Legislature(1995 - 1996)

02/13/1995 01:35 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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                     HOUSE FINANCE COMMITTEE                                   
                        February 13, 1995                                      
                            1:30 P.M.                                          
                                                                               
  TAPE HFC 95-20, Side 2, #000 - end.                                          
  TAPE HFC 95-21, Side 1, #000 - 347.                                          
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair  Mark Hanley  called  the  House Finance  Committee                 
  meeting to order at 1:35 p.m.                                                
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Hanley               Representative Kohring                         
  Co-Chair Foster               Representative Martin                          
  Representative Mulder         Representative Navarre                         
  Representative Brown          Representative Parnell                         
  Representative Grussendorf    Representative Therriault                      
  Representative Kelly                                                         
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Representative Scott Ogan; Karl Luck, Director, Occupational                 
  Licensing, Department of  Commerce and Economic Development;                 
  Jeff Logan, Staff, House Resources  Committee; Neil Webster,                 
  Alaska   Professional   Hunters   Association;  Susan   Cox,                 
  Assistant   Attorney  General,   Department   of  Law;   Joe                 
  McCormick,  Executive   Director,  Postsecondary   Education                 
  Commission;                                                                  
                                                                               
                                                                               
  SUMMARY                                                                      
                                                                               
  HB 19     An Act relating  to the  definition of 'fault'  as                 
            that term is used for  the purposes of determining                 
            the  liabilities  of  parties  in  civil  actions,                 
            setting  limitations  on   civil  liability,   and                 
            authorizing   the   award,  in   conformance  with                 
            applicable court rule,  of attorney fees in  civil                 
            actions."                                                          
                                                                               
            HB 19  was reported  out of Committee  with a  "do                 
            pass"  recommendation  and  with  two zero  fiscal                 
            notes by the  Department of  Law, date 2/8/95  and                 
            the  Department  of Administration,  dated 2/8/95;                 
            and with the House Judiciary Letter of Intent.                     
                                                                               
  HB 102    An Act extending  the termination date of  the Big                 
            Game Commercial Services Board."                                   
                                                                               
                                1                                              
                                                                               
                                                                               
            HB 102  was reported out  of Committee with  a "do                 
            pass" recommendation and with a fiscal impact note                 
            by  the  Department   of  Commerce  and   Economic                 
            Development, dated 2/8/95.                                         
                                                                               
  HB 135    An Act relating  to student  loans; and  providing                 
            for an effective date."                                            
                                                                               
            CSHB 135 (FIN) was reported  out of Committee with                 
            a "do pass" recommendation and  with a zero fiscal                 
            note by the Department of Education, dated 2/8/95.                 
                                                                               
  HJR 29    Relating to the federal balanced budget amendment.                 
                                                                               
            CS HJR 19 (FIN) was reported out of Committee with                 
            a "do pass" recommendation and  with a zero fiscal                 
            note by the Office of the Governor.                                
                                                                               
  Co-Chair Hanley informed  members of his intention  to waive                 
  HB 120 from Committee,  on February 15, 1995.   Members were                 
  advised to  notify him of any concerns  or objections before                 
  Wednesday.                                                                   
  HOUSE JOINT RESOLUTION NO. 29                                                
                                                                               
       Relating to the federal balanced budget amendment.                      
                                                                               
  Representative Parnell, the sponsor of  HJR 29, spoke in its                 
  support.  He observed that HJR  29 urges Congress to support                 
  and pass  a resolution proposing a  constitutional amendment                 
  requiring a federal  balanced budget.   He noted that absent                 
  policy  changes,  entitlement  and  interest  spending  will                 
  consume almost all  federal revenues in  the year 2010.   In                 
  the  year  2030,  federal  revenues   will  not  even  cover                 
  entitlement spending.  He noted that the United States House                 
  of   Representatives  passed  HJR   1,  a   balanced  budget                 
  amendment.                                                                   
                                                                               
  Representative  Brown  provided  members  with  Amendment  1                 
  (Attachment   1).    Representative  Brown  MOVED  to  adopt                 
  Amendment 1.   Amendment 1  would insert after  "WHEREAS" on                 
  page 1,  line 7,  "the goal  of."   "Could be  accomplished"                 
  would also be deleted on page 1, line 8 after "spending" and                 
  "may be advanced" would be inserted.  Representative Parnell                 
  had no objections.   There being  NO OBJECTION, Amendment  1                 
  was adopted.                                                                 
                                                                               
