Legislature(2007 - 2008)HOUSE FINANCE 519
02/13/2008 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB325 | |
| HB285 | |
| HB65 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 325 | TELECONFERENCED | |
| + | HB 285 | TELECONFERENCED | |
| += | HB 65 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
February 13, 2008
2:05 p.m.
CALL TO ORDER
Co-Chair Meyer called the House Finance Committee meeting to
order at 2:05:15 PM.
MEMBERS PRESENT
Representative Mike Chenault, Co-Chair
Representative Kevin Meyer, Co-Chair
Representative Bill Stoltze, Vice-Chair
Representative Harry Crawford
Representative Les Gara
Representative Mike Hawker
Representative Reggie Joule
Representative Mike Kelly
Representative Mary Nelson
Representative Bill Thomas Jr.
MEMBERS ABSENT
Representative John Harris
ALSO PRESENT
Bryan Butcher, Legislative Liaison, Alaska Housing Finance
Corporation; Dan Fauske, CEO/Executive Director, Alaska
Housing Finance Corporation, Department of Revenue; Karen
Lidster, Staff, Representative John Coghill; Representative
John Coghill, Sponsor; Megan Foster, Staff, Representative
Les Gara.
PRESENT VIA TELECONFERENCE
Paul Kapansky, Director, Mortgage Operations, Alaska Housing
Finance Corporation; Susan Fernandez, Self.
SUMMARY
HB 65 "An Act relating to breaches of security involving
personal information, credit report and credit
score security freezes, consumer credit
monitoring, credit accuracy, protection of social
security numbers, care of records, disposal of
records, identity theft, furnishing consumer
credit header information, credit cards, and debit
cards, and to the jurisdiction of the office of
administrative hearings; amending Rule 60, Alaska
Rules of Civil Procedure; and providing for an
effective date."
HB 65 was heard and HELD in Committee for further
consideration.
HB 285 "An Act relating to an optional exemption from
municipal property taxes for residences of widows
and widowers of certain members of the armed
forces of the United States; and providing that
this Act may be known as the Sergeant Irving
Hernandez, Jr., Act."
CSHB 285 (CRA) was REPORTED out of Committee with
a "do pass" recommendation and with zero note #1
by the Department of Commerce, Community and
Economic Development.
HB 325 "An Act relating to the teachers' and nurses'
housing loan program in the Alaska Housing Finance
Corporation; and providing for an effective date."
CSHB 325 (FIN) was REPORTED out of Committee with
a "do pass" recommendation and with zero note #1
by the Department of Revenue.
HOUSE BILL NO. 325
"An Act relating to the teachers' and nurses' housing
loan program in the Alaska Housing Finance Corporation;
and providing for an effective date."
BRYAN BUTCHER, LEGISLATIVE LIAISON, ALASKA HOUSING FINANCE
CORPORATION (AHFC), gave an overview of HB 325. In 2003, SB
25 established a teachers and registered nurses housing loan
program. Buying a home, particularly the cash down payment,
had been an obstacle for young teachers and nurses in many
communities across the state. The idea was to set up a zero-
down payment program to remedy the problem. A five year
sunset was put on SB 25 due to concerns that if consumers
didn't invest money initially they would be more likely to
walk away from the loan. The program has been successful.
House Bill 325 would lift the sunset and would expand
"nurses" to "health care professionals."
Mr. Butcher said that since the program was initiated in
2003, 373 teachers and nurses have mortgaged homes in 34
communities across the state. To date there has been only
one foreclosure. Alaska Housing Finance Corporation
foreclosure rates are low and rates of this program are even
lower. He emphasized that the program is not a subsidy
program; there is no interest break. Applicants have to pass
AHFC's normal guidelines for getting a mortgage.
2:08:51 PM
Representative Crawford asked for a definition of "health
care professionals." He wondered if doctors were included.
Mr. Butcher replied that there had been discussions with the
Governor's office about the definition. They realized it
would be easy to miss an occupation.
Mr. Butcher referred to a different program in the capital
budget that funds housing for rural teachers and health care
professionals. The definition of who is qualified in that
program is: any person who is licensed or board-certified by
the State of Alaska in a health profession, holds a State
certification in a health occupation, or is an administrator
of a hospital or clinic or employed as an aide, assistant,
counselor, or technician in a health field. Occupancy in the
household is limited to health professionals and family
members.
