaska                 
  Constitution and the Alaska Human Rights Act.                                
                                                                               
                                                                               
                                5                                              
                                                                               
                                                                               
  Ms.  Stimler addressed  the economics,  noting  that private                 
  employers extend these  type of benefits because  it is good                 
  business  practice.    Employers know  and  understand  that                 
  today's  work force  is comprised of  many people  living in                 
  many different types of situations.  The Alaska Constitution                 
  is more broadly  protective of the individuals  civil rights                 
  and liberties than the U.S. Constitution is.                                 
                                                                               
  Ms. Stimler reiterated  that the ACLU believes the  State is                 
  "out of place"  debating these concerns  while the issue  is                 
  before the Supreme Court.  To adopt language amending law to                 
  specifically allow discrimination  because of marital status                 
  is against the spirit and plain language of the Alaska Human                 
  Rights Act.  She urged the Legislature not to be involved in                 
  such a discriminating policy.                                                
                                                                               
  TOM   OWENS,   (TESTIFIED  VIA   TELECONFERENCE),  ATTORNEY,                 
  REPRESENTING THE UNIVERSITY OF ALASKA - ANCHORAGE, commented                 
  that the  provisions of  A.S. 18:80  only applies to  public                 
  employers.  The  State anti-  discrimination laws have  been                 
  made  inapplicable to qualify  for benefits or  plans in the                 
  private sector.   He  added, it  is important  to note  that                 
  Judge Green's decision  was not based on  any constitutional                 
  analysis.                                                                    
                                                                               
  Mr. Owens added, the purpose of the proposed amendment, A.S.                 
  18:80, was to confirm the statutory scheme which has existed                 
  in the State  of Alaska for many years.   This scheme allows                 
  public  employers   to  discriminate  in  the  provision  of                 
  benefits on the basis of marital status  or parental status.                 
  He continued, the purpose of  the proposed legislation would                 
  confirm  that  the Legislature  never  intended to  have the                 
  provisions of A.S.  18:80 prohibit  the provision of  health                 
  care benefits on the bases of marital or parental status.                    
                                                                               
  Representative Grussendorf  asked if  the bill would  affect                 
  the private sector.  Mr. Owens  replied that Judge Green did                 
  not get to the constitutional issues because she didn't need                 
  to.  She  based her  decision upon reading  the language  of                 
  A.S. 18:80, adding  that the courts  make their decision  on                 
  the lowest  level of  consideration.   The applicability  of                 
  A.S.  18:80  to the  private sector  would  be based  on the                 
  federal court ruling in 1974.   The State antidiscrimination                 
  laws do  not apply  to the  provisions of  benefits under  a                 
  qualified plan in the private sector.                                        
                                                                               
  Representative Martin pointed out the amenities available to                 
  University  teachers,  health   care,  tuition  and  benefit                 
  waivers.  He reminded Committee members that the Legislature                 
  continues to be responsible for the University budget.                       
                                                                               
  Representative  Therriault  questioned how  Judge  Green got                 
                                                                               
                                6                                              
                                                                               
                                                                               
  beyond statute areas which mandate the differentiation.  Mr.                 
  Owens responded that Judge Green made her decision through a                 
  written  opinion.  His  comments on  her decision  are based                 
  upon a reading of that  decision.  Judge Green did  not make                 
  any comments  regarding the other statutory  provisions that                 
  either mandate  or permit  discrimination  based on  marital                 
  status.  After Judge Green made her decision, the University                 
  made a motion to reconsider, pointing out to Judge Green the                 
  existence of the other statutes  which level the Legislative                 
  intent  to  file  or  require  discrimination  provision  of                 
  benefits based  on marital status.   Judge Green  refused to                 
  consider  those  arguments  and   thus  continued  with  her                 
  original decision.                                                           
                                                                               
  MILDRED  BOESSER,  JUNEAU  CITY   &  BOROUGH  HUMAN   RIGHTS                 
  COMMISSION, JUNEAU, provided Committee members with  a Human                 
  Rights Commission, City and Borough of Juneau (CBJ) Position                 
  Paper on  HB 226.  [Attachment #2].   She noted that the CBJ                 
  Committee opposes  HB 226  because it  discriminates against                 
  committed  partners  to  the  detriment  of  Alaska  and  in                 
  violation of the Constitution.                                               
                                                                               
  Mrs. Boesser understood that the legislation resulted from a                 
  fear to undermine  the traditional  family unit, whereas  in                 
  reality, the concept of "domestic partners" is an attempt to                 
  enlarge  the concept  of family  to include  non-traditional                 
  groupings which exist  everywhere already.   She recommended                 
  that this  group is in  need of  the family support  and the                 
  benefits that traditional families enjoy.                                    
                                                                               
  Mrs.  Boesser acknowledged  that we all  live in  a changing                 
  society  and  that  many different  types  of  families have                 
  emerged.    She  encouraged supporting  people  that  are in                 
  loving,  stable relationships,  even when that  picture does                 
  not include our own view of family.                                          
                                                                               
  Co-Chair Hanley  asked if  CBJ allows  domestic partners  to                 
  share in benefits.  Mrs. Boesser replied they do not at this                 
  time.                                                                        
                                                                               
  Representative Kelly  pointed  out  that  the  Alaska  Human                 
  Rights Commission did not support Judge Greens decision.                     
                                                                               
  SUSAN  HARGIS,  CHAIR,  SOUTHEAST  ALASKA  GAY  AND  LESBIAN                 
  ALLIANCE (SEAGLA), JUNEAU,  testified against  HB 226.   She                 
  pointed  out  that  the  legislation  was initiated  on  the                 
  premise  of  "financial  burden"   as  initially  stated  by                 
  Representative  Kelly  in  the House  HESS  Committee.   She                 
  reminded Committee members  of evidence  that the  financial                 
  cost would be  less than .5%.   Ms. Hargis added that  it is                 
  important that more  children be covered and  have access to                 
  health care.                                                                 
                                                                               