  Representative  Brown  provided  members  with  Amendment  2                 
  (Attachment 2).   Amendment 2 would insert after "budget" on                 
  page 1, line 12, "with provisions that will allow a response                 
  to national economic  emergencies and long-term  investments                 
                                                                               
                                2                                              
                                                                               
                                                                               
  in national infrastructure."                                                 
                                                                               
  Representative  Brown  MOVED  to  adopt  Amendment 2.    She                 
  explained that  Amendment 2 would  allow capital improvement                 
  expenditures to be accounted for separately.  Representative                 
  Mulder OBJECTED.   He stated that the  amendment would "open                 
  the door a crack".                                                           
                                                                               
  Representative Parnell  objected  to the  amendment  on  the                 
  basis that the amendment would make HJR 29 too specific.  He                 
  emphasized  that  HJR  1, introduced  in  the  United States                 
  Congress, provides that  total outlays  for any fiscal  year                 
  shall not  exceed total receipts for the  fiscal year unless                 
  three-fifths of the whole  number of each House in  Congress                 
  shall provide by  law for  a specific excess.   He  asserted                 
  that the breadth  of the  HJR 1 already  allows response  to                 
  national economic  emergencies and long-term  investments in                 
  national   infrastructure  upon   a  three-fifths   vote  of                 
  Congress.                                                                    
                                                                               
  Representative Grussendorf spoke in support  of Amendment 2.                 
                                                                               
                                                                               
  Representative Brown accentuated that the amendment would be                 
  compatible  with  HJR 1.   She  stressed that  the amendment                 
  would send  the message  that the  State of  Alaska wants  a                 
  solution that will respond to the needs of our state.                        
                                                                               
  A roll call vote was  taken on the MOTION to move  Amendment                 
  2.                                                                           
                                                                               
  IN FAVOR: Brown, Grussendorf                                                 
  OPPOSED:  Kelly, Kohring, Martin,  Mulder, Parnell,  Foster,                 
  Hanley                                                                       
                                                                               
  The MOTION FAILED (2-8).                                                     
                                                                               
  Representative  Brown referred  to  remarks  by Senator  Ted                 
  Stevens made on  the floor  of the United  States Senate  on                 
  February 25, 1994 (Attachment 3).   She noted that he stated                 
  that:   "I think it  will be a  total, total disaster  for a                 
  state  such  as  mine  to   come  under  a  balanced  budget                 
  amendment.    We  will lose  at  least  Fort Richardson  and                 
  Eielson Air Force  Base, and maybe  one other.  Alaska  will                 
  lose 94,000  jobs; there  will be 24  percent less  personal                 
  income in Alaska; the rate of unemployment, which is already                 
  the Nation's  highest, will increase  by 6.4 percent."   She                 
  observed that Senator Stevens, in his speech, detailed other                 
  effects the balanced budget amendment  would have on Alaska.                 
  Senator Stevens concluded that "this  is the wrong amendment                 
  at  the   wrong  time   to  address   the  wrong   problem."                 
  Representative Brown stressed that the effects of a balanced                 
                                                                               
                                3                                              
                                                                               
                                                                               
  budget amendment have not changed.                                           
                                                                               
  Representative   Brown   acknowledged    the   philosophical                 
  correctness of  helping Congress to  restrain its  spending.                 
  She  questioned  what  will  happen  to  Alaska  if  federal                 
  contraction   occurs  when   state  dollars   available  for                 
  expenditure are also being reduced.                                          
                                                                               
  Representative  Therriault  stressed  that Senator  Stevens'                 
  change of heart  in regards to the balanced budget amendment                 
  was based  on the  fact that  the national  situation is  so                 
  severe  that  something  absolutely  has  to  be done.    He                 
  highlighted that everybody feels there is a problem, but  no                 
  one wants to give anything up or have the programs that they                 
  have  come   to  rely   on  considered   for  reduction   or                 
  elimination.  He asserted that the State of Alaska cannot be                 
  separated from the Nation.                                                   
                                                                               
  Representative  Grussendorf  emphasized  the  importance  of                 
  federal  funding to  the  State of  Alaska.   He  questioned                 
  members' priorities: "The economy of the State of Alaska" or                 
  "do we want to have a nation wide perspective."                              
                                                                               
  Co-Chair  Hanley concluded  that  the  Nation's credit  card                 
  balance has reached  its limit.   He  emphasized that  tough                 
  decisions need to be made.  He expounded that inaction could                 
  result  in  a  worst scenario,  in  terms  of  the kinds  of                 
  reductions that  would have to  be made  in the future.   He                 
  reiterated that  the three-fifths  vote allows  flexibility.                 
  He  asserted  that a  balanced  budget amendment  will focus                 
  public pressure.                                                             
                                                                               