Representative Crawford asked if dental assistants and
hygienists were included. He reiterated concerns about
doctors using the program.
Mr. Butcher said AHFC discussed whether there should be an
income cap on the program. They questioned having a zero-
down program for someone making $500,000 a year. However,
after talking with mortgage experts, the conclusion was
reached that a doctor making $500,000 would not use the
program. Most of AHFC's portfolio consists of rural,
veterans, and first-time homebuyer loans, making AHFC a
lender of "last resort." A person making more money could
get a better interest rate by shopping around, so it would
not make sense for someone with a large income buying a
large home to skip a down payment in exchange for having to
pay a lot more money. In addition, AHFC's experience over
the past five years has been that fears regarding a cap were
unfounded. The house cannot be used as investment property
since users of the program must live in it.
2:12:05 PM
Representative Hawker asked for specifics relating to both
delinquency and foreclosure. Mr. Butcher did not have the
delinquency numbers, although he knew they were low. Until
very recently the foreclosure rates were at zero.
Representative Hawker wondered about defaults.
DAN FAUSKE, CEO/EXECUTIVE DIRECTOR, ALASKA HOUSING FINANCE
CORPORATION, DEPARTMENT OF REVENUE, said that people
occasionally get behind on their payments. However, AHFC has
tracked this and found that the delinquency rate goes down
around the time the permanent fund checks come out.
rd
Delinquency rates through AHFC are 43 in the nation, with
50 being the best. He said there is not a significant
problem in Alaska. Foreclosures are well within historical
norms and well below national average. Regarding the concern
of someone making a great deal of money using this program,
Mr. Fauske pointed out that zero-down buyers must have
mortgage insurance. If an investor was going to be paying
more, they would rather put the money down and free up the
cash.
2:15:27 PM
Representative Hawker asked, regarding the removal of the
sunset date, how open-ended AHFC wanted the program to be.
Mr. Fauske pointed out that the program evolved because of
recognized need. The sunset provision was added in order to
test the program. Across the country, housing finance
agencies are trying to come up with solutions for the same
challenges that AHFC has been dealing with successfully.
Teachers everywhere have difficulty affording a home. He
thought the program was doing exactly what it was designed
to do and hoped to see it continue.
Representative Hawker reiterated his desire for specific
information regarding delinquency rates and credit
experience with the consumers of the program.
PAUL KAPANSKY, DIRECTOR, MORTGAGE OPERATIONS, ALASKA HOUSING
FINANCE CORPORATION (TESTIFIED VIA TELECONFERENCE), spoke
to the issue of foreclosures and delinquencies. He said that
over the four year period that the program has been in
place, there have been 378 loans, with one foreclosure. He
said AHFC doesn't specifically track delinquency in the
program, but delinquency rates are around 3.5%, which is
historically low. He said the program has performed very
well.
2:19:02 PM
Representative Hawker was surprised to hear the State
doesn't track delinquency rates by program, as those rates
are a benchmark measure of performance. Mr. Kapansky said
historically AHFC hasn't tracked delinquency rates because
the foreclosure rate is so low. There didn't seem to be a
need.
Representative Gara had previously thought the program got
teachers lower interest rate loans. He wondered if a person
could still shop around for the best bank rate or if they
had to accept a higher interest rate through AHFC in
exchange for the zero-down. Mr. Kapansky answered that the
loan option is only good with an Alaska Housing Finance
loan. The loan could be processed under the veterans'
program or the tax-exempt first-time home-buyer program.
Those interest rates are currently approximately 5.5%, which
is a very attractive interest rate.
Representative Gara wondered if someone would be able to
find a lower interest mortgage than they could get through
the AHFC program if they shopped around. Mr. Kapansky
answered that if the person were a first time home-buyer or
a veteran he did not think they could find a more attractive
interest rate.
2:21:46 PM
Representative Kelly asked how the mortgage insurance
worked. Mr. Butcher said in most cases a person pays
mortgage insurance until the mortgage is 20% paid, but in
the teachers and health professionals program the mortgage
insurance is paid until 35% of the mortgage is paid, as AHFC
is taking an increased risk.