                                7                                              
                                                                               
                                                                               
  In  response to Representative  Kelly's comment,  Ms. Hargis                 
  agreed that fraud  does exist  within any system,  although,                 
  stated that  all employees  deserve  the same  rights.   Ms.                 
  Hargis urged  Committee members to either "kill" the bill or                 
  pass the version adopted by the House HESS Committee.                        
                                                                               
  Representative Therriault warned that the end result of this                 
  argument could  be that  only employees are  covered by  the                 
  insurance  benefits.    Ms. Hargis  agreed  that  this could                 
  happen.                                                                      
                                                                               
  Representative Kelly noted  that the issue  is not how  many                 
  same sex people versus how many opposite sex people sign up.                 
  To date 45 people  have signed up.  Aetna  Insurance Company                 
  has stated the cost.   Representative Kelly noted  that cost                 
  would be  equivalent to the  cost of a  university professor                 
  for  a  one year  salary.   Aetna  does assume  a percentage                 
  increase each  year.   Representative Kelly  emphasized that                 
  these costs will  grow, and that  they are a moving  target.                 
  Ms.  Hargis replied that  Aetna has also  clarified that the                 
  amount  does   increase,  although,  the  increase  for  any                 
  organization participating has  not exceeded  the 3% cap  in                 
  the past several years.                                                      
                                                                               
  (Tape Change, HFC 96-22, Side 1).                                            
                                                                               
  Ms.  Hargis concluded that the  State would be better served                 
  by providing more people access to health care.                              
                                                                               
  MARSHA BUCK, PARENTS,  FAMILIES AND FRIENDS OF  LESBIANS AND                 
  GAYS (PFLAG), JUNEAU, provided Committee members with a copy                 
  of a letter from Dixie Hood, Co-Chair, PFLAG, indicating the                 
  position  of  that  group.   [Copy  on  file].   The  letter                 
  requested that the  bill die  in Committee, suggesting  that                 
  the matter be addressed by the employer and the employee.                    
                                                                               
  Ms. Buck noted  that she  agreed with the  testimony of  Ms.                 
  Hood  and  encouraged the  bill to  die  in Committee.   She                 
  stated  that  as  a  parent  of  a daughter  in  a  domestic                 
  relationship, the  bill as  written was  divisive and  deals                 
  with matters of personal freedom.  Representative Therriault                 
  commented that the people of Alaska are the employers of the                 
  University of  Alaska employees,  of which  he represents  a                 
  specific group of those  shareholders, who think differently                 
  than Ms. Buck.                                                               
                                                                               
  SARA  BOESSER,  BOARD  MEMBER, STATEWIDE  ORGANIZATION,  THE                 
  COMMITTEE FOR EQUALITY,  JUNEAU, spoke  in opposition to  HB
  226.   She  advised  that the  Committee  for Equality  does                 
  support the HESS version of the legislation and that version                 
  matches the court action.  [Copy of testimony on file].                      
                                                                               
                                8                                              
                                                                               
                                                                               
  Ms. Boesser recommended the House Finance Committee send the                 
  bill to a subcommittee to  research the legal and  financial                 
  implications  of  any  changes that  would  cross  the court                 
  proceedings now in progress.   She continued, in the  extent                 
  that  Representative   Kelly  opposes  equal   benefits  for                 
  domestic partnerships on religious beliefs  he may hold, the                 
  Committee should remember that  while the U.S.  Constitution                 
  does  protect  people from  discrimination  on the  basis of                 
  religion,  that  protection   also  includes  freedom   from                 
  religion.                                                                    
                                                                               
  In conclusion, Ms. Boesser, summarized that CS 226 (JUD)  as                 
  passed was a good bill, but  unnecessary, due to the pending                 
  court action at this time.                                                   
                                                                               
  Representative  Kelly  addressed   the  legislative   ethics                 
  concern,  pointing out that  the bill does  not ban domestic                 
  partnerships.  The proposed legislation  only states that if                 
  you  choose as  an  employer or  employee  not to  recognize                 
  domestic partnerships to give benefits, you can choose to do                 
  so.  He added that these  concerns are defined in the Alaska                 
  Statutes and are determined  on that level; not the  Supreme                 
  Court.   Ms. Boesser  disagreed, stating  that the  bill was                 
  specifically written in order to discriminate against people                 
  in domestic relationships.                                                   
                                                                               
  PAM LABOLLE, PRESIDENT,  ALASKA STATE  CHAMBER OF  COMMERCE,                 
  JUNEAU, advised that  the Alaska  State Chamber of  Commerce                 
  represents  nearly 700  employers statewide  which employees                 
  7,000 employees.   The Alaska State Chamber  of Commerce has                 
  no position on the traditional  or non-traditional aspect of                 
  the legislation.  She advised  that the Chamber's concern is                 
  that without  the proposed  legislation, there  would be  an                 
  expansion of  the benefit  pool which  would increase  State                 
  spending.    Ms.  LaBolle  commented  that  the  number  one                 
  priority  of  the State  Chamber  was a  reduction  of State                 
  spending.                                                                    
                                                                               
  Ms. LaBolle continued, private  employers are in competition                 
  with  the  State.   The  State  pays a  much  better benefit                 
  package than a private employer can afford and thus, private                 
  industry loses good employees to the  State work force.  She                 
  suggested  that  to  level  the  playing  field  would  give                 
  coverage for the actual employee and the additional coverage                 
  would be paid for individually for each dependent.                           
                                                                               
