Legislature(2011 - 2012)HOUSE FINANCE 519

03/20/2012 01:30 PM FINANCE


Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 221 PUBLIC DEFENDER APPOINTMENT PROCEDURES TELECONFERENCED
<Bill Hearing Canceled>
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 196 BULK FUEL LOANS/POWER PROJECT FUND TELECONFERENCED
Moved CSHB 196(FIN) Out of Committee
+= HB 261 COMMERCIAL FISHING ENTRY PERMIT LOANS TELECONFERENCED
Moved CSHB 261(FIN) Out of Committee
+= HB 337 BD OF ARCHITECTS, ENGINEERS, SURVEYORS TELECONFERENCED
Moved Out of Committee
+= HB 358 ANWR ADVERTISING CONTRACT TELECONFERENCED
Moved CSHB 358(FIN) Out of Committee
                  HOUSE FINANCE COMMITTEE                                                                                       
                      March 20, 2012                                                                                            
                         1:39 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:39:35 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stoltze called the  House Finance Committee meeting                                                                    
to order at 1:39 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Bill Thomas Jr., Co-Chair                                                                                        
Representative Anna Fairclough, Vice-Chair                                                                                      
Representative Mia Costello                                                                                                     
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative David Guttenberg                                                                                                 
Representative Reggie Joule                                                                                                     
Representative Mark Neuman                                                                                                      
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Mike Doogan                                                                                                      
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Joe Michel, Staff, Representative  Bill Stoltze; David Teal,                                                                    
Director,  Legislative  Finance   Division;  Timothy  Clark,                                                                    
Staff,  Representative  Bryce Edgmon;  Representative  Lance                                                                    
Pruitt,  Sponsor; Dirk  Craft,  Staff, Representative  Lance                                                                    
Pruitt; Lynette  Bergh, Staff, Representative  Thompson; Don                                                                    
Habegar, Director,  Division of Corporations,  Business, and                                                                    
Professional  Licensing, Department  of Commerce,  Community                                                                    
and Economic Development.                                                                                                       
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Boyd Brownfield,  Self, Anchorage; Harley  Hightower, Chair,                                                                    
Board of  Registration for  Architects, Engineers,  and Land                                                                    
Surveyors, Anchorage.                                                                                                           
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 196    BULK FUEL LOANS/POWER PROJECT FUND                                                                                    
                                                                                                                                
          CSHB 196(FIN)  was REPORTED out of  committee with                                                                    
          a  "do pass"  recommendation  and  with three  new                                                                    
          fiscal   impact  notes   by   the  House   Finance                                                                    
          Committee   for   the  Department   of   Commerce,                                                                    
          Community and Economic Development.                                                                                   
                                                                                                                                
HB 261    COMMERCIAL FISHING ENTRY PERMIT LOANS                                                                                 
                                                                                                                                
          CSHB 261(FIN)  was REPORTED out of  committee with                                                                    
          a "do  pass" recommendation and with  one new zero                                                                    
          impact  note  from  the  Department  of  Commerce,                                                                    
          Community   and  Economic   Development  and   one                                                                    
          previously published zero fiscal note: FN1 (DFG).                                                                     
                                                                                                                                
HB 337    BD OF ARCHITECTS, ENGINEERS, SURVEYORS                                                                                
                                                                                                                                
          HB 337  was REPORTED out  of committee with  a "do                                                                    
          pass"  recommendation  and   with  one  previously                                                                    
         published fiscal impact note: FN1 (CED).                                                                               
                                                                                                                                
HB 358    ANWR ADVERTISING CONTRACT                                                                                             
                                                                                                                                
          CSHB 358(FIN)  was REPORTED out of  committee with                                                                    
          a "do  pass" recommendation and with  a new fiscal                                                                    
          impact  note by  the House  Finance Committee  for                                                                    
          the   Department   of  Commerce,   Community   and                                                                    
          Economic Development.                                                                                                 
                                                                                                                                
HOUSE BILL NO. 196                                                                                                            
                                                                                                                                
     "An Act relating  to the power project fund  and to the                                                                    
     bulk  fuel revolving  loan  fund;  establishing a  bulk                                                                    
     fuel  loan  account  and  making  the  bulk  fuel  loan                                                                    
     account and the bulk  fuel bridge loan account separate                                                                    
     accounts  in   the  bulk  fuel  revolving   loan  fund;                                                                    
     providing for  technical assistance to  rural borrowers                                                                    
     under the  bulk fuel  bridge loan program;  relating to                                                                    
     the  administration and  investment  of  the bulk  fuel                                                                    
     revolving loan  fund by the division  in the Department                                                                    
     of  Commerce,   Community,  and   Economic  Development                                                                    
     responsible  for community  and  regional affairs;  and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
1:40:36 PM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough MOVED to  ADOPT the proposed committee                                                                    
substitute    for   HB    196,   Work    Draft   27-LS0529\I                                                                    
(Kirsch/Nauman, 3/20/12) as a working document.                                                                                 
                                                                                                                                
Co-Chair Stoltze OBJECTED for the purpose of discussion.                                                                        
                                                                                                                                
JOE  MICHEL, STAFF,  REPRESENTATIVE BILL  STOLTZE, explained                                                                    
the additions in  the new CS and stated that  it offered two                                                                    
changes from  the previous version, which  committee members                                                                    
had examined  earlier in the  day. He  pointed to page  7 of                                                                    
the bill and related that  the effective date was changed to                                                                    
January 1, 2013 from January 1, 2012.                                                                                           
                                                                                                                                
Co-Chair   Stoltze  inquired   why  the   date  change   was                                                                    
necessary.  Mr.  Michel  replied  that  certain  regulations                                                                    
needed  to be  adopted and  that the  additional year  would                                                                    
provide the  Department of Commerce, Community  and Economic                                                                    
Development (DCCED) with time to make the changes.                                                                              
                                                                                                                                
Co-Chair  Stoltze WITHDREW  his  OBJECTION.  There being  NO                                                                    
further OBJECTION, Work Draft 27-LS0529\I was ADOPTED.                                                                          
                                                                                                                                
REPRESENTATIVE BRYCE EDGMON, SPONSOR,  hoped that Mr. Teal's                                                                    
upcoming discussion  on the new  fiscal notes  would resolve                                                                    
concerns that the notes should  reflect the "streamlining of                                                                    
the process" that HB 196 was attempting to achieve.                                                                             
                                                                                                                                