Representative Kelly wondered if the house went to another
teacher when the teacher who bought the house through the
program left. Mr. Butcher replied that the house returns to
an all-new loan. Anyone could buy the house with the normal
requirements.
2:24:33 PM
Representative Kelly wanted to know the differences between
the program covered by HB 325 and the rural program Mr.
Butcher had referred to earlier. Mr. Butcher said the two
programs were often confused with one another as they were
created at the same time. The program covered in HB 325 is
not the rural program. The rural program helps rural
communities recruit and retain teachers and health care
professionals.
Representative Kelly referred to the handout listing houses
in Aniak that were purchased through the HB 325 program
("Cumulative Purchases for Teacher/Nurse Option by
Location," On File). He thought Aniak was a rural community.
Mr. Butcher explained that the HB 325 program can be
utilized by any community in the state.
Mr. Fauske interjected that AHFC learned that even though
the HB 325 program could be used in rural communities, it
rarely was. The HB 325 program is mainly used in urban
communities. In many of rural situations, teachers and
health care professionals are itinerant. The rural program
specifically addresses grants and loans to regional housing
authorities, village corporations and school districts. That
program has been equally successful.
Representative Kelly wondered about asset quality
monitoring. He stated he supported a sunset, especially if
the category of eligible participants was broadening to
people with less income. He also wanted delinquencies
tracked.
2:28:36 PM
Vice-Chair Stoltze spoke regarding sunset length. Mr.
Butcher thought longer would be more beneficial for AHFC but
would understand if the Committee wanted a shorter sunset.
Mr. Fauske agreed that longer would be better; in terms of
market conditions he thought five to eight years would be
optimal. Mr. Kapansky agreed that five to eight would work.
Co-Chair Meyer anticipated an amendment on the subject of
sunset dates.
2:30:45 PM
Representative Crawford stated that he did not see a need
for a cap on the salary level of a program participant. He
had originally thought a cap was needed because of the
shortage of teachers and nurses. He wondered if there were
shortages in the expanded categories. Vice-Chair Stoltze
said there were shortages.
Representative Crawford said he supported the program
continuing with a sunset so that progress could be
evaluated.
Mr. Fauske added that the current accelerated value in the
real estate market makes it even more difficult for young
workers to come up with a down payment. He thought the
program has helped forestall the shortages of teachers and
health professionals in the state.
2:33:41 PM
Representative Joule commented on the situation of the
upcoming generation that cannot afford to buy a home. The
whole issue has become the down payment, often putting
parents in the position of having to pay it. He thought the
program would make a huge difference to many people and
would affect how committed they would be to a community. He
supported the bill and said he was excited it will be
expanded.
2:35:30 PM
Co-Chair Meyer opened public testimony. Seeing none, he
closed public testimony.
Representative Hawker MOVED Conceptual Amendment #1 to HB
325.
Co-Chair Meyer OBJECTED for discussion purposes.
Representative Hawker described the conceptual amendment as
putting a five-year reauthorization sunset on the bill. He
stated that in his view, the sunset is not a sunset on the
program. He intended the sunset to be a check on the
management and operations of the program.
Co-Chair Meyer WITHDREW his OBJECTION.
There being NO OBJECTION, Conceptual Amendment #1 was
adopted.
2:38:09 PM
Representative Hawker noted for the record that the fiscal
note is zero and does not require General Fund or other
expenditures.
Co-Chair Chenault MOVED to report CSHB 325 (FIN) out of
Committee with individual recommendations and with zero note
#1.
CSHB 325 (FIN) was REPORTED out of Committee with a "do
pass" recommendation and with zero note #1 by the Department
of Revenue.
2:39:29 PM AT EASE
2:39:55 PM RECONVENE
HOUSE BILL NO. 285
"An Act relating to an optional exemption from
municipal property taxes for residences of widows and
widowers of certain members of the armed forces of the
United States; and providing that this Act may be known
as the Sergeant Irving Hernandez, Jr., Act."
KAREN LIDSTER, STAFF, REPRESENTATIVE JOHN COGHILL, spoke
regarding HB 285. She explained that the bill had been
brought to Representative Coghill's office as a petition
through Fairbanks North Start Borough. The widow of a
soldier who wants to stay in the area was seeking
assistance. House Bill 285 asks for an optional exemption
from municipal property taxes for residences of widows and
widowers of certain members of the armed forces of the
United States.