  Representative  Navarre  argued   that  the  benefits  which                 
  already exist cause the competition  with private employers,                 
  not  those   being   discussed   for   the   non-traditional                 
  households.    He  stated  that  the  competition  would  be                 
  minimally  impacted  by the  application of  the bill.   Ms.                 
                                                                               
                                9                                              
                                                                               
                                                                               
  LaBolle  emphasized  that all  the  facts are  not currently                 
  available.   She thought anything  that was done  to enhance                 
  the  State's  benefits  would  place  the State  in  greater                 
  competition with the private sector.  Representative Navarre                 
  responded that the intent  was to extend benefits to  people                 
  already employed and would not be used as a recruitment tool                 
  by the State.                                                                
                                                                               
  Representative  Mulder MOVED  that CS  HB  226 (FIN)  be the                 
  version  before   the  Committee.     Representative   Brown                 
  OBJECTED.                                                                    
                                                                               
  Representative Navarre  asked for  further clarification  of                 
  "domestic partnership".   Co-Chair Hanley  noted that CS  HB
  226 (FIN)  would return the law  to the place  it was before                 
  Judge Greens  decision.   Statutorily,  the  decision  would                 
  close the questions  which Judge Green had,  clarifying that                 
  discrimination is allowed  in that particular instance.   He                 
  added that the  strict definition of  marriage would be  the                 
  dividing line.                                                               
                                                                               
  Representative  Navarre  speculated  that there  would  be a                 
  fiscal impact to the Department of Law.  He thought that the                 
  legislation would  be challenged on a  constitutional basis.                 
  Representative Grussendorf summarized that  the two previous                 
  Committees agreed to  the same  changes, whereas, the  House                 
  Finance Committee is  proposing to adopt the  original bill,                 
  at the  same time  in which  it will  be before  the Supreme                 
  Court.                                                                       
                                                                               
  Representative  Brown  reiterated  her  original  objection,                 
  noting  that   the  Committee  should   be  considering  the                 
  standard,  including the  constitutional  obligations.   The                 
  Constitution clearly states  that all  people are equal  and                 
  have  equal  rights.   The  Legislation specifies  groups of                 
  persons  equally  qualified,  who  are  being  discriminated                 
  against.    She continued,  CS  HB 226  (FIN)  would mandate                 
  legislative discrimination which she strongly opposes.                       
                                                                               
  Representative Kohring  voiced his support of  the committee                 
  substitute.   He  spoke  to  the  philosophical  differences                 
  between Committee members and addressed  the economical cost                 
  to the State.                                                                
                                                                               
  Representative Brown  asked what the term  "legal dependent"                 
  meant.   Representative Kelly  spoke to  Amendment #1  which                 
  would change that language to "children".                                    
                                                                               
  A roll call was taken on the MOTION to adopt CS HB 226 (FIN)                 
  as the version before the Committee.                                         
                                                                               
       IN FAVOR:      Martin,   Mulder,   Therriault,   Kelly,                 
                                                                               
                               10                                              
                                                                               
                                                                               
  Kohring,                 Hanley, Foster.                                     
       OPPOSED:       Navarre, Brown, Grussendorf.                             
                                                                               
  Representative Parnell was not present for the vote.                         
                                                                               
  The MOTION PASSED (7-3).                                                     
                                                                               
  Representative Kelly MOVED Amendment  #1.  [Attachment  #3].                 
  Representative  Brown  asked  if  a  couple  in  a  domestic                 
  partnership were non-marital status and  one of the partners                 
  had   children,    would   those   children    be   covered.                 
  Representative Therriault  replied that the children  of the                 
  employed partner would be covered.                                           
                                                                               
  Representative  Brown  asked who  would  be excluded  by the                 
  amendment.  Representative Kelly noted that  no one would be                 
  excluded.   He stated that  the term "legal  dependents" was                 
  too broad.    There being  NO  OBJECTION, Amendment  #1  was                 
  adopted.                                                                     
                                                                               
  Representative Mulder MOVED to report CS HB 226 (FIN) out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.  Representative Brown OBJECTED.                    
                                                                               
  A roll call  was taken on the  MOTION to move the  bill from                 
  Committee.                                                                   
                                                                               
       IN FAVOR:      Mulder,   Therriault,   Kelly,  Kohring,                 
  Martin,                  Foster, Hanley.                                     
       OPPOSED:       Navarre, Brown, Grussendorf.                             
                                                                               
  Representative Parnell was not present for the vote.                         
                                                                               
  The MOTION PASSED (7-3).                                                     
                                                                               
  CS  HB 226 (FIN)  was reported out  of Committee with  a "do                 
  pass'  recommendation  and   with  a  fiscal  note   by  the                 
  Department of Administration.                                                
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 12:50 P.M.                                          
                                                                               
                                                                               
                     HOUSE FINANCE COMMITTEE                                   
                        JANUARY 30, 1996                                       
                           10:40 A.M.                                          
                                                                               
  TAPE HFC 96 - 21, Side 1, #000 - end.                                        
  TAPE HFC 96 - 21, Side 2, #000 - end.                                        
  TAPE HFC 96 - 22, Side 1, #000 - end.                                        
                                                                               
                                                                               
                               11                                              
                                                                               
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair  Mark Hanley  called  the  House Finance  Committee                 
  meeting to order at 10:40 A.M.                                               
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Hanley               Representative Martin                          
  Co-Chair Foster               Representative Mulder                          
  Representative Brown          Representative Navarre                         
  Representative Grussendorf    Representative Kohring                         
  Representative Kelly          Representative Therriault                      
                                                                               