DAVID   TEAL,   DIRECTOR,  LEGISLATIVE   FINANCE   DIVISION,                                                                    
discussed the  three fiscal  notes and  related that  he had                                                                    
been working  on the notes at  the behest of the  sponsor in                                                                    
order  to  make  them  appear  the  way  the  committee  had                                                                    
expected.  He  explained  that  the  bill  consolidated  the                                                                    
Bridge and  Bulk Fuel Loan  programs into a  single location                                                                    
and discussed  the first fiscal  note for the  Alaska Energy                                                                    
Authority  (AEA). The  AEA note  was similar  to how  it had                                                                    
originally appeared and  reflected a loss of  revenue in the                                                                    
amount of $57,000  per year because the  bill eliminated the                                                                    
application and  origination fees that were  associated with                                                                    
the loan  program; the  $57,000 would  go back  into general                                                                    
fund.  The  second change  in  the  AEA  note was  that  the                                                                    
$53,600  in  administrative  or operating  costs  that  were                                                                    
associated with  the loan program  would go away  from AEA's                                                                    
budget and  would essentially be  removed from  the process.                                                                    
The second fiscal note from  AEA was for DCCED's Division of                                                                    
Investments; instead  of containing the $86,000  that was in                                                                    
the original fiscal note, the  new note directed the $53,600                                                                    
that used  to be in AEA  to the Division of  Investments. He                                                                    
stated that because AEA would  be retaining its position and                                                                    
also because  the Division  of Investments  wanted to  add a                                                                    
position, the  funding for an  additional position  was kept                                                                    
in the  fiscal note.  He mentioned  that although  the money                                                                    
would not  fully fund the  position, the program  should not                                                                    
require a  dedicated, full-time  position. He  observed that                                                                    
the  cost of  the  additional position  in  the Division  of                                                                    
Investments  would  be charged  directly  to  the Bulk  Fuel                                                                    
Revolving Loan  Fund, instead of going  through the Division                                                                    
of  Community   and  Regional  Affairs  (DCRA);   costs  for                                                                    
additional   positions  used   to  appear   as  inter-agency                                                                    
receipts, but  now the position  could be direct  charged to                                                                    
the program. He  related that the third fiscal  note for the                                                                    
Division of Investments  was zeroed out and did  not need to                                                                    
be transmitted  with the  bill. He  explained that  the note                                                                    
was  zeroed   because  DCRA  currently   provided  technical                                                                    
assistance to  communities that were applying  for loans and                                                                    
that  it  would continue  to  do  so;  DCRA would  still  be                                                                    
helping people with bridge loans,  while the bulk full loans                                                                    
would  be  handled  by  the   Division  of  Investments.  He                                                                    
observed  that  the third  fiscal  note  originally had  the                                                                    
costs  of technical  assistance  changing  from the  general                                                                    
funds  to  the   Bulk  Fuel  Loan  Program,   but  that  the                                                                    
Legislative Finance  Division did not  see any reason  to do                                                                    
it  this   way  because  it   was  DCRA's  role   to  assist                                                                    
communities.                                                                                                                    
                                                                                                                                
1:46:53 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:47:20 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Mr.  Teal  made  a  correction  to  his  previous  statement                                                                    
regarding the  third fiscal note  and clarified that  it was                                                                    
the DCRA fiscal  note that had been zeroed and  did not need                                                                    
to   be  transmitted   with  the   bill;  the   Division  of                                                                    
Investments'  note still  reflected  $53,600. He  summarized                                                                    
that the  net change  in operating cost  was zero,  but that                                                                    
there  was  an  annual  loss  in  general  fund  revenue  of                                                                    
$57,000.                                                                                                                        
                                                                                                                                
Vice-Chair   Fairclough   inquired   if  the   Division   of                                                                    
Investments' note  could be structured to  fund the position                                                                    
at a .50  full-time equivalent (FTE). She  observed that the                                                                    
new position  was only being  partially funded  and wondered                                                                    
whether the fiscal note should  reflect that aspect in order                                                                    
to  inform  the department  of  what  the expectations  were                                                                    
regarding its role  in funding the position.  She queried if                                                                    
there  were   receipts  or  other  dollars   that  might  be                                                                    
available  to "backfill"  the  position if  a  full FTE  was                                                                    
included in the  fiscal note. Mr. Teal replied  that a half-                                                                    
time position  could be added,  but that if the  Division of                                                                    
Investments  needed a  position,  it would  have  to hire  a                                                                    
full-time one. He observed that  the Division of Investments                                                                    
had requested $86,000 for the  position, but that the fiscal                                                                    
note only  funded $53,600; in order  to get the rest  of the                                                                    
funding, the  division would have  to pull money  from other                                                                    
loan  programs. He  stated  that the  fiscal  note funded  a                                                                    
half-time to three-quarter-time position,  but that the note                                                                    
could  be changed  to reflect  a half-time  position if  the                                                                    
committee  so  desired;  however,  changing  the  position's                                                                    
classification did not make a lot of difference.                                                                                
                                                                                                                                
1:50:42 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:50:57 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Vice-Chair Fairclough wondered  whether the committee should                                                                    
consider   additional  funding   or   compensation  in   the                                                                    
legislation for  the development  of regulations.  She noted                                                                    
that  the   bill  was  asking  for   consolidation  and  was                                                                    
providing   money  for   a  half-time   FTE;  however,   the                                                                    
department would be required to  make new regulations, which                                                                    
would  take time  and money.  She stated  that when  she had                                                                    
originally examined  the fiscal notes, she  had wondered why                                                                    
there was not  more funding, given the  additional work that                                                                    
DCCED  would  have  to  complete.  She  concluded  that  the                                                                    
department would  need to provide information  regarding the                                                                    
regulations  in  an  expedient manner  and  that  additional                                                                    
funding would probably be needed to do so.                                                                                      
                                                                                                                                
Representative Edgmon  stated that  he had been  an employee                                                                    
of DCCED and had worked  with the Division of Administration                                                                    
to draft regulations; he recalled  that the department had a                                                                    
full-time staff  that worked on regulations,  but that there                                                                    
might be a  little more time involved with  "other parts" of                                                                    
HB 196.                                                                                                                         
                                                                                                                                
1:52:11 PM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough  MOVED to report CSHB  196(FIN) out of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSHB  196(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass" recommendation and with  three new fiscal impact notes                                                                    
by  the  House  Finance  Committee  for  the  Department  of                                                                    
Commerce, Community and Economic Development.                                                                                   
                                                                                                                                
1:52:28 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:55:05 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 261                                                                                                            
                                                                                                                                
     "An Act relating to loans for the purchase of                                                                              
     commercial fishing entry permits; and providing for an                                                                     
     effective date."                                                                                                           
                                                                                                                                
Co-Chair Stoltze  pointed to the  previously adopted  CS for                                                                    
HB 261, Work Draft  27-LS0968\B (Bullard, 3/19/12) and added                                                                    
that there had been an issue regarding the fiscal note.                                                                         
                                                                                                                                
TIMOTHY CLARK, STAFF,  REPRESENTATIVE BRYCE EDGMON, directed                                                                    
the  committee's  attention  to  the zero  fiscal  note  and                                                                    
stated that its only revisions  were the deletions of errors                                                                    
on the analysis page.                                                                                                           
                                                                                                                                
Representative  Edgmon added  that  the  two sentences  that                                                                    
referred to  an earlier version  of the bill were  taken out                                                                    
of the fiscal note, but that it still remained a zero note.                                                                     
                                                                                                                                
Representative  Neuman   stated  that   he  had   made  some                                                                    
inquiries   outside   of   the   committee   regarding   the                                                                    
legislation  and mentioned  that  the interest  rate on  the                                                                    
fishing  loans had  been changed  several times.  He pointed                                                                    
out that  if there  was a lower  interest rate  available to                                                                    
someone  who had  already taken  a commercial  fishing loan,                                                                    
the borrower could apply to  refinance at the lower rate for                                                                    
a fee of around $100.                                                                                                           
                                                                                                                                