Ms. Lidster referred to a sectional that shows a few of the
changes that were made in the previous committee (On File).
The specific name of the soldier was removed as well as
language limiting time. The bill as it stands gives the
municipality as much leeway as needed to decide whether to
have the exemption and to set up application standards.
2:43:12 PM
Vice-Chair Stoltze wondered about the status of "missing in
action but not declared dead" soldiers. Ms. Lidster said
that had not been discussed during the review by Military
and Veterans Affairs. Vice-Chair Stoltze voiced concerns
about whether the language was broad enough.
Representative Hawker wondered if the language
qualifications "armed forces of the United States" and
"eligible for hostile fire or imminent danger pay" include
all the people the sponsor intends to include. He asked if
there were organizations that could be perceived as not
being included. For example, would it include National Guard
units detached and serving on active duty. Ms. Lidster said
she would have that clarified.
2:47:15 PM
Representative Hawker wanted the language to include the
exact meaning and scope intended. Vice-Chair Stoltze agreed
with Representative Hawker regarding inclusiveness. He cited
an example of a group that did not achieve veteran status
until there was an act of Congress.
2:49:04 PM
Co-Chair Chenault opened public testimony.
SUSAN FERNANDEZ, SELF (TESTIFIED VIA TELECONFERENCE), spoke
in support of HB 285. Ms. Fernandez identified herself as
the widow of Sergeant Irving Hernandez, Jr., who was killed
in Iraq on July 12, 2006. She described her financial
difficulties after losing half their income. She wants to
stay in Alaska with her children.
2:51:12 PM
Co-Chair Meyer closed public testimony.
Co-Chair Chenault wondered if the bill pertains to all
military members killed in the line of duty going back to
World War II, or if there is a cut-off date. His
understanding was that the municipalities would set the
parameters regarding who would qualify.
Representative Thomas wondered if a widow would lose the
exemption through remarriage.
2:53:58 PM
REPRESENTATIVE JOHN COGHILL, SPONSOR, answered that details
could be worked out in each community. He anticipated
different communities would and should make different rules
depending on local circumstances.
Representative Thomas referred to the case of a national
guardsman who was killed in Iraq who had been living with a
woman and their children and wondered if she would also be
considered a widow. Representative Coghill answered that his
intent in the bill was that whoever is entitled to survivor
benefits under the law would be entitled to the tax
exemption. Representative Thomas thought the point should be
made on the floor.
Vice-Chair Stoltze reiterated that the program is optional.
2:56:06 PM
Co-Chair Chenault MOVED to report CSHB 285 out of Committee
with individual recommendations and accompanying fiscal note
#1. There being NO OBJECTION, it was so ordered.
CSHB 285 (CRA) was REPORTED out of Committee with a "do
pass" recommendation and with zero note #1 by the Department
of Commerce, Community and Economic Development.
2:58:07 PM
HOUSE BILL NO. 65
"An Act relating to breaches of security involving
personal information, credit report and credit score
security freezes, consumer credit monitoring, credit
accuracy, protection of social security numbers, care
of records, disposal of records, identity theft,
furnishing consumer credit header information, credit
cards, and debit cards, and to the jurisdiction of the
office of administrative hearings; amending Rule 60,
Alaska Rules of Civil Procedure; and providing for an
effective date."
Vice-Chair Stoltze MOVED to ADOPT work draft 25-LS0311\L,
Bannister, 2/4/08. There being NO OBJECTION, it was adopted.
Representative Nelson asked if the Committee would be
addressing amendments.
AT EASE: 2:59:09 PM
RECONVENE: 3:00:14 PM
3:00:17 PM
REPRESENTATIVE JOHN COGHILL, SPONSOR, provided an overview
of the working sectional for House Finance on proposed
changes to HB 65 (On File).
Title: Insert disclosure of permanent fund
dividend applicant records on line 5 after
administrative hearings.
Section 1 AS 40.21.110 Care of records - this
sets out the ownership of public records and
how they are to be managed from creation to
disposal.