  Representative Parnell was not present for the meeting.                      
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Mark Tumeo, (Testified via teleconference), Antarctica; Kate                 
  Wattum,  (Testified  via teleconference),  Fairbanks; Daniel                 
  Collison, Board  Member, Southeast  Alaska  Gay and  Lesbian                 
  Alliance,   Juneau;   Stephen   Jacquier,   (Testified   via                 
  teleconference), Self, Anchorage;  Lynn Stimler,  (Testified                 
  via  teleconference),   Executive  Director,American   Civil                 
  Liberties Union (ACLU), Anchorage; Tom Owens, (Testified via                 
  teleconference),   Attorney,   Representing   University  of                 
  Alaska, Anchorage; Mildred Boesser,  Juneau City and Borough                 
  Human  Rights  Commission,   Juneau;  Susan  Hargis,  Chair,                 
  Southeast Alaska Gay and Lesbian  Alliance (SEAGLA), Juneau;                 
  Marsha Buck, Parents,  Families and Friends of  Lesbians and                 
  Gays  (PFLAG),  Juneau;  Sara  Boesser,  Board  Member,  the                 
  Committee  for  Equality,  Juneau;  Pam LaBolle,  President,                 
  Alaska State Chamber of Commerce -Juneau.                                    
                                                                               
  SUMMARY                                                                      
                                                                               
  HB 226    An  Act  permitting  the  provision  of  different                 
            retirement and health benefits  to employees based                 
            on marital status.                                                 
                                                                               
            CS HB 226 (FIN) was reported out of Committee with                 
            a "do pass" recommendation and  with a fiscal note                 
            by the Department of Administration.                               
                                                                               
  HOUSE BILL 226                                                               
                                                                               
       "An   Act   permitting  the   provision   of  different                 
       retirement and  health benefits  to employees  based on                 
       marital status."                                                        
                                                                               
  MARK  TUMEO,  ANTARCTICA,  (TESTIFIED  VIA  TELECONFERENCE),                 
  testified  on  HB   226  and   the  proposed  amendment   by                 
  Representative  Kelly.    He stated  that  providing  health                 
                                                                               
                               12                                              
                                                                               
                                                                               
  benefits to the  domestic partner of  an employee would  not                 
  represent  a  threat  to  the  State's economy,  the  social                 
  fabric, marriage or society.   He noted that the  University                 
  of Alaska  has already instituted  domestic partner benefits                 
  without major administrative or economic  impact.  There has                 
  been less that a .5% increase to benefit costs.                              
                                                                               
  Mr. Tumeo agreed  that the bill was  "highly" controversial.                 
  It is a bill that deals with the definition of relationship;                 
  a bill which touches the core  of every Alaskan's concept of                 
  fair play and  morality.  He added,  the arguments presented                 
  to  support the bill  were emotional and  that those persons                 
  opposing the bill are at a distinct disadvantage.  Mr. Tumeo                 
  questioned  if   "emotional  moralism"  was   a  politically                 
  successful basis for legislation.  He felt that the proposed                 
  legislation would attempt to legislate in favor of one group                 
  of people--married  people--over another  group--non-married                 
  people.                                                                      
                                                                               
  Mr. Tumeo thought  that passage of the  legislation would be                 
  another  example  of the  government  intruding  in personal                 
  affairs.  He urged  Committee members to "kill" the  bill as                 
  he felt that it would gut the Human Rights Act in an attempt                 
  to enforce one type of family structure over another.  [Copy                 
  of testimony on file].                                                       
                                                                               
  Representative Brown asked  the current status of  the court                 
  suit.  Mr.  Tumeo explained that  it was pending before  the                 
  Supreme Court and that a decision would be issued in Spring,                 
  1996.                                                                        
                                                                               
  Representative   Martin  voiced   strong   support  of   the                 
  traditional family rights,  stating that the core  issue was                 
  being  degraded.    Mr.  Tumeo  explained  that  information                 
  resulting from the 1990 census indicates that less  than 40%                 
  of the children in  our country are  raised in a two  parent                 
  home where one  parent stays home.   He emphasized the  fact                 
  that there are many different family structures.                             
                                                                               
  Mr. Tumeo responded to a question regarding the court brief.                 
  He stated it was not the  legal argument which was supported                 
  or presented  by the  Supreme Court.   He  acknowledged that                 
  there should be a "tight" fence around who could qualify for                 
  the  benefits.     Representative  Therriault   stated  that                 
  information needed clarification by the Human Rights Act.                    
                                                                               
  Mr. Tumeo  added, following  the Court's  decision, the  law                 
  will be eliminated or expanded reflecting the interpretation                 
  of that decision.   He added, it would  be premature to  act                 
  before  the   Supreme  Court   decision,  entering  into   a                 
  possibility of amending a critical law.                                      
                                                                               
                                                                               
                               13                                              
                                                                               
                                                                               
  Representative Therriault voiced his  concern that no  limit                 
  existed, pointing out when the Human Rights Act was enacted,                 
  it was not anticipated the need that this circumstance would                 
  exist.                                                                       
                                                                               
  Representative Kelly spoke  to the amendment adopted  by the                 
  House  HESS  Committee  as  proposed  by   Mr.  Tumeo.    He                 
  questioned isolating the concept of "domestic partnerships",                 
  suggesting that the criteria proposed  would allow anyone to                 
  buy into or out of the program.  Mr. Tumeo explained various                 
  approaches  to domestic  partnerships  which can  be legally                 
  binding.  He  added, as with  any benefit or condition  upon                 
  which a benefit is  given, the conditions can change.   Once                 
  the status changes,  the individual would be  responsible to                 
  report that.  He continued, there are plenty of stipulations                 
  to address the fraud concerns, and  that the University does                 
  have a qualification waiting period.  Mr. Tumeo acknowledged                 
  Representative   Kelly's   concern   agreeing    that   some                 
  relationships are not long lasting and pointing out that was                 
  true of marriage's also.                                                     
                                                                               