Vice-Chair  Fairclough   discussed  a  letter   in  members'                                                                    
packets,   which  had   expressed   concern  regarding   the                                                                    
legislation. She  was supportive  of the bill's  intent, but                                                                    
wanted to give the sponsor  an opportunity to respond to the                                                                    
concerns. She stated that her  understanding of the bill was                                                                    
that it  provided lower-cost money  than was available  in a                                                                    
commercial  loan market  after an  individual was  unable to                                                                    
qualify  in that  commercial market.  She  inquired how  the                                                                    
state determined  whether an applicant  for a loan  had been                                                                    
declined or  had simply failed qualify,  and further queried                                                                    
if  there  was something  in  statutes  or regulations  that                                                                    
helped  make   that  determination.   Representative  Edgmon                                                                    
paraphrased  from the  Commercial Fishing  Lone Act  statute                                                                    
and stated that  a borrower was only eligible  for Section B                                                                    
loans if  he or she  "is not  eligible for financing  from a                                                                    
state  financial institution  as defined  in Title  6, or  a                                                                    
federally   chartered   financial    institution,   or   the                                                                    
Commercial Fishing and Agriculture Bank (CFAB)."                                                                                
                                                                                                                                
Vice-Chair Fairclough  reiterated that she was  still unsure                                                                    
how  the eligibility  was determined.  Representative Edgmon                                                                    
responded that the eligibility  requirements for the Section                                                                    
B loans  specified that  in order  to qualify,  someone must                                                                    
have been  a state  resident for a  continuous period  of at                                                                    
least  two   years  directly  preceding  the   date  of  the                                                                    
application, must not be eligible  through a commercial bank                                                                    
or  CFAB,  must  lack employment  opportunities  other  than                                                                    
commercial  fishing, must  not have  past due  on any  child                                                                    
support  obligations, and  must never  have received  a loan                                                                    
under  the Section  A provision  of  the Commercial  Fishing                                                                    
Revolving Loan Act. He observed  that all of the requirement                                                                    
provisions would  make it difficult, if  not impossible, for                                                                    
an applicant  to seek lending through  traditional means and                                                                    
concluded that the  bill offered a "leg up"  to those trying                                                                    
to get involved in the commercial fishing industry.                                                                             
                                                                                                                                
1:59:47 PM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough  observed that there was  a difference                                                                    
between  qualifying for  a loan  under the  current language                                                                    
versus being declined  by a commercial lender,  but that she                                                                    
understood and supported the intent  of the legislation. She                                                                    
inquired if  there was  a way  for a  Section B  borrower to                                                                    
receive discounts  on the loan percentages  for consistently                                                                    
making payments  on time.  Representative Edgmon  replied in                                                                    
the affirmative  and elaborated that  it was called  the Pay                                                                    
On-Time  program;  if  a  borrower  had  complied  with  the                                                                    
payments for the  first year, they would be  eligible for as                                                                    
much as  a 1 percent reduction  to the interest rate  of the                                                                    
loan. He  explained that if  a borrower entered  the program                                                                    
at  a 5.25  percent interest  rate and  all went  well, they                                                                    
would be eligible  to lower their rate to as  little as 4.25                                                                    
percent.                                                                                                                        
                                                                                                                                
Vice-Chair Fairclough  wondered how the  discounted interest                                                                    
rate would compare and compete in a commercial market.                                                                          
                                                                                                                                
Co-Chair Stoltze  observed there had not  been any testimony                                                                    
from  the traditional  banks on  the legislation.  He opined                                                                    
that CFAB  seemed to  be more  interested in  protecting its                                                                    
"turf" than serving the state's farmers and fishermen.                                                                          
                                                                                                                                
Co-Chair  Thomas  told  a  personal   story  about  his  son                                                                    
receiving a  state loan to buy  a boat. His son  had applied                                                                    
and had been  turned down by two traditional  banks, but had                                                                    
eventually received a  loan from the state.  He offered that                                                                    
the difference  between the traditional banks  and state was                                                                    
that the banks did not ask  him to cosign on his son's loan,                                                                    
but  that he  had cosigned  on the  state loan.  He recalled                                                                    
that he had been denied for  a loan from CFAB about 25 years                                                                    
prior because  he was not  qualified. He stated that  he had                                                                    
attempted to go through CFAB  for a Bristol Bay fishing boat                                                                    
and gillnet  permit because he  knew that he would  not have                                                                    
qualified through a commercial bank  or the state. He shared                                                                    
that although  he had 20  years of prior  fishing experience                                                                    
as a gillnetter  in Southeast Alaska, CFAB had  denied him a                                                                    
loan because  they thought he  lacked experience.  He voiced                                                                    
agreement  with   Co-Chair  Stoltze's   earlier  observation                                                                    
regarding CFAB's desire to protect  its "turf." He supported                                                                    
the legislation  and thought it  would help  young fishermen                                                                    
who were starting out in the industry.                                                                                          
                                                                                                                                
Vice-Chair Fairclough directed  the committee's attention to                                                                    
multiple letters  of support, which  raised issues  with the                                                                    
earlier mentioned letter of concern.                                                                                            
                                                                                                                                
2:04:13 PM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough  MOVED to report CSHB  261(FIN) out of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSHB  261(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass" recommendation and with one  new zero impact note from                                                                    
the   Department  of   Commerce,   Community  and   Economic                                                                    
Development and  one previously published zero  fiscal note:                                                                    
FN1 (DFG).                                                                                                                      
                                                                                                                                
2:04:58 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:07:37 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 358                                                                                                            
                                                                                                                                
     "An Act relating to an advertising campaign in support                                                                     
     of opening the Arctic National Wildlife Refuge for                                                                         
     development."                                                                                                              
                                                                                                                                
2:07:44 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze  discussed the  issues of concern  that had                                                                    
been  expressed  during  HB 358's  prior  hearing;  the  two                                                                    
issues were  that the CS  needed an addition to  prevent the                                                                    
legislation  from  influencing  political  action  and  that                                                                    
there  needed to  be  a  cap placed  on  the maximum  dollar                                                                    
amount of the advertising campaign.                                                                                             
                                                                                                                                
Vice-Chair Fairclough MOVED to  ADOPT the proposed committee                                                                    
substitute  for  HB  358, Work  Draft  27-LS1406\I  (Bailey,                                                                    
3/19/12) as a working document.                                                                                                 
                                                                                                                                
Co-Chair Stoltze OBJECTED for the purpose of discussion.                                                                        
                                                                                                                                
REPRESENTATIVE  LANCE PRUITT,  SPONSOR, asked  his staff  to                                                                    
discuss the change in the new CS.                                                                                               
                                                                                                                                