Section 2 AS 43.23.017 relates to the
confidentiality of information on each
permanent fund dividend application.
Section 3 AS 43.23.017 allows disclosure of
the non-confidential applicant information to
a business that is licensed under AS
43.70.020.
Section 4 AS 44.64.030(a) adds a new
paragraph (35) AS 45.48.080(c) which is part
of the new Chapter 48 Personal Information
Protection Act.
Section 5 AS 45 is amended by adding a new
chapter Personal Information Protection Act.
This new chapter contains a total of seven
(7) Articles with individual sections.
Article 1.
Breach of Security
Involving Personal Information
Sec. 45.48.010 Disclosure of breach of
security
Describes what a covered person who owns or
[uses] licenses personal information must do
in case of a breach of information.
This change makes it clear a covered person
that owns or licenses information is
responsible for disclosure and notification
in case of a breach. Covered is described in
Sec. 45.48.090 Definitions - to bring
conformity to the meaning of person
throughout Article 1.
Sec. 45.48.020 Allowable delay in
notification
Describes reasons for delaying notification
of a breach of information.
Sec. 45.48.030 Methods of notice
Describes the methods to be used to notify a
person that there has been a breach of
information. Lists exceptions to the methods
of notification relating to cost and number
of consumers to be notified.
Sec. 45.48.040 Notification of certain other
agencies
Describes when it is necessary to notify
other consumer reporting agencies about a
breach. There are exceptions to these
requirements are also set out.
Sec. 45.48.050 Exception for employees and
agents
Lists exceptions for acquisition of personal
information by an employee or agent of an
information collector.
Sec. 45.48.060 Waivers
No waivers of these sections are allowed.
Sec. 45.48.070 Treatment of certain breaches
A breach of information by an information
recipient must be reported to the information
distributor so they can comply with the
notification requirements if the breach
occurred to an information system maintained
by the information distributor.
Sec. 45.48.080 Violations
Sets out fines for violations of 45.48.010-
45.48.090 by a governmental agency that is an
information collector, and information
collectors who are not governmental agencies.
Defines "governmental agency".
Sec. 45.48.090 Definitions
Defines the following terms:
(1)breach of the security;
(2) ["information collector"]
is replaced with: "covered person"
means a
(A) person doing business;
(B) a governmental agency; or
(C) a person with more than 10 employees
This new subsection (2) describes "covered
person" and replaces information collector
throughout Article l.
(3) "governmental agency" means a state or
local governmental agency, except for an
agency of the judicial branch.
New definition because "governmental agency"
is included in "covered person" it needs to
be defined.
(4) "information collector" means a covered
person who owns or licenses personal
information in any form if the personal
information includes personal information on
a state resident.
Changes in definition of "information
collector" include "covered person" which is
described in (2) above.
New subsection:
(7) "personal information"
Page 7, Line 23: Delete [address, or
telephone number] after individuals name.
Address and telephone number are deleted
because this information is readily available
in public records.
Page 7, Line 31 to
Page 8, Lines 1 - 7 Add (iii) except as
provided in (iv) of this subparagraph, the
individual's account number, credit card
number, or debit card number;
(iv) if an account can only be accessed with
a personal code, the number in (iii) of this
subparagraph and the personal code; in this
sub-subparagraph, "personal code" means a
security code, an access code, a personal
identification number, or a passwork;
(v) passwords, personal identification
numbers, or other access codes for financial
accounts.
These changes were made to make it clear what
information and combinations of information
is considered personal information. The
combination of numbers, codes, cards, etc. if
breached would be cause for notification to
an individual. Adding in access codes and
PIN numbers, tightened down the requirement
on information breach notification
requirements.
Article 2.
Credit Report
and Credit Score Security Freeze
Sec. 45.48.100 Security freeze authorized
Rights of consumers to prohibit release of
their personal information.
Sec. 45.48.110 Placement of security freeze
(a)(1) by [certified] mail
Sets out procedures for a consumer to request
a consumer credit reporting agency to freeze
their information.
Page 8, Line 15 Remove requirement that
request for freeze be made by certified mail.
Sec. 45.48.120 Confirmation of security
freeze
Describes the responsibility of the consumer
credit reporting agency to notify the
consumer when a security freeze has been
placed.