  Representative Kelly  disagreed.   He stated  that a  person                 
  could  get  into  and  out  of  domestic  partnerships  more                 
  quickly; a domestic partnership ends  when the partners stop                 
  living together.   Representative Kelly added that  the non-                 
  traditional relationship will leave behind broken marriages,                 
  broken   neighborhoods  and  broken  families.    Mr.  Tumeo                 
  countered that a  domestic partnership  does not threaten  a                 
  marriage.  Non-traditional relationships can be entered into                 
  and exited just as a marriage can.  Mr. Tumeo concluded that                 
  relationships of either  type should  not be of  legislative                 
  interest.                                                                    
                                                                               
  Representative Kelly elaborated that the changes made to the                 
  legislation in the  two previous committee's could  threaten                 
  partners  within  a  domestic partnership.    Representative                 
  Kelly explained the origin of the legislation, noting that a                 
  recent court decision  ordered the  University of Alaska  to                 
  extend health  insurance coverage and  benefits to  domestic                 
  partners.  HB 226 would address the decision by  reasserting                 
  the rights  of employers,  including the  State, to  exclude                 
  domestic  partners from  health  insurance benefits,  unless                 
  they choose otherwise.   He added, it was his intent that HB
  226 reduce the  uncertainty employers  now face in  planning                 
  group insurance programs.                                                    
                                                                               
  Representative  Kelly  added,  the  court  decision   leaves                 
  unclear who is, and who is not, entitled to family benefits.                 
  HB 226 would seek  to close the door on a possible onslaught                 
  of  domestic  partnerships  created just  to  gain benefits.                 
  Representative  Kelly urged the  Committee's support  of the                 
  original legislation or the House Finance Committee version.                 
                                                                               
                               14                                              
                                                                               
                                                                               
  KATE  WATTUM,  (TESTIFIED  VIA  TELECONFERENCE),  FAIRBANKS,                 
  spoke against HB 226 which she felt would specifically write                 
  "discrimination" into law.  She emphasized that the proposed                 
  legislation is about "emotion" and "people", and that people                 
  will  be  hurt  with its  passage.    She  thought that  the                 
  extended benefits  program should  be issued  to all  family                 
  members who qualify.                                                         
                                                                               
  Representative  Martin   asked  if   Ms.  Wattum's   partner                 
  currently had a health package.   Ms. Wattum explained  that                 
  her partner  does currently  have  coverage and  that it  is                 
  supplemented  with  her own  policy through  the University.                 
  Representative Martin expounded his theories on the legality                 
  of  marriage  and the  rights which  come with  that choice.                 
  Representative Martin  added that  the State  should not  be                 
  required to pay  for equal rights in  domestic partnerships.                 
  Ms. Wattum remarked  that all she  was requesting was  equal                 
  access to  a benefit which  every other married  employee of                 
  the University has access to for their spouses and children.                 
                                                                               
                                                                               
  Representative Kelly pointed out that  if the court decision                 
  was held and  that domestic  partnerships were created,  Ms.                 
  Wattum would  be paid  more than  the single  person who  is                 
  employed at the same work place.  He emphasized that the act                 
  would create  a new  class of  people.  Discussion  followed                 
  between Ms. Wattum and  Representative Kelly regarding  this                 
  "new" class of people.                                                       
                                                                               
  DANIEL  COLLISON, BOARD  MEMBERS,  SOUTHEAST ALASKA  GAY AND                 
  LESBIAN ALLIANCE  (SEAGLA), JUNEAU, distributed a  letter to                 
  Committee members  from  Bob  Miller,  Director,  Office  of                 
  Public Affairs, University of Alaska.  [Attachment #1].  Mr.                 
  Collison spoke against HB 226 and/or  in support of the HESS                 
  version of the legislation.                                                  
                                                                               
  He pointed out that the University has received less than 1%                 
  increase in plan  enrollments.  Mr. Collison  referenced the                 
  letter  [Attachment  #1], clarifying  that  to date  only 44                 
  employees  have  registered their  partners in  the domestic                 
  health plan.  One third of these individuals are in same sex                 
  relationships; additionally, nine children  were registered.                 
  He observed  that the  recognition of  domestic partnerships                 
  would not place an undue burden on the State.   Mr. Collison                 
  urged the passage of HB 226 with the HESS amendment.                         
                                                                               
  Representative  Martin  reiterated his  concerns recognizing                 
  non-traditional families  and relationships.   Mr.  Collison                 
  reminded Representative Martin that the question  before the                 
  Committee was access  to the  benefits on economic  grounds.                 
                                                                               
                               15                                              
                                                                               
                                                                               
  He stressed the issue is the court  has indicated that it is                 
  wrong to discriminate against domestic partnerships.                         
                                                                               
  (Tape Change, HFC 96-21, Side 2).                                            
                                                                               
  Mr. Collison  reiterated that  the Supreme  Court is  due to                 
  rule on that issue this spring.                                              
                                                                               
  Representative Therriault felt that the court  decision does                 
  not  address  the  main  concern  of  discrimination.    Mr.                 
  Collison  interjected  that  the  court  decision  was being                 
  decided  on  access to  benefits.   A  marriage relationship                 
  carries with  it  inter-financial  legal  obligations.    He                 
  pointed out that he could have a relationship with a man and                 
  have those  same responsibilities.   The court is  trying to                 
  clarify  that  there  can  exist   two  different  types  of                 
  contractual relationships; one entered  into by marriage and                 
  another  one  entered  into  privately  by  two individuals,                 
  recognized as a domestic partner relationship.  The court is                 
  not  creating  different  classes  of  people,  but  instead                 
  interpreting why certain people are being denied benefits.                   
                                                                               