DIRK  CRAFT, STAFF,  REPRESENTATIVE LANCE  PRUITT, explained                                                                    
that the only  addition to the CS was  Section 1, subsection                                                                    
(e)(4), which  was on  Page 2, line  26 of  the legislation.                                                                    
Subsection  (e)(4)   was  added  at   Representative  Gara's                                                                    
request in  order to insure  that the legislation  would not                                                                    
be used  for any lobbying  purposes on any  elected official                                                                    
or any kind of campaign.                                                                                                        
                                                                                                                                
Co-Chair  Stoltze requested  the  exact wording  of the  new                                                                    
language.  Mr. Craft  read  from the  bill  starting on  the                                                                    
beginning of subsection E on line 16.                                                                                           
                                                                                                                                
     "A qualified trade association may not use money from                                                                      
     a contract awarded under (a) of this section"                                                                              
                                                                                                                                
Mr. Craft continued reading from the bill on subsection                                                                         
(e)(4).                                                                                                                         
                                                                                                                                
     "in an advertising campaign that refers to a                                                                               
    particular elected official or candidate for public                                                                         
     office or specifically promotes or criticizes a                                                                            
     political party."                                                                                                          
                                                                                                                                
Co-Chair Stoltze commented that  the other issue of concern,                                                                    
which was the  maximum cap of the  advertising campaign, had                                                                    
been addressed in the fiscal note.                                                                                              
                                                                                                                                
Mr. Craft  remarked that  the sponsor  had attempted  to put                                                                    
the  cap  in the  legislation  itself,  but that  they  were                                                                    
advised against  putting it directly  in statute  because it                                                                    
would take away from the  appropriating powers of the Alaska                                                                    
Legislature.  Co-Chair  Stoltze  interjected that  it  would                                                                    
certainly  take away  flexibility from  the legislature  and                                                                    
that  fiscal  notes  were  a  more  flexible  document  than                                                                    
statutes.                                                                                                                       
                                                                                                                                
Vice-Chair Fairclough  discussed the  fiscal from  the House                                                                    
Finance   Committee   for   DCCED;    the   note   set   the                                                                    
aforementioned  cap at  $1.5 million  in general  funds. She                                                                    
spoke to several indeterminate fiscal notes.                                                                                    
                                                                                                                                
Co-Chair  Stoltze indicated  that the  committee would  only                                                                    
adopt   the  House   Finance  Committee   fiscal  note   and                                                                    
identified it as OMB component number 1844.                                                                                     
                                                                                                                                
Co-Chair  Stoltze WITHDREW  his  OBJECTION.  There being  NO                                                                    
further OBJECTION, Work Draft 27-LS1406\I was ADOPTED.                                                                          
                                                                                                                                
2:12:14 PM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough  MOVED to report CSHB  358(FIN) out of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
Representative Gara  inquired if  the program would  run for                                                                    
two  years. Co-Chair  Stoltze responded  in the  affirmative                                                                    
and that it would run until 2015.                                                                                               
                                                                                                                                
2:13:12 PM                                                                                                                    
                                                                                                                                
CSHB  358(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass" recommendation  and with a  new fiscal impact  note by                                                                    
the House Finance Committee for  the Department of Commerce,                                                                    
Community and Economic Development.                                                                                             
                                                                                                                                
Representative Joule  referenced comments that were  made in                                                                    
a prior meeting, in which  Vice-Chair Fairclough discussed a                                                                    
trip that  Alaska Legislators had taken  to Washington, D.C.                                                                    
He discussed  the need to for  Alaska to do work  around the                                                                    
country  to  get  a groundswell  of  support  regarding  the                                                                    
Arctic  National  Wildlife  Refuge (ANWR)  and  opined  that                                                                    
being reactive to particular bill  "has not been getting the                                                                    
job done."  He offered that  having a more  full-time effort                                                                    
was  the beginning  of Alaska's  future  regarding ANWR,  as                                                                    
well  as  other issues  facing  the  state. He  shared  that                                                                    
unfortunately,  Congress   and  others  outside   of  Alaska                                                                    
operated with very little accurate  information and that how                                                                    
the  state marketed  itself those  individuals and  entities                                                                    
was important.                                                                                                                  
                                                                                                                                
2:15:04 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:18:46 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 337                                                                                                            
                                                                                                                                
     "An  Act  relating to  the  Board  of Registration  for                                                                    
     Architects, Engineers,  and Land  Surveyors and  to the                                                                    
     Department   of  Commerce,   Community,  and   Economic                                                                    
     Development."                                                                                                              
                                                                                                                                
2:18:46 PM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough MOVED to  ADOPT HB 337, 27-LS1405\A as                                                                    
a working document.                                                                                                             
                                                                                                                                
There being NO OBJECTION, HB 337 was ADOPTED.                                                                                   
                                                                                                                                
                                                                                                                                
LYNETTE BERGH, STAFF, REPRESENTATIVE THOMPSON, provided an                                                                      
overview of the legislation:                                                                                                    
                                                                                                                                
     I would like  to thank the Chair and  the Committee for                                                                    
     hearing House Bill  337 today, "An Act  relating to the                                                                    
     Board  of Registration  for Architects,  Engineers, and                                                                    
     Land  Surveyors  and  to the  Department  of  Commerce,                                                                    
     Community, and Economic Development."                                                                                      
                                                                                                                                
     For  brevity's  sake, I  will  refer  to the  Board  of                                                                    
     Architects, Engineers,  and Land Surveyors as  the AELS                                                                    
     board.                                                                                                                     
                                                                                                                                
     House  Bill 337  revises  the Statutes  to designate  a                                                                    
     full-time  investigator,  rather   than  part-time,  to                                                                    
     serve  the AELS  Board.  This  full-time position  will                                                                    
     ensure  that  the  AELS  Board  can  meet  the  growing                                                                    
     demands of oversight  of the industries in  its area of                                                                    
     responsibility.                                                                                                            
                                                                                                                                
     Currently,   the  AELS   Board  shares   one  part-time                                                                    
     investigator  with  five   other  Boards:  Construction                                                                    
     Contractors,      Home      Inspectors,      Electrical                                                                    
     Administrator,  Mechanical  Administrator, and  Storage                                                                    
     Tank Workers.  The investigator's oversight  includes a                                                                    
     total  of  approximately  20,000  licensees.  Of  these                                                                    
     20,000  licensees, 28%  of them  are AELS  registrants.                                                                    
     That's over 5,600 licensees for the AELS Board alone.                                                                      
                                                                                                                                
     A new  regulation will take  effect within the  next 30                                                                    
     days. Ten additional  engineering professions that have                                                                    
     not been previously regulated will  be placed under the                                                                    
     AELS  Board's  oversight.   Therefore,  the  number  of                                                                    
     branches will expand  from the current 6  branches to a                                                                    
     new total of  16 branches. Some of  the newly regulated                                                                    
     professions  are  from the  structural,  environmental,                                                                    
     nuclear, and industrial engineer branches.                                                                                 
                                                                                                                                
     This  means  the number  of  licensees  the AELS  Board                                                                    
     oversees  will increase  drastically.  It is  necessary                                                                    
     for  the  safety of  Alaskans  to  add these  branches;                                                                    
     however, the addition of these  10 branches will add to                                                                    
     an   already   heavy   workload   for   the   part-time                                                                    
     investigator.                                                                                                              
                                                                                                                                