Sec. 45.48.130 Access and actions during
security freeze
Describes how a consumer can allow access to
their information by a third party when a
security freeze is in place; timeframe for
the consumer credit reporting agency to
respond, how an insurer is to treat a
consumer's application if a security freeze
prevents access to the consumer's
information, and what changes are allowed
when a security freeze is in place, and
notification requirements. Defines "official
information" and "technical change".
Page 9, Line 27, 28 (d) [immediately] to 15
minutes;
Change from immediately to 15 minutes was a
more reasonable response time.
Sec. 45.48.140 Removal of security freeze
Sets out procedure for removing a security
freeze, how the request for the freeze is to
be made, how the consumer credit reporting
agency shall respond, and what identifiers
are necessary to remove the freeze.
Page 11, Line 22 (b) [immediately] to within
three days.
Change from immediately to within three days
was a more reasonable response time.
Sec. 45.48.150 Prohibition
Sets out guidelines for reporting to third
parties when a security freeze is in place.
Sec. 45.48.160 Charges
Charges to a consumer regarding security
freezes.
Sec. 45.48.170 Notice of rights
Additional notices to be given when a
consumer is provided a summary of rights
under the Fair Credit Reporting Act (FCRA).
Caution is given that a security freeze may
prohibit the timely approval of subsequent
requests or transactions.
Page 13, [rental housing, employment, an
investment, a license, a digital signature]
Page 14, Line 17 Internet credit card
[transaction] application, an extension of
credit at point of sale, and other items and
services.
Specific items were deleted because they are
exceptions to a security freeze in other
sections. Application was substituted for
transaction for clarification that a freeze
does not stop a person from making purchases
with their card.
This section also advises the individual that
there may be charges for lifting a freeze
after the person has used their two free
lifts.
Page 14 - Lines 9 - 11 [Under some
circumstances] After the first two requests
in a year the consumer credit reporting
agency may charge you $2 to temporarily lift
the freeze. This change lets an individual
know that the CRA may charge $2 to lift a
freeze after the 2 free lifts. Deleted
"Under some circumstances to remove ambiguity
of when the charges might be applied, but
gives the CRA some latitude as to whether or
not they want to charge for additional lifts.
Sec. 45.48.180 Notification after violation
Describes the notice required if a consumer
credit reporting agency violates a security
freeze. The timeframe to report the violation
is within five business days after:
Page 14, Line 28 insert discovering the
release.
Inserted the word discovering for
clarification that a violation may have
occurred but until it is discovered he CRA
can not be expected to give notice.
Sec. 45.48.190 Resellers
Requires that a consumer credit reporting
agency acting as a reseller honor a security
freeze that is placed by another consumer
reporting agency.
Sec. 45.48.200 Violations and penalties
Describes the rights of a consumer who
suffers damages as a result of a breach of
their personal information.
Page 15, Lines 7 - 10 [actual damages,
including loss of wages, and when applicable,
damages for pain and suffering;] may recover
actual economic damages, court costs allowed
by the rules of court, and full reasonable
attorney fees.
These changes reflect the penalties allowed
throughout the Act. The individual has the
right to recover actual economic damages,
court costs and attorney fees.
Sec. 45.48.210 Exemptions
Lists exemptions to the use of credit
information when a security freeze is in
place. The exceptions in
Page 16, Line 26 (b) do not apply to a person
[who acts] when acting only as a reseller of
consumer information.
A person may wear many "information" hats.
This change makes it clear that exemptions do
not apply when a person is acting as a
reseller, which is narrower than who acts.
Sec. 45.48.290 Definitions
Defines the following terms: account review;
consumer; consumer credit reporting agency;
reseller of consumer information; security
freeze; third party.
Article 3.
Protection of Social Security Number
Sec. 45.48.400 Use of social security number
Sets out guidelines for handling a person's
social security number.
Sec. 45.48.410 Request and collection
Sets out prohibitions and exemptions for
requesting or collecting an individual's
social security number.