  Representative  Martin avouched  that calamity  will be  the                 
  result of inaction.   He stressed:  "Either pay the  bill or                 
  let your grandchildren pay it." He  asserted that we have to                 
  "get control of this wild spending in Congress."                             
                                                                               
  Representative Mulder MOVED to report  CSHJR 29 (FIN) out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.  There being NO OBJECTION, it  was                 
  so ordered.                                                                  
                                                                               
  CS HJR  19 (FIN)  was reported out  of Committee with  a "do                 
  pass"  recommendation and  with  a zero  fiscal note  by the                 
  Office of the Governor.                                                      
                                                                               
  HB  19  was  reported out  of  Committee  with  a "do  pass"                 
  recommendation  and  with  two  zero  fiscal  notes  by  the                 
  Department  of  Law,  date  2/8/95  and  the  Department  of                 
  Administration, dated 2/8/95.                                                
  HOUSE BILL NO. 102                                                           
                                                                               
                                4                                              
                                                                               
                                                                               
       "An Act extending the termination  date of the Big Game                 
       Commercial Services Board."                                             
                                                                               
  JEFF LOGAN,  STAFF, HOUSE  RESOURCES COMMITTEE  testified in                 
  support of HB 102.  He observed that HB 102 extends  the Big                 
  Game Commercial Services Board whose duties are set forth in                 
  AS 08.54.300 -  330.  He  noted that the Board  replaced the                 
  Big Game Guide  Board as a  result of legislation passed  in                 
  1989 (HB 112).   The Board is the product of the Legislative                 
  Task Force  on Guiding  and Game  which was  commissioned to                 
  resolve conflicts between guides and  outfitters.  The Board                 
  is mandated to  terminate its operation  one year after  its                 
  sunset  date.    He explained  that  unless  the Legislature                 
  passes HB 102 this session the Board will be terminated.                     
                                                                               
  REPRESENTATIVE SCOTT OGAN  testified in  support of HB  102.                 
  He noted that he served two years on the Big Game Commercial                 
  Services  Board.   He noted  that the  Alaska  Supreme Court                 
  determined  that  exclusive  use  of   guide  use  areas  is                 
  unconstitutional  under  the Common  Use  Clause.   Statutes                 
  implemented by the Board restrict guides to three Guide  Use                 
  Areas.  Any  guide can register for any area for a period of                 
  five years.   At  the end of  five years  the guide  can re-                 
  register into another  area.  He  asserted that the lack  of                 
  control  and  chaos  that  would  result  from  the  Board's                 
  termination would be detrimental to the industry.                            
                                                                               
  Representative Mulder asked  why the Board was  not extended                 
  beyond  one  year  during  the  last   legislative  session.                 
  Representative Ogan did not know.                                            
                                                                               
  Representative Martin  asked if  the statutes  pertaining to                 
  the Board's powers or duties  were repealed.  Representative                 
  Ogan replied that the statutes were not changed.                             
                                                                               
  Representative Ogan emphasized that the  Board takes in more                 
  than  it costs  to run.   He added  that the Board  plans to                 
  lower fees.  He stressed that the Board pursues violators.                   
                                                                               
  Representative Martin expressed  concern that fees  might be                 
  lowered.    He questioned  the  benefit,  to the  State,  of                 
  harvesting the resource. Representative  Ogan clarified that                 
  the license fee would be lowered.  Out-of-state tag fees are                 
  not controlled by the Board.                                                 
                                                                               
  NEIL WEBSTER, GUIDE testified via the teleconference network                 
  from Anchorage.   He testified that the  changes implemented                 
  by the  Board have  allowed him  to become  involved in  the                 
  guide industry.   He spoke  in support of  retention of  the                 
  Board.  He maintained that the Board has been a gain for the                 
  overall  industry.   He  noted  that the  current regulation                 
                                                                               
                                5                                              
                                                                               
                                                                               
  allows him to know what guides  are using the areas adjacent                 
  to the Guide Use Area he is operating in.                                    
                                                                               
  In response  to a  question by  Representative Kohring,  Mr.                 
  Logan explained  that the revenue fluctuations  indicated in                 
  the fiscal note reflect a two year licensing renewal of some                 
  licenses.                                                                    
                                                                               