     Each of the six  Boards that the part-time investigator                                                                    
     oversees  has an  increasing number  of licensees.  The                                                                    
     investigator  faces  mounting  pressure to  spend  less                                                                    
     time on AELS  Board registrants and more time  on the 5                                                                    
     other boards  to which he is  assigned.  On top  of the                                                                    
     oversight workload, this  sole investigator is required                                                                    
     to maintain  knowledge of all statutes  and regulations                                                                    
     of all boards he oversees.                                                                                                 
                                                                                                                                
     Clearly, the  lack of a full-time  investigator for the                                                                    
     Board could  reduce its  effectiveness in  carrying out                                                                    
     charges required  by the Statutes and  the Regulations.                                                                    
     An   unintended   consequence    of   overloading   the                                                                    
     investigator may result in a  failure to fulfill to the                                                                    
     fullest extent  the State and Regulatory  charges. As a                                                                    
     result, the  State of  Alaska may be  put at  risk, and                                                                    
     inadvertently  create   a  hazard  to   public  health,                                                                    
     safety, and welfare.                                                                                                       
                                                                                                                                
     House  Bill 337  will ensure  that the  AELS Board  can                                                                    
     continue  proper  oversight   of  the  licensees  while                                                                    
     remaining in compliance with  all State Regulations and                                                                    
     all State  Statutes mandated by  the Legislature.  As a                                                                    
     result  of hiring  a full-time  investigator, the  AELS                                                                    
     Board  will  be able  to  maintain  its reputation  and                                                                    
     integrity of the professions it oversees.                                                                                  
                                                                                                                                
2:23:21 PM                                                                                                                    
                                                                                                                                
Ms. Bergh continued to discuss HB 337:                                                                                          
                                                                                                                                
     At this time,  I would like to address  the fiscal note                                                                    
     and  point out  that the  AELS Board  intends to  begin                                                                    
     forward  funding  the full-time  investigator  position                                                                    
     starting  in  December  2013 at  which  time  the  next                                                                    
     scheduled fee increase will take  place.  Currently the                                                                    
     licensees  pay $125.00  for biennial  licensure. It  is                                                                    
     estimated  that  the  pay  increase  will  be  minimal,                                                                    
     approximately $20  or less per  licensee per  year. All                                                                    
     testimony  to  date  has  been  in  favor  of  the  pay                                                                    
     increase. There was no testimony in opposition.                                                                            
                                                                                                                                
Co-Chair Stoltze inquired whether the landscape architects                                                                      
were still members of AELS board. Ms. Bergh replied in the                                                                      
affirmative.                                                                                                                    
                                                                                                                                
Co-Chair Stoltze inquired why  landscape architects were not                                                                    
referred  to  in  the  bill title.  Ms.  Bergh  opined  that                                                                    
perhaps  landscape architects  had  been  combined into  the                                                                    
general category  of architects,  but admitted that  she was                                                                    
unsure of the answer.                                                                                                           
                                                                                                                                
Co-Chair Stoltze  noted that  when the  landscape architects                                                                    
had first  come on  the AELS board,  they originally  had no                                                                    
interest  in having  a board  seat;  however, after  several                                                                    
years, they changed their minds  and had repeatedly tried to                                                                    
get  a  seat  on  the  board.  He  observed  that  landscape                                                                    
architects  represented a  very  small part  of industry  in                                                                    
terms of  size and  numbers and that  although they  did not                                                                    
have a  seat on the  board, they did have  representation on                                                                    
the board. He shared that  the landscape architects had been                                                                    
"brutal" with him  once he had reminded them  of their "past                                                                    
agreement,"  and  inquired  if  the bill  would  enable  the                                                                    
landscape architects  to resurface the issue  of obtaining a                                                                    
seat  on the  AELS  board.  Ms. Bergh  replied  that to  her                                                                    
knowledge, it did not put that offer on the table.                                                                              
                                                                                                                                
Co-Chair Stoltze stated  that he preferred a  "no" answer to                                                                    
"not to my  knowledge" and queried if  the sponsor supported                                                                    
or opposed  the landscape  architects having  a seat  on the                                                                    
AELS board.  Ms. Bergh  replied that  the sponsor  wanted to                                                                    
make sure that the AELS  board, with its current makeup, had                                                                    
enough oversight by giving it  a full-time investigator. She                                                                    
related that  the sponsor was  not adding other  boards, but                                                                    
noted that  the AELS board had  met in December of  2011 and                                                                    
had decided to  add some new branches; however,  none of the                                                                    
additions included the landscape architects.                                                                                    
                                                                                                                                
2:26:28 PM                                                                                                                    
                                                                                                                                
Representative Costello  inquired if Don Habegar  could come                                                                    
to the table  and answer questions and  mentioned that there                                                                    
had  been  lengthy  testimony   in  the  DCCED  subcommittee                                                                    
related to some challenges  involved with investigations and                                                                    
the process of  investigations, as well as  the rising costs                                                                    
that  all   of  the   professional  licensing   boards  were                                                                    
experiencing.  She  asked  Mr.   Habegar  to  share  DCCED's                                                                    
efforts to  get a handle on  the issue and related  that she                                                                    
was concerned  with the solution of  adding an investigator.                                                                    
She  offered   that  it  was  her   understanding  that  the                                                                    
department  was  currently  analyzing  the  process  of  how                                                                    
investigations  were handled  and  that  "perhaps not  every                                                                    
complaint needs  to be taken  to the nth degree  before it's                                                                    
turned away." She  indicated that she did not want  to see a                                                                    
pattern  of  the   different  boards  requesting  additional                                                                    
investigators  when  the  department was  currently  in  the                                                                    
middle  of a  process  that was  attempting  to address  the                                                                    
problem.                                                                                                                        
                                                                                                                                
DON HABEGAR,  DIRECTOR, DIVISION OF  CORPORATIONS, BUSINESS,                                                                    
AND   PROFESSIONAL   LICENSING,  DEPARTMENT   OF   COMMERCE,                                                                    
COMMUNITY  AND   ECONOMIC  DEVELOPMENT,  replied   that  the                                                                    
division   was  going   through  an   intensive  review   of                                                                    
investigations  because of  legislative audits,  as well  as                                                                    
other concerns  over the years  regarding timeliness  in the                                                                    
investigative processes.  He shared  that one of  the things                                                                    
that  the  division  was  attempting   to  correct  was  its                                                                    
investigative  software; although  the  software system  was                                                                    
relatively new and  was intended to address a  number of the                                                                    
issues,  it became  clear after  working  with the  software                                                                    
that there  were a  number of  improvements that  were still                                                                    
needed in that  area. He related that the  analysis had been                                                                    
completed  and  that   the  recommendations  were  currently                                                                    
before management.  The software was  just one example  of a                                                                    
process that  the division was  going through.  He mentioned                                                                    
that some of  the audits had requested  simple changes, such                                                                    
as  having a  correct hierarchy  of investigators  under the                                                                    
chief;  the division  was in  the process  of instituting  a                                                                    
senior  investigator position  to address  that concern.  He                                                                    
mentioned that  it was true  that the department was  in the                                                                    
middle  of   "these  fixes,"  but  that   the  requests  for                                                                    
investigations and  the demand  for the  investigators' time                                                                    
had  also  been increasing.  He  stated  that in  2011,  the                                                                    
Division   of  Corporations,   Business,  and   Professional                                                                    
licensing  had  1100 requests  from  the  public, which  had                                                                    
asked  for attention  to make  sure  a licensee  was not  in                                                                    
violation of  rules and  regulations; the  division's report                                                                    
was  posted  in  its  website.  He shared  that  he  had  18                                                                    
investigators who each  had an average caseload  of about of                                                                    
40 to 45 cases per year  and that the division was trying to                                                                    
manage its  resources in the  face of rising demand  for its                                                                    
investigators' time.                                                                                                            
                                                                                                                                