  STEPHEN    JACQUIER,    (TESTIFIED    VIA   TELECONFERENCE),                 
  REPRESENTING SELF, ANCHORAGE, spoke strongly against passage                 
  of the proposed legislation.                                                 
                                                                               
  Representative  Grussendorf advised  that the law  in Alaska                 
  currently  is  based on  the  decision of  Judge  Green, who                 
  indicated the action  attempted by the University  of Alaska                 
  was discriminatory in nature.  He reminded Committee members                 
  that the  case was  currently  before the  Supreme Court  on                 
  appeal with a  decision soon to be  made.     Representative                 
  Grussendorf  summarized   that  the  HESS  version   of  the                 
  legislation does support the opinion of Judge Green.                         
                                                                               
  LYNN  STIMLER,  (TESTIFIED  VIA  TELECONFERENCE),  EXECUTIVE                 
  DIRECTOR, AMERICAN CIVIL LIBERTIES  UNION (ACLU), ANCHORAGE,                 
  explained that the issue of HB 226 should not exist while it                 
  is pending before the  Supreme Court.  She pointed  out that                 
  the ACLU is opposed to the original  HB 226.  She noted that                 
  it is outside  the spirit and  plain language of the  Alaska                 
  Constitution and the Alaska Human Rights Act.                                
                                                                               
  Ms. Stimler  addressed  the economics,  noting that  private                 
  employers extend these  type of benefits because it  is good                 
  business  practice.    Employers  know  and  understand that                 
  today's work  force is  comprised of  many people  living in                 
  many different types of situations.  The Alaska Constitution                 
  is more broadly  protective of the individuals  civil rights                 
  and liberties than the U.S. Constitution is.                                 
                                                                               
  Ms. Stimler reiterated that  the ACLU believes the  State is                 
                                                                               
                               16                                              
                                                                               
                                                                               
  "out of place"  debating these concerns  while the issue  is                 
  before the Supreme Court.  To adopt language amending law to                 
  specifically allow discrimination  because of marital status                 
  is against the spirit and plain language of the Alaska Human                 
  Rights Act.  She urged the Legislature not to be involved in                 
  such a discriminating policy.                                                
                                                                               
  TOM   OWENS,   (TESTIFIED  VIA   TELECONFERENCE),  ATTORNEY,                 
  REPRESENTING THE UNIVERSITY OF ALASKA - ANCHORAGE, commented                 
  that the  provisions of  A.S. 18:80  only applies to  public                 
  employers.  The  State anti-  discrimination laws have  been                 
  made  inapplicable to qualify  for benefits or  plans in the                 
  private sector.   He  added, it  is important  to note  that                 
  Judge Green's decision  was not based on  any constitutional                 
  analysis.                                                                    
                                                                               
  Mr. Owens added, the purpose of the proposed amendment, A.S.                 
  18:80, was to confirm the statutory scheme which has existed                 
  in the  State of Alaska for many  years.  This scheme allows                 
  public   employers  to  discriminate  in  the  provision  of                 
  benefits on the basis of marital status  or parental status.                 
  He continued, the purpose of  the proposed legislation would                 
  confirm  that  the Legislature  never  intended to  have the                 
  provisions of A.S.  18:80 prohibit  the provision of  health                 
  care benefits on the bases of marital or parental status.                    
                                                                               
  Representative  Grussendorf asked  if the bill  would affect                 
  the private sector.  Mr. Owens  replied that Judge Green did                 
  not get to the constitutional issues because she didn't need                 
  to.  She  based her  decision upon reading  the language  of                 
  A.S. 18:80, adding  that the courts  make their decision  on                 
  the lowest  level of  consideration.   The applicability  of                 
  A.S.  18:80  to the  private sector  would  be based  on the                 
  federal court ruling in 1974.   The State antidiscrimination                 
  laws do  not apply  to the  provisions of  benefits under  a                 
  qualified plan in the private sector.                                        
                                                                               
  Representative Martin pointed out the amenities available to                 
  University  teachers,  health   care,  tuition  and  benefit                 
  waivers.  He reminded Committee members that the Legislature                 
  continues to be responsible for the University budget.                       
                                                                               
  Representative  Therriault  questioned how  Judge  Green got                 
  beyond statute areas which mandate the differentiation.  Mr.                 
  Owens responded that Judge Green made her decision through a                 
  written opinion.   His  comments on  her decision are  based                 
  upon a reading  of that decision.  Judge  Green did not make                 
  any comments regarding  the other statutory  provisions that                 
  either  mandate  or permit  discrimination based  on marital                 
  status.  After Judge Green made her decision, the University                 
  made a motion to reconsider, pointing out to Judge Green the                 
  existence of the other statutes  which level the Legislative                 
                                                                               
                               17                                              
                                                                               
                                                                               
  intent  to  file  or  require  discrimination  provision  of                 
  benefits based  on marital status.   Judge Green  refused to                 
  consider  those  arguments  and   thus  continued  with  her                 
  original decision.                                                           
                                                                               
  MILDRED  BOESSER,  JUNEAU   CITY  &  BOROUGH   HUMAN  RIGHTS                 
  COMMISSION, JUNEAU, provided Committee members  with a Human                 
  Rights Commission, City and Borough of Juneau (CBJ) Position                 
  Paper on  HB 226.  [Attachment #2].   She noted that the CBJ                 
  Committee opposes  HB 226  because it  discriminates against                 
  committed  partners  to  the  detriment  of  Alaska  and  in                 
  violation of the Constitution.                                               
                                                                               
  Mrs. Boesser understood that the legislation resulted from a                 
  fear to undermine  the traditional  family unit, whereas  in                 
  reality, the concept of "domestic partners" is an attempt to                 
  enlarge  the concept  of family  to include  non-traditional                 
  groupings which  exist everywhere already.   She recommended                 
  that this group  is in need  of the family  support and  the                 
  benefits that traditional families enjoy.                                    
                                                                               