  KARL LUCK,  DIRECTOR, OCCUPATIONAL LICENSING,  DEPARTMENT OF                 
  COMMERCE AND ECONOMIC DEVELOPMENT clarified that funding was                 
  not reduced for  the Board in FY  95.  He stressed  that the                 
  Board's responsibilities have not been reduced.  Funding for                 
  the Board  was included in  the FY 96  proposed budget.   He                 
  further clarified that revenue reflected  in the fiscal note                 
  is  all general  fund  program receipts.    The fiscal  note                 
  reflects that there  are greater  program receipts in  years                 
  that  the  two  year  licenses  are  renewed.   The  program                 
  receipts are added over the two year period and then divided                 
  in half to derive the Board's yearly budget.  He  noted that                 
  there  is  a $10.0  thousand  dollar  increase in  FY  97 to                 
  accomplish a new statutory mandate.                                          
                                                                               
  Representative   Brown  asked  if   AS  08.54310  (b)(1)  is                 
  constitutional.  Mr.  Luck acknowledged that the  statute is                 
  being challenged in Superior Court.  Representative  Navarre                 
  assured her that the  law will be found constitutional.   He                 
  emphasized, as a former member of the Legislative Task Force                 
  on Guiding and  Game, that the  legislation was designed  to                 
  allow access.                                                                
                                                                               
  Representative Therriault  cautioned that the Board  will be                 
  asked to absorb the  $10.0 thousand dollar increase from  FY                 
  96 to  FY  97.   He  observed that  there  is also  a  $30.0                 
  thousand dollar increase  from FY  95 to  FY 96.   Mr.  Luck                 
  noted that  the  Board  is  required by  statute  to  charge                 
  licensing fees that  are approximately equal to the  cost of                 
  regulating the Board.   He emphasized that the amount needed                 
  to run the Board depends on the number of licenses obtained.                 
                                                                               
                                                                               
  Mr.  Luck reviewed  personal services  costs.  There  is one                 
  range  12  licensing examiner  position  which  is dedicated                 
  solely  to  the  Board.   One  range  12 licensing  examiner                 
  position has  some of its  time dedicated  to other  boards.                 
  Positive time keeping  is used to  allocate the cost of  the                 
  position to whichever board worked for at a particular time.                 
  He added that services provided by the Hearing Officer Unit,                 
  Investigative  Unit,  and  any  clerical  support  are  also                 
  charged  through  positive  time  keeping.    There  is  one                 
  investigator  position  which  works solely  on  the Board's                 
  investigations.                                                              
                                                                               
                                                                               
                                6                                              
                                                                               
                                                                               
  (Tape Change, HFC 95-21, Side 1)                                             
                                                                               
  Representative  Mulder  MOVED  to  report   HB  102  out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.                                                    
                                                                               
  HB  102  was reported  out  of  Committee with  a  "do pass"                 
  recommendation  and  with  a  fiscal   impact  note  by  the                 
  Department  of  Commerce  and  Economic  Development,  dated                 
  2/8/95.                                                                      
  HOUSE BILL NO. 19                                                            
                                                                               
       "An Act relating to  the definition of 'fault' as  that                 
       term  is  used  for  the  purposes of  determining  the                 
       liabilities  of  parties  in   civil  actions,  setting                 
       limitations  on civil  liability,  and authorizing  the                 
       award, in  conformance with applicable  court rule,  of                 
       attorney fees in civil actions."                                        
                                                                               
  Representative Therriault, sponsor  of HB  19, gave a  brief                 
  overview of the legislation.  He noted that the  legislation                 
  is  intended  to  clarify civil  liability  law  that allows                 
  defendants to  argue that they  are not liable  for offenses                 
  they have  committed intentionally.   The  need arises  from                 
  Alaska  court  cases in  which  defendants have  argued that                 
  because the law refers  only to acts that are  "negligent or                 
  reckless"   and   not   specifically   to  acts   that   are                 
  "intentional," it does  not allow  for the apportionment  of                 
  fault  of those who  have committed  offenses intentionally.                 
  In cases in  which more than  one person contributes to  the                 
  injuries, the law is unclear as to whether or not the person                 
  who  committed   an  offense   intentionally  can   be  held                 
  responsible for any of the fault.   To date, cases utilizing                 
  this argument  have been  found to  be without  merit.   The                 
  legislation  would  eliminate  the  need  for  costly  court                 
  proceedings.                                                                 
                                                                               