2:30:53 PM                                                                                                                    
                                                                                                                                
Representative  Wilson inquired  if ten  additional branches                                                                    
would  be added  to the  AELS board.  Mr. Habegar  responded                                                                    
that   through  new   regulations,  there   were  additional                                                                    
disciplines   in  the   engineering   field  that   required                                                                    
licensure  and   that  his   understanding  was   that  some                                                                    
engineers  that currently  were  generally  licensed may  be                                                                    
able to specialize and convert  to a specific license, which                                                                    
would  be one  of the  new categories.  He added  that there                                                                    
would  be  other  categories  that were  new  to  the  state                                                                    
system.                                                                                                                         
                                                                                                                                
Representative   Wilson  wondered   how   many  people   the                                                                    
additional  branches would  represent.  Mr. Habegar  replied                                                                    
that there were estimates from  his staff that the number of                                                                    
new licensures in the new  disciplines would be around 1,000                                                                    
individuals; he was unsure regarding  the correctness of the                                                                    
estimate, but recalled hearing that number.                                                                                     
                                                                                                                                
Representative   Wilson   inquired    why   the   additional                                                                    
disciplines were being added because  she had not heard of a                                                                    
lot  of safety  issues. Mr.  Habegar responded  that it  was                                                                    
difficult for him to speak on  behalf of the AELS board, but                                                                    
that the statutes  required the board to  regulate their own                                                                    
profession; he  opined that he  could speculate  the board's                                                                    
reasoning  and   offered  that  it  probably   thought  that                                                                    
specialization was  better for  the profession.  He observed                                                                    
that  there  had been  a  lengthy  public processes  on  the                                                                    
specialization  and  that  eventually the  regulations  were                                                                    
passed.                                                                                                                         
                                                                                                                                
Representative Wilson  wondered if  adding the  extra people                                                                    
would change the  composition of the board  and inquired how                                                                    
much revenue the new investigator  would cost the state. She                                                                    
felt that she did not have enough information on the bill.                                                                      
                                                                                                                                
Representative Gara  stated that  he would have  opposed the                                                                    
bill if it  were not for the fact that  the AELS board would                                                                    
be  paying  for  the  investigator.  He  observed  that  the                                                                    
position would cost $109,000 and  that the board would self-                                                                    
regulate  by raising  fees on  its own  members to  fund the                                                                    
position. He  concluded that the  bill had zero cost  to the                                                                    
state and that  he was comfortable with  the legislation. He                                                                    
inquired if his  understanding of the bill  was correct. Mr.                                                                    
Habegar  responded in  the  affirmative  and explained  that                                                                    
licensing statute  required that  the costs would  be passed                                                                    
on to licensees and that it would come from increased fees.                                                                     
                                                                                                                                
Representative  Gara queried  how the  legislature could  be                                                                    
comfortable that the members of  a particular profession had                                                                    
agreed to  the changes  and inquired  whether the  board had                                                                    
made  the   decision  themselves   as  "spokesmen   for  the                                                                    
profession." Mr. Habegar responded  that there were a number                                                                    
people from the profession who  were available to testify on                                                                    
the bill during  a Labor and Commerce  Committee meeting and                                                                    
that all of those testifiers had supported the bill.                                                                            
                                                                                                                                
Representative  Gara stated  that if  there was  a backlash,                                                                    
the position could be taken  out. He reiterated that the new                                                                    
position did not cost the state  anything and that he was ok                                                                    
with the bill.                                                                                                                  
                                                                                                                                
2:34:48 PM                                                                                                                    
                                                                                                                                
Representative Guttenberg thought that  the board was pretty                                                                    
contentious. He asked what  percentage of the investigations                                                                    
that were conducted ended  up being "actionable" afterwards.                                                                    
Mr. Habegar  replied that he  did not have  that information                                                                    
with him, but that he would get it for the committee.                                                                           
                                                                                                                                
Representative  Neuman  inquired   whether  the  AELS  board                                                                    
currently had  an investigator  and if it  did not,  how its                                                                    
investigations were  handled. Mr.  Habegar replied  that the                                                                    
Division   of  Corporations,   Business,  and   Professional                                                                    
Licensing had  18 investigators  and that,  through statute,                                                                    
only   the  medical   board   currently   had  a   dedicated                                                                    
investigator. He explained that  the other boards shared the                                                                    
investigators  and  that  there   was  system  in  place  to                                                                    
determine  where the  investigators were  needed. He  shared                                                                    
that currently, there was one  investigator that solely took                                                                    
care of the  construction industry and that  the majority of                                                                    
the investigator's time was  spent on architects, engineers,                                                                    
and  land   surveyors.  He  mentioned  that   DCCED  had  an                                                                    
agreement  with  the  Department   of  Labor  and  Workforce                                                                    
Development for  additional investigative resources  for the                                                                    
construction industry.                                                                                                          
                                                                                                                                
Representative Neuman  assumed that adding  the investigator                                                                    
would expedite disputes that came  before the AELS board and                                                                    
inquired if  this was the justification  of the legislation.                                                                    
Mr.  Habegar responded  that the  AELS  board believed  that                                                                    
adding an investigator would enable  better service and that                                                                    
he agreed with the board's assessment.                                                                                          
                                                                                                                                
Representative Gara "tepidly" supported  the bill because he                                                                    
did   not  believe   the  caseload   of   the  Division   of                                                                    
Corporations,   Business,   and   Professional   Licensing's                                                                    
investigators  was  compelling.  He  offered  that  district                                                                    
attorneys and  public defenders  typically had  caseloads of                                                                    
over  100 cases  and worked  very long  hours, but  that the                                                                    
division's investigators only had  caseloads of 40 cases. He                                                                    
stated  that he  was supportive  of the  legislation because                                                                    
the  profession  wanted  to regulate  itself  and  fund  the                                                                    
position itself.  Mr. Habegar  clarified that  the best-case                                                                    
scenario for  his investigators was  a caseload of 40  to 45                                                                    
cases,  but  that in  reality,  the  investigators had  more                                                                    
cases than that.                                                                                                                
                                                                                                                                