  Mrs.  Boesser acknowledged  that we all  live in  a changing                 
  society  and  that  many different  types  of  families have                 
  emerged.    She  encouraged supporting  people  that  are in                 
  loving, stable  relationships, even when  that picture  does                 
  not include our own view of family.                                          
                                                                               
  Co-Chair Hanley  asked if  CBJ allows  domestic partners  to                 
  share in benefits.  Mrs. Boesser replied they do not at this                 
  time.                                                                        
                                                                               
  Representative  Kelly  pointed  out  that  the  Alaska Human                 
  Rights Commission did not support Judge Greens decision.                     
                                                                               
  SUSAN  HARGIS,  CHAIR,  SOUTHEAST  ALASKA  GAY  AND  LESBIAN                 
  ALLIANCE (SEAGLA), JUNEAU,  testified against  HB 226.   She                 
  pointed  out  that  the  legislation  was initiated  on  the                 
  premise  of  "financial  burden"   as  initially  stated  by                 
  Representative  Kelly  in  the House  HESS  Committee.   She                 
  reminded Committee  members of  evidence that  the financial                 
  cost would be  less than .5%.   Ms. Hargis added that  it is                 
  important that more  children be covered and  have access to                 
  health care.                                                                 
                                                                               
  In response  to Representative  Kelly's comment,  Ms. Hargis                 
  agreed that fraud  does exist  within any system,  although,                 
  stated  that all  employees deserve  the same  rights.   Ms.                 
  Hargis urged Committee members to either "kill"  the bill or                 
  pass the version adopted by the House HESS Committee.                        
                                                                               
  Representative Therriault warned that the end result of this                 
  argument could be  that only  employees are  covered by  the                 
                                                                               
                               18                                              
                                                                               
                                                                               
  insurance  benefits.    Ms. Hargis  agreed  that  this could                 
  happen.                                                                      
                                                                               
  Representative Kelly noted  that the issue  is not how  many                 
  same sex people versus how many opposite sex people sign up.                 
  To date 45 people  have signed up.  Aetna  Insurance Company                 
  has stated the cost.   Representative Kelly noted  that cost                 
  would be  equivalent to the  cost of a  university professor                 
  for  a  one year  salary.   Aetna  does assume  a percentage                 
  increase each  year.   Representative Kelly  emphasized that                 
  these costs will  grow, and that  they are a moving  target.                 
  Ms.  Hargis replied that  Aetna has also  clarified that the                 
  amount   does  increase,  although,  the  increase  for  any                 
  organization participating has  not exceeded  the 3% cap  in                 
  the past several years.                                                      
                                                                               
  (Tape Change, HFC 96-22, Side 1).                                            
                                                                               
  Ms.  Hargis concluded that the  State would be better served                 
  by providing more people access to health care.                              
                                                                               
  MARSHA BUCK, PARENTS,  FAMILIES AND FRIENDS OF  LESBIANS AND                 
  GAYS (PFLAG), JUNEAU, provided Committee members with a copy                 
  of a letter from Dixie Hood, Co-Chair, PFLAG, indicating the                 
  position  of  that  group.   [Copy  on  file].   The  letter                 
  requested that the  bill die  in Committee, suggesting  that                 
  the matter be addressed by the employer and the employee.                    
                                                                               
  Ms. Buck noted  that she  agreed with the  testimony of  Ms.                 
  Hood  and  encouraged the  bill to  die  in Committee.   She                 
  stated  that  as  a  parent  of  a daughter  in  a  domestic                 
  relationship, the  bill as  written was  divisive and  deals                 
  with matters of personal freedom.  Representative Therriault                 
  commented that the people of Alaska are the employers of the                 
  University of  Alaska employees,  of which  he represents  a                 
  specific group  of those shareholders, who think differently                 
  than Ms. Buck.                                                               
                                                                               
  SARA  BOESSER,  BOARD  MEMBER, STATEWIDE  ORGANIZATION,  THE                 
  COMMITTEE FOR EQUALITY,  JUNEAU, spoke  in opposition to  HB
  226.   She  advised  that the  Committee  for Equality  does                 
  support the HESS version of the legislation and that version                 
  matches the court action.  [Copy of testimony on file].                      
                                                                               
  Ms. Boesser recommended the House Finance Committee send the                 
  bill  to a subcommittee to  research the legal and financial                 
  implications  of  any  changes that  would  cross  the court                 
  proceedings now in progress.   She continued, in the  extent                 
  that  Representative  Kelly   opposes  equal  benefits   for                 
  domestic partnerships on religious beliefs  he may hold, the                 
  Committee  should remember that  while the U.S. Constitution                 
  does  protect  people from  discrimination  on the  basis of                 
                                                                               
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  religion,  that  protection   also  includes  freedom   from                 
  religion.                                                                    
                                                                               
  In conclusion, Ms. Boesser, summarized that CS 226 (JUD)  as                 
  passed was a good bill, but  unnecessary, due to the pending                 
  court action at this time.                                                   
                                                                               
  Representative  Kelly  addressed   the  legislative   ethics                 
  concern,  pointing out that  the bill does  not ban domestic                 
  partnerships.  The proposed legislation  only states that if                 
  you  choose as  an  employer or  employee  not to  recognize                 
  domestic partnerships to give benefits, you can choose to do                 
  so.  He added that these concerns are defined  in the Alaska                 
  Statutes and are determined  on that level; not the  Supreme                 
  Court.   Ms. Boesser  disagreed, stating  that the  bill was                 
  specifically written in order to discriminate against people                 
  in domestic relationships.                                                   
                                                                               