(b)(1) if the person is expressly authorized
by local, state, or federal law, including a
regulation adopted under AS 45.48.470, to
demand proof of the individual's social
Security number, to
Page 18, Line 26 request or collect the
individual's social security number
(5) if the request or collection is for a
background check on the individual, law
enforcement
Page 19, Line 12 or other government purposes
or the individual's
(6) if the
Page 19, Line 14 [disclosure] request or
collection does not have independent economic
value,
The changes shown above protect those
individuals required to collect a social
security number. Disclosure is deleted as
this section is not dealing with disclosure
of SSN.
Sec. 45.48.420 Sale, lease, loan, trade, or
rental
Prohibitions and exemptions regarding third
party use of social security numbers.
Page 19, Lines 27 - 29 (c) Nothing in this
section prevents a business from transferring
social security numbers to another person if
the transfer is part of the sale or other
transfer of the business to the other person.
This new subsection allows the sale or
transfer of a business that owns or possesses
social security numbers.
Sec. 45.48.430 Disclosure
Prohibitions and exemptions regarding
disclosure of social security numbers to
third parties.
(b)(5) the disclosure is for a background
check on the individual, law enforcement
Page 20, Line 21 or other government purposes
or the individual's employment, including
employment benefits.
Or other government is included for
consistency with Sec. 45.48.410 and for
protection when performing duties that
include disclosure.
Sec. 45.48.440 Interagency disclosure
Describes when and to whom disclosure is
authorized.
Sec. 45.48.450 Exception for employees,
agents, & independent contractors
Describes when and to whom disclosure is
authorized.
Sec. 45.48.460 Employment-related exception
Describes when use of a social security
number should not be restricted.
Sec. 45.48.470 Agency regulations
Procedures for adopting regulations necessary
for a state agency to carry out their duties
and responsibilities.
Sec. 45.48.480 Penalties
Rights of the state and individuals against
persons that knowingly violate these sections
and what damages and attorney fees may be
recovered. For consistence with other
sections that deal with penalties - insert
Page 22, Line 4 economic after actual.
Article 4.
Disposal of Records
Sec. 45.48.500 Disposal of records
This sets out the measures to be followed
when disposing of records which contain
personal information.
Sec. 45.48.510 Measures to protect access.
Describes the measures that may be taken to
comply with Sec. 45.48.500 (above).
Sec. 45.48.520 Due diligence
Lists procedures that if performed show due
diligence.
Sec. 45.48.530 Policy and procedures
A business or governmental agency shall adopt
written policies and procedures relating to
records disposal.
Sec. 45.48.540 Exemptions
Compliance to these sections is not required
if a government agency or business is
required by federal law to act in another
way, or the business is subject to and in
compliance with GLBA, or FCRA.
Sec. 45.48.550 Civil penalty
Liability to the state by an individual,
business, or governmental agency for
violations of these sections.
Sec. 45.48.560 Court action
Page 24, Lines 1 - 4 actual economic damages
court costs allowed by the rules of court,
and full reasonable attorney fees.
These changes are made to this section
consistent with court actions and penalties
throughout the Act.
Sec. 45.48.590 Definitions
Defines the following terms: business;
conducts business; possesses; dispose;
governmental agency; personal information;
records.
(4) "personal information" means
Page 25, Line 2 (B)(i) name, [address, or
telephone number] and.
This change will make the definition of
"personal information" consistent by removing
address and telephone number.
Article 5.
Factual Declaration of Innocence
after Identify Theft,
Right to file Police Report
Regarding Identity Theft
Sec. 45.48.600 Factual declaration of
innocence after identity theft
Describes the conditions that should exist in
order for an individual to petition the
superior court for a determination of
innocence of a crime involving the theft of
their identity.
Sec. 45.48.610 Basis for determination
Lists the type of information that may be
made part of the record for the court to make
a determination of factual innocence.
Sec. 45.48.620 Criteria for determination;
court order
Sets the criteria that the court may use to
determine a victim's factual innocence.
Sec. 45.48.630 Orders regarding records
Describes what the court may order regarding
the disposition of incorrect records
regarding a victim of identity theft.
Sec. 45.48.640 Vacation of determination
States that a court order may be vacated if
there has been a misrepresentation of the
material.
Sec. 45.48.650 Court form
Development of a form to be used under
45.48.620
Sec. 45.48.660 Data base
This section allows the establishment and
maintenance of a data base of victims of
identity theft, and who has authorization to
the information.