2:38:38 PM                                                                                                                    
                                                                                                                                
Representative  Costello noted  that the  bill would  create                                                                    
one  dedicated  investigator  for one  specific  board,  but                                                                    
observed  that  other  boards   were  also  experiencing  an                                                                    
increase in  investigator demand.  She wondered  whether the                                                                    
sponsor would be  willing to change the  legislation so that                                                                    
the  added position  would benefit  all of  the professional                                                                    
licensing boards;  DCCED could  be given the  flexibility to                                                                    
assign the new  investigator to where the  workload was. She                                                                    
observed  that the  investigator  could be  assigned to  the                                                                    
AELS board  full-time, but  would be  directed to  where the                                                                    
need  was.  Ms. Bergh  replied  that  the sponsor  had  been                                                                    
concerned about the number of  licensees that were under the                                                                    
purview  of  the part-time  investor  that  served the  AELS                                                                    
board. She  added that because  the number of  licensees and                                                                    
branches  under the  AELS board  was growing,  there was  an                                                                    
imbalance of  the amount of  work that the  investigator was                                                                    
able to  handle for the  AELS board versus the  other boards                                                                    
that were  served. The sponsor  believed it would be  a good                                                                    
idea to have one investigator for the AELS board.                                                                               
                                                                                                                                
Representative   Costello   queried    whether   DCCED   had                                                                    
considered requesting an  additional investigator during the                                                                    
budget  process  or  if  the  department  had  held  off  on                                                                    
requesting the position because  it was studying the problem                                                                    
first.  Mr.  Habegar replied  that  the  department did  not                                                                    
consider  making  any  changes  to  staffing  until  it  had                                                                    
further  investigated a  number  of issues  that had  driven                                                                    
comments of concern in the legislative audits.                                                                                  
                                                                                                                                
Representative   Costello  inquired   when  the   department                                                                    
expected  its  recommendations  to be  made  available.  Mr.                                                                    
Habegar  responded   that  the  Division   of  Corporations,                                                                    
Business, and Professional Licensing was  on the tail end of                                                                    
a  cost allocation  analysis, which  would  be completed  in                                                                    
approximately 30  to 60  days. He  stated that  the division                                                                    
thought it  would have better recommendations  in the spring                                                                    
of 2012.                                                                                                                        
                                                                                                                                
2:41:21 PM                                                                                                                    
                                                                                                                                
BOYD  BROWNFIELD,  SELF,   ANCHORAGE  (via  teleconference),                                                                    
spoke  in  support  of  the   legislation  and  related  his                                                                    
personal experience of  serving as both the  chair and vice-                                                                    
chair of  the AELS board  in the past. He  expressed support                                                                    
of AELS  having its own  investigator and mentioned  that it                                                                    
was  the third  largest board  out of  about 18  boards, but                                                                    
that it  was first  in the  category complexity.  Within the                                                                    
engineering profession  alone, there  were six  separate and                                                                    
distinct  branches,  each  of   which  represented  its  own                                                                    
challenges;  the 6  branches were  expected  to increase  in                                                                    
number  to 15.  The uniqueness  of the  AELS board  placed a                                                                    
special demand  on its investigator.  He explained  that the                                                                    
current investigator  served the AELS board  only 20 percent                                                                    
of the time and was assigned  to 5 other boards. The board's                                                                    
sole mandate  was to  carry out its  mission to  protect the                                                                    
public's health, safety, and  welfare through the regulation                                                                    
of architecture, engineering,  land surveying, and landscape                                                                    
architecture. He related that  the fourth largest board, the                                                                    
medical  board,  currently  had  its  own  investigator.  He                                                                    
thought that  it was imperative  that the AELS have  a full-                                                                    
time investigator if  it was to do an  effective job serving                                                                    
the entire state.                                                                                                               
                                                                                                                                
2:46:06 PM                                                                                                                    
                                                                                                                                
Mr. Brownfield addressed earlier  comments that were made in                                                                    
committee  and explained  that  landscape  architects had  a                                                                    
temporary,  non-voting seat  on the  AELS board;  there were                                                                    
only about  35 registrants from landscape  architects on the                                                                    
board. He  observed that the landscape  architects acted and                                                                    
participated  on the  board; however,  by statute,  the seat                                                                    
was  temporary  and  non-voting.  He  spoke  to  an  earlier                                                                    
question   regarding  why   the  number   of  branches   was                                                                    
increasing to 15 from 6 and  relayed that for 27 years there                                                                    
had been  6 branches of  engineering in state;  he explained                                                                    
that Alaska was one of the  few states that still only had 6                                                                    
branches.  He  shared  an  example   that  if  a  structural                                                                    
engineer entered  Alaska, they could  not work in  the state                                                                    
under that branch  and would be required to take  an exam to                                                                    
work as  a civil engineer; agricultural  engineers in Alaska                                                                    
were   likewise  required   to  take   the  civil   engineer                                                                    
examination. He stressed  that it was time for  the state to                                                                    
recognize that  6 branches were  not sufficient  and offered                                                                    
that  the  state  was losing  business.  He  reiterated  the                                                                    
importance of a full-time investigator for the AELS board.                                                                      
                                                                                                                                
2:49:41 PM                                                                                                                    
                                                                                                                                
Co-Chair  Thomas   noted  that  the   legislation's  sponsor                                                                    
statement  indicated  that  there  would  be  6  to  16  new                                                                    
branches added  to the  AELS board,  which was  probably the                                                                    
reason people  were referring  to 16  branches as  a number.                                                                    
Mr.  Brownfield  replied that  one  of  the professions  was                                                                    
architect engineer;  however, the  board felt that  it would                                                                    
be  confusing to  the public  if architects  were considered                                                                    
engineers and as a result, that branch was not included.                                                                        
                                                                                                                                
HARLEY   HIGHTOWER,  CHAIR,   BOARD   OF  REGISTRATION   FOR                                                                    
ARCHITECTS,  ENGINEERS, AND  LAND SURVEYORS,  ANCHORAGE (via                                                                    
teleconference), vocalized the AELS  board's support for the                                                                    
legislation  and  concurred  with  the  testimony  of  prior                                                                    
testifiers. He  related that  because of a  lack of  a full-                                                                    
time investigator,  the board was presently  being prevented                                                                    
from  preforming  its  charge   of  protecting  the  health,                                                                    
safety, and welfare  of the public. He pointed  out that the                                                                    
investigator  who  currently  served   the  AELS  board  was                                                                    
overextended  due  to  his  obligations  to  numerous  other                                                                    
boards, as well  as increases in the  number of registrants.                                                                    
He warned  that the  "present conditions" exposed  the state                                                                    
of Alaska  and the AELS  board to liability. He  related the                                                                    
board's  current fees  were  low  and that  if  a small  fee                                                                    
increase  occurred as  result of  the legislation,  it would                                                                    
not  be  significant.  He   addressed  an  earlier  question                                                                    
regarding  the  possibility  of  an  investigator  pool  and                                                                    
stated that the board had  decided against that idea because                                                                    
it felt  that it would  be difficult for an  investigator to                                                                    
know the  statutes and regulations that  applied to multiple                                                                    
boards.  He  spoke to  an  earlier  comment regarding  being                                                                    
unaware of safety issues in the  state and noted that in the                                                                    
past  month,   there  had  been  three   roof  collapses  in                                                                    
Anchorage  because the  buildings were  not designed  to the                                                                    
standard that they should have been.                                                                                            
                                                                                                                                