  Representative Therriault observed  that the House Judiciary                 
  Committee  adopted  a  Letter of  Intent  with  HB  19.   He                 
  asserted   that  the   legislation   reflects  the   court's                 
  determination in an attempt to clarify the law.                              
                                                                               
  Representative Therriault pointed out that in some cases the                 
  plaintiffs are  using the  same argument in  order to  bring                 
  their case against the person or entity that can best afford                 
  the  recovery.    He used  the  example  of  a current  case                 
  involving a mail bomb.  The plaintiffs are claiming that the                 
  State is negligent in preventing  the defendant from sending                 
  the bomb.  If the intentional tortfeasor is excluded all the                 
  blame can be placed on the "deep pocket" of the State.                       
                                                                               
                                                                               
                                7                                              
                                                                               
                                                                               
  SUSAN  COX, ASSISTANT  ATTORNEY GENERAL,  DEPARTMENT  OF LAW                 
  testified that the legislation will  clarify current law and                 
  close a  loop hole.  She added that  the Letter of Intent by                 
  the House Resources Committee accomplishes its intent.                       
                                                                               
  Representative  Therriault stated  that the  House Judiciary                 
  Committee  wanted  to  clarify that  all  parties  would not                 
  necessarily be on the "same playing  field."  The courts are                 
  not precluded from finding that the intentional party should                 
  bear one hundred percent of the fault.                                       
                                                                               
  Representative  Therriault  MOVED  to report  HB  19  out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying  fiscal   notes   and   the   House   Judiciary                 
  Committee's Letter of Intent.   There being NO OBJECTION, it                 
  was so ordered.                                                              
                                                                               
  HB  19  was  reported out  of  Committee  with  a "do  pass"                 
  recommendation  and  with  two  zero  fiscal  notes  by  the                 
  Department  of  Law,  date  2/8/95  and  the  Department  of                 
  Administration, dated 2/8/95;  and with the House  Judiciary                 
  Letter of Intent.                                                            
  HOUSE BILL NO. 135                                                           
                                                                               
       "An Act relating to student loans; and providing for an                 
       effective date."                                                        
                                                                               
  Representative  Brown  provided  members  with  Amendment  1                 
  (Attachment 4).   Amendment 1  deletes "relating to  student                 
  loans"  from  the  title and  adds  "authorizing  the Alaska                 
  Commission on  Postsecondary Education to  adopt regulations                 
  necessary to determine  and set an interest  rate applicable                 
  to a student loan  for which money is disbursed on  or after                 
  July 1, 1995, and regulations necessary to implement certain                 
  loan default  sanctions and consolidation of loan provisions                 
  beginning July 1, 1995."                                                     
                                                                               
  JOE MCCORMICK, EXECUTIVE  DIRECTOR, POSTSECONDARY  EDUCATION                 
  COMMISSION  testified in  support of HB  135.   He explained                 
  that it provides  transition language  which will allow  the                 
  Commission to implement the provisions of HB 506, which were                 
  passed  by  the previous  legislature.   He  noted  that the                 
  transition language  which normally  accompanies a  statute,                 
  was inadvertently left out of HB 506.  The Department of Law                 
  notified the  Commission of  the problem  in November  1994.                 
  The  Department  of Law  advised  that  HB 135  needs  to be                 
  adopted before  the Commission  can  propose regulations  to                 
  implement HB 506 by July 1, 1995.  He emphasized that HB 506                 
  set forth a new method of calculating the interest in Alaska                 
  student loans, effective  July 1, 1995.   If regulations are                 
  not implemented before July 1, 1995 the Commission will have                 
                                                                               
                                8                                              
                                                                               
                                                                               
  13,000 loans that will not be dispersed.                                     
                                                                               
  Representative Martin  recalled that teachers  were excluded                 
  from the provisions of HB 506.                                               
                                                                               
  Mr.   Luck   agreed   that  section   2   would   allow  the                 
  implementation of provisions passed in  HB 506 which exclude                 
  teachers.  He observed it would not prevent  initial license                 
  holders to conduct their business.  Renewals would be denied                 
  if the holder's student  loan payments are not current.   If                 
  section 2  is not  adopted the  Commission would  be out  of                 
  compliance with the law.                                                     
                                                                               
  Co-Chair  Hanley MOVED  to adopt  Amendment 1, on  behalf of                 
  Representative Brown.   There being NO OBJECTION,  it was so                 
  ordered.                                                                     
                                                                               
  Representative  Navarre  MOVED  to report  CSHB  135  out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal notes.                                                   
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 2:39 p.m.                                           
                                                                               
                                                                               
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