  PAM LABOLLE,  PRESIDENT, ALASKA  STATE CHAMBER  OF COMMERCE,                 
  JUNEAU, advised that  the Alaska  State Chamber of  Commerce                 
  represents  nearly 700  employers statewide  which employees                 
  7,000 employees.   The Alaska State Chamber  of Commerce has                 
  no position on the traditional  or non-traditional aspect of                 
  the legislation.  She advised  that the Chamber's concern is                 
  that without  the proposed  legislation, there  would be  an                 
  expansion of  the benefit  pool which  would increase  State                 
  spending.    Ms.  LaBolle  commented  that  the  number  one                 
  priority  of  the State  Chamber  was a  reduction  of State                 
  spending.                                                                    
                                                                               
  Ms. LaBolle continued, private  employers are in competition                 
  with  the  State.   The  State  pays a  much  better benefit                 
  package than a private employer can afford and thus, private                 
  industry loses good employees to the  State work force.  She                 
  suggested  that  to  level  the  playing  field  would  give                 
  coverage for the actual employee and the additional coverage                 
  would be paid for individually for each dependent.                           
                                                                               
  Representative  Navarre  argued   that  the  benefits  which                 
  already exist cause the  competition with private employers,                 
  not  those   being   discussed   for   the   non-traditional                 
  households.    He  stated  that  the  competition  would  be                 
  minimally  impacted  by the  application of  the bill.   Ms.                 
  LaBolle  emphasized  that all  the  facts are  not currently                 
  available.   She thought  anything that was  done to enhance                 
  the  State's  benefits  would  place  the State  in  greater                 
  competition with the private sector.  Representative Navarre                 
  responded that the intent was  to extend benefits to  people                 
  already employed and would not be used as a recruitment tool                 
  by the State.                                                                
                                                                               
  Representative  Mulder  MOVED that  CS HB  226 (FIN)  be the                 
                                                                               
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  version  before   the  Committee.     Representative   Brown                 
  OBJECTED.                                                                    
                                                                               
  Representative Navarre  asked for  further clarification  of                 
  "domestic partnership".   Co-Chair Hanley  noted that CS  HB
  226 (FIN)  would return the law  to the place it  was before                 
  Judge  Greens  decision.   Statutorily,  the  decision would                 
  close the questions  which Judge Green had,  clarifying that                 
  discrimination is allowed  in that particular instance.   He                 
  added that the  strict definition of  marriage would be  the                 
  dividing line.                                                               
                                                                               
  Representative  Navarre  speculated that  there  would be  a                 
  fiscal impact to the Department of Law.  He thought that the                 
  legislation would be challenged  on a constitutional  basis.                 
  Representative Grussendorf summarized that  the two previous                 
  Committees agreed to  the same  changes, whereas, the  House                 
  Finance Committee is  proposing to adopt the  original bill,                 
  at  the same  time in which  it will  be before  the Supreme                 
  Court.                                                                       
                                                                               
  Representative  Brown  reiterated  her  original  objection,                 
  noting   that  the  Committee   should  be  considering  the                 
  standard,  including the  constitutional  obligations.   The                 
  Constitution clearly states  that all  people are equal  and                 
  have  equal  rights.   The  Legislation specifies  groups of                 
  persons  equally  qualified,  who  are  being  discriminated                 
  against.    She continued,  CS  HB 226  (FIN)  would mandate                 
  legislative discrimination which she strongly opposes.                       
                                                                               
  Representative Kohring  voiced his support of  the committee                 
  substitute.    He  spoke  to  the  philosophical differences                 
  between Committee members and  addressed the economical cost                 
  to the State.                                                                
                                                                               
  Representative Brown asked what  the term "legal  dependent"                 
  meant.   Representative Kelly  spoke to  Amendment #1  which                 
  would change that language to "children".                                    
                                                                               
  A roll call was taken on the MOTION to adopt CS HB 226 (FIN)                 
  as the version before the Committee.                                         
                                                                               
       IN FAVOR:      Martin,   Mulder,   Therriault,   Kelly,                 
  Kohring,                 Hanley, Foster.                                     
       OPPOSED:       Navarre, Brown, Grussendorf.                             
                                                                               
  Representative Parnell was not present for the vote.                         
                                                                               
  The MOTION PASSED (7-3).                                                     
                                                                               
  Representative  Kelly MOVED Amendment  #1.  [Attachment #3].                 
  Representative  Brown  asked  if  a  couple  in  a  domestic                 
                                                                               
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  partnership were non-marital status and  one of the partners                 
  had   children,    would   those   children    be   covered.                 
  Representative Therriault  replied that the children  of the                 
  employed partner would be covered.                                           
                                                                               
  Representative  Brown  asked who  would  be excluded  by the                 
  amendment.  Representative Kelly noted that  no one would be                 
  excluded.   He stated that  the term "legal  dependents" was                 
  too broad.    There being  NO  OBJECTION, Amendment  #1  was                 
  adopted.                                                                     
                                                                               
  Representative Mulder MOVED to report CS HB 226 (FIN) out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.  Representative Brown OBJECTED.                    
                                                                               
  A roll call  was taken on the  MOTION to move the  bill from                 
  Committee.                                                                   
                                                                               
       IN FAVOR:      Mulder,   Therriault,   Kelly,  Kohring,                 
  Martin,                  Foster, Hanley.                                     
       OPPOSED:       Navarre, Brown, Grussendorf.                             
                                                                               
  Representative Parnell was not present for the vote.                         
                                                                               
  The MOTION PASSED (7-3).                                                     
                                                                               
  CS HB 226  (FIN) was  reported out of  Committee with a  "do                 
  pass'  recommendation  and   with  a  fiscal  note   by  the                 
  Department of Administration.                                                
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 12:50 P.M.                                          
                                                                               
                                                                               
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