2:53:56 PM                                                                                                                    
                                                                                                                                
Co-Chair Thomas CLOSED public testimony.                                                                                        
                                                                                                                                
Vice-Chair  Fairclough observed  that  although some  public                                                                    
comments  had  stated  that  the  board  was  not  adding  a                                                                    
position, the fiscal  note showed that a  position was being                                                                    
adding.  She  wondered   whether  the  current  investigator                                                                    
positions were  funded with general fund  money. Mr. Habegar                                                                    
responded that  the bill did  add one position and  that the                                                                    
investigators  were funded  with general  fund fee-supported                                                                    
services.                                                                                                                       
                                                                                                                                
Vice-Chair Fairclough  commented that the bill  relieved the                                                                    
department of  its current  obligation and  wondered whether                                                                    
there would be an excess  of general fund dollars that could                                                                    
be  used somewhere  else. Mr.  Habegar replied  that he  may                                                                    
have  misspoken and  that  the  investigator positions  were                                                                    
fee-supported;  the  revenue  was raised  through  licensing                                                                    
fees and was used to  support whatever program was required.                                                                    
He explained that  DCCED was required by  statute to analyze                                                                    
programs  ever  year  and  to  recommend  fee  increases  or                                                                    
decreases.                                                                                                                      
                                                                                                                                
Vice-Chair Fairclough inquired  how many investigators there                                                                    
would  be in  2013. Mr.  Habegar  replied that  if the  bill                                                                    
passed,   the  Division   of  Corporations,   Business,  and                                                                    
Professional   Licensing   would   have  a   total   of   19                                                                    
investigators.                                                                                                                  
                                                                                                                                
Representative  Gara expressed  that he  was confused  about                                                                    
the bill.  He related that  the testimony had stated  that a                                                                    
half-time  position  would  be   increased  to  a  full-time                                                                    
position,  but   noted  that  there   was  funding   in  the                                                                    
legislation  for   a  full-time   position.  He   asked  for                                                                    
clarification on  the issue. Mr. Habegar  responded that the                                                                    
bill required a dedicated  investigator, but that there were                                                                    
numerous issues  that the division  needed to deal  with. He                                                                    
shared  that  more  enforcement  investigations  were  being                                                                    
requested by the construction industry  and that it was also                                                                    
the number  one priority for the  home builders association.                                                                    
He stated  that if  the bill  passed, it  was his  intent to                                                                    
give  a full-time  position to  the AELS  board and  use the                                                                    
current  position   control  number  (PCN)   for  additional                                                                    
resources in the construction industry.                                                                                         
                                                                                                                                
Representative Gara  observed that this was  the second time                                                                    
that  day that  DCCED  had attempted  to fill  a  half of  a                                                                    
position  with at  least  the money  for  full position.  He                                                                    
offered that perhaps he had  missed something earlier in the                                                                    
testimony,  but that  he was  just realizing  that the  bill                                                                    
would  be used  to add  half of  a staff  position somewhere                                                                    
else.                                                                                                                           
                                                                                                                                
2:57:59 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Fairclough discussed  that the  current proposal                                                                    
was paid for by receipts  from licensees, which she was okay                                                                    
with. She  inquired if  relieving the  pressure on  the AELS                                                                    
board's investigative efforts would  give the department the                                                                    
opportunity  to  reallocate  available time  to  investigate                                                                    
other licensees under its control.  Mr. Habegar responded in                                                                    
the affirmative.                                                                                                                
                                                                                                                                
Representative  Wilson  surmised  that  using  the  PCN  for                                                                    
another board  would affect how  much that board  was paying                                                                    
in  fees because  someone had  to  make up  the funding  and                                                                    
inquired  if  that  assumption   was  correct.  Mr.  Habegar                                                                    
answered  in the  affirmative and  explained that  state law                                                                    
required  DCCED  to  do  an  annual  analysis  for  all  the                                                                    
programs. He  stated that there  were currently  40 programs                                                                    
and  that  the  Division   of  Corporations,  Business,  and                                                                    
Professional Licensing would adjust  fees based on the usage                                                                    
of in-house resources.                                                                                                          
                                                                                                                                
Representative  Wilson inquired  whether  40 programs  meant                                                                    
that  there  were 40  boards.  Mr.  Habegar replied  in  the                                                                    
negative and explained  that Title 8 of  the Alaska Statutes                                                                    
had  40 programs,  but  that  20 of  them  were  run by  the                                                                    
division and 20 were boarded.                                                                                                   
                                                                                                                                
Vice-Chair  Fairclough  discussed   a  previously  published                                                                    
fiscal  impact  note  from  the  Division  of  Corporations,                                                                    
Business, and Professional Licensing.                                                                                           
                                                                                                                                
Representative Neuman  inquired if the fiscal  note was paid                                                                    
for by  fees and not  general funds. Ms. Bergh  responded in                                                                    
the affirmative.                                                                                                                
                                                                                                                                
Co-Chair Thomas  pointed to  the fund  source on  the fiscal                                                                    
note.                                                                                                                           
                                                                                                                                
3:01:12 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Fairclough  MOVED  to   report  HB  337  out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
HB 337 was REPORTED out of committee with a "do pass"                                                                           
recommendation and with one previously published fiscal                                                                         
impact note: FN1 (CED).                                                                                                         
                                                                                                                                
Co-Chair Thomas discussed the committee schedule for the                                                                        
following day.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
3:02:10 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:02 PM.                                                                                           
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
HB221 Sponsor Statement.pdf HFIN 3/20/2012 1:30:00 PM
HB 221
HB221 Sectional Analysis.pdf HFIN 3/20/2012 1:30:00 PM
HB 221
HB221 Court Rule 39.1.pdf HFIN 3/20/2012 1:30:00 PM
HB 221
HB221 AS 18.85.120.docx HFIN 3/20/2012 1:30:00 PM
HB 221
HB358 CS WORKDRAFT 27-LS1406-I.pdf HFIN 3/20/2012 1:30:00 PM
HB 358
HB196 CS WORKDRAFT 27-LS0529-I.pdf HFIN 3/20/2012 1:30:00 PM
HB 196
HB196 NEW FN-FIN-CED AEA 3.20.12pdf.pdf HFIN 3/20/2012 1:30:00 PM
HB 196
HB 196 NEW FN FIN CED INVESTMENTS 3.20.12pfd.1.pdf HFIN 3/20/2012 1:30:00 PM
HB 196
HB 196 NEW FN FIN CED CRA 3.20.12pfd.1.pdf HFIN 3/20/2012 1:30:00 PM
HB 196
3 20 12 Summary of HB196 NEW Fiscal Notes.doc HFIN 3/20/2012 1:30:00 PM
HB 196
HB196 NEW FN-FIN-CED AEA 3.20.12pdf.pdf HFIN 3/20/2012 1:30:00 PM
HB 196
3 20 12 Summary of HB196 NEW Fiscal Notes.doc HFIN 3/20/2012 1:30:00 PM
HB 196