Legislature(2013 - 2014)HOUSE FINANCE 519

03/18/2014 08:30 AM FINANCE


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08:33:05 AM Start
08:33:14 AM HB305
09:28:37 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 305 JUNK DEALER & METAL SCRAPPER LICENSING TELECONFERENCED
Heard & Held
+= HB 306 EVAL. INDIRECT EXPENDITURES; TAX CREDITS TELECONFERENCED
Scheduled But Not Heard
+ Bills Previously Heard/Scheduled TELECONFERENCED
                  HOUSE FINANCE COMMITTEE                                                                                       
                      March 18, 2014                                                                                            
                         8:33 a.m.                                                                                              
                                                                                                                                
8:33:05 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stoltze called the  House Finance Committee meeting                                                                    
to order at 8:33 a.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Alan Austerman, Co-Chair                                                                                         
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Mark Neuman, Vice-Chair                                                                                          
Representative Mia Costello                                                                                                     
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative David Guttenberg                                                                                                 
Representative Lindsey Holmes                                                                                                   
Representative Cathy Munoz                                                                                                      
Representative Steve Thompson                                                                                                   
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Daniel George,  Staff, Representative Bill  Stoltze; Speaker                                                                    
Mike  Chenault, Sponsor;  Tom Wright,  Staff, Representative                                                                    
Chenault; Anne Carpeneti,  Assistant Attorney General, Legal                                                                    
Services  Section-Juneau, Criminal  Division, Department  of                                                                    
Law;  Don  Habeger,   Director,  Division  of  Corporations,                                                                    
Business   and   Professional   Licensing,   Department   of                                                                    
Commerce, Community and Economic Development.                                                                                   
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Phil  Steyer,  Director  Of  Government  Relations,  Chugach                                                                    
Electric,  Anchorage;  John MacKinnon,  Executive  Director,                                                                    
Associated General Contractors  of Alaska, Anchorage; Louise                                                                    
Bray,  Schnitzer Steel  Industries, Anchorage;  Nic Ballard,                                                                    
General  Manager,  Schnitzer  Steel  Industries,  Anchorage;                                                                    
Matt Fonder, Department of Revenue, Anchorage.                                                                                  
SUMMARY                                                                                                                       
                                                                                                                                
HB 305    JUNK DEALER & METAL SCRAPPER LICENSING                                                                                
                                                                                                                                
          HB 305 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HB 306    EVAL. INDIRECT EXPENDITURES; TAX CREDITS                                                                              
                                                                                                                                
          HB 306 was SCHEDULED but not HEARD.                                                                                   
                                                                                                                                
HOUSE BILL NO. 305                                                                                                            
                                                                                                                                
     "An Act repealing the requirement that a junk dealer                                                                       
     or metal scrapper obtain a license."                                                                                       
                                                                                                                                
8:33:14 AM                                                                                                                    
                                                                                                                                
Representative   Costello  MOVED   to  ADOPT   the  proposed                                                                    
committee  substitute for  HB  305,  Work Draft  28-LS1449\P                                                                    
(Bannister, 3/17/14).                                                                                                           
                                                                                                                                
Co-Chair Stoltze OBJECTED for discussion.                                                                                       
                                                                                                                                
DANIEL   GEORGE,   STAFF,   REPRESENTATIVE   BILL   STOLTZE,                                                                    
discussed the  changes in the committee  substitute (CS). He                                                                    
explained  that the  title had  expanded  from the  previous                                                                    
version. He read the title as follows:                                                                                          
                                                                                                                                
     "An  act relating  to the  records of  metal scrappers;                                                                    
     relating  to   the  crime  of  criminal   mischief  for                                                                    
     removing   metal    from   property;    repealing   the                                                                    
     requirement  that  a  junk  dealer  or  metal  scrapper                                                                    
     obtain  a  license;  and  providing  for  an  effective                                                                    
     date."                                                                                                                     
                                                                                                                                
Mr.  George presented  a sectional  analysis. He  explicated                                                                    
that  Section 1  established new  recordkeeping requirements                                                                    
for  the sale  of  scrap metals.  The  dealer must  maintain                                                                    
accurate paper or electronic records  for each sale of scrap                                                                    
meatal  of  $100.  or  more  and  include  the  date,  time,                                                                    
location,  and  value  of the  scrap  metal  purchased;  the                                                                    
sellers  driver's  license  number, description  of  vehicle                                                                    
delivering the  metal, including  the license  plate number;                                                                    
business  license  number,   if  applicable,  a  description                                                                    
including weight and  quantity of scrap metal;  and a signed                                                                    
statement that the scrap metal  was not stolen property. The                                                                    
records  must  be made  available  to  law enforcement.  The                                                                    
dealer was required to maintain the records for five years.                                                                     
He  added  that  the  CS provided  and  exemption  from  the                                                                    
recording  requirements  with  a  valid  tax  identification                                                                    
number or government issued  photo identification for volume                                                                    
transactions. A  dealer that failed  to comply  or falsified                                                                    
record entries  would be  guilty of  a class  A misdemeanor.                                                                    
He stated that the list was  developed by a working group of                                                                    
contractors,  utility  companies,  and scrap  metal  dealers                                                                    
following a review of other states' laws.                