Sec. 45.48.670 Toll-free telephone number
Establishes a toll-free number that accesses
the information in the data base established
in 45.48.660.
Sec. 45.48.680 Right to file police report
regarding identity theft
Sets out rights of an individual to file a
police report if they suspect they are a
victim of identity theft, and the
responsibility of a law enforcement agency to
make the report even if they do not have
jurisdiction.
Sec. 45.48.690 Definitions
Defines the following terms: crime,
department, identity theft, perpetrator, and
victim.
Article 6.
Truncation of Card Information
Sec. 45.48.750 Truncation of card information
Describes limits on a business regarding the
printing of credit or debit card numbers and
the exceptions depending on whether the
receipt is produced electronically or is
handwritten or imprinted. Sale of devices
that print more than the last four digits on
a consumer receipt for a credit or debit card
transaction is not allowed. Also sets out
civil action that an individual can take, and
civil penalty to the state. It also
describes credit, credit card, debit card,
and knowingly.
Page 28, Line 1 may recover actual economic
damages, [or $5,000, which ever is greater]
These changes keep the civil action damages
consistent throughout the Act.
Article 7.
General Provisions
Sec. 45.48.990 Definitions
Provides definitions of terms.
Sec. 45.48.995 Short Title
Alaska Personal Information Protection Act.
Page 29, Line 17 deleted AS 45.48.750 is
amended by adding a new subsection (f).
This subsection was included in Article 6
Truncation of Card Information - Page 27,
Lines 28-30, subsection (c).
New Section 6
Page 29, Lines 17 - 24 AS 45.50.471(b) is
amended by adding a new paragraph (53) (A)
and (B).
Section 7 The uncodified law of the State of
Alaska is amended by adding a new section to
read:
INDIRECT COURT RULE AMENDMENTS
(a) AS 45.48.640 changes Rule 60(b) Rules of
Civil Procedure effecting AS 45.48.640.
(b) AS 45.48.640(b) changes Rule 82, Rules
of Civil Procedure effecting
AS 45.48.480(b).
NEW SECTION:
Section 8 - TRANSITION: REGULATIONS. A state
agency may proceed to adopt regulations
necessary to implement this Act. The
regulations take effect under AS 44.62
(Administrative Procedure Act), but not
before the effective date of the law
implemented by the regulation.
Section 9 AS 45.48.470 enacted by Sec. 5 of
this Act; takes effect immediately under AS
01.10.070(c).
Section 10 Section 8 of this Act takes effect
immediately under AS 01.10.070(c).
Section 11 Except as provided by secs. 9 - 10
of this Act, this Act takes effect January 1,
2009.
3:19:22 PM
Representative Coghill noted that the bill's sponsors had
worked with State agencies regarding penalties and
provisions, and have strongly encouraged the agencies to
protect information. He acknowledged that many procedures
have already changed.
3:22:30 PM
Co-Chair Meyer said there were amendments to the bill that
would be proposed. He asked if there were questions based
on the changes proposed in the working sectional.
Representative Hawker commented that a number of his
previous concerns had been addressed. He wondered if
consensus had been reached regarding the whole.
3:23:48 PM
Representative Coghill thought that aside from policy calls
that he could not agree with, most concerns had been
addressed. He pointed out that the bill proposes a SSN
protection scheme that is probably the toughest in the
nation and he thought there would be some opposition. As far
as the freeze goes, the bill is well within national limits.
Truncation is less of an issue. He listed some of the
problems insurance companies and doctors had with the bill
and added that those problems are connected with billing
issues and not identification purposes.
Representative Hawker wondered if all of his concerns
related to notification by email had been addressed.
3:26:30 PM
Representative Coghill responded that the sponsors thought
mail would be the best form of notification. He thought
there might be some discussion about whether the protection
requirement should apply to both paper and electronic
records.
Representative Gara said the issue of the form of
notification is addressed by the bill. When a company has
personal financial information that is accidently released
to the public, if a very large number of people are
affected, the company can notify by email. If the number of
people affected is a smaller number, the company has to send
a letter.
Representative Hawker said he was comfortable with the
approach.
3:29:08 PM
HB 65 was heard and HELD in Committee for further
consideration.
ADJOURNMENT
The meeting was adjourned at 3:29 PM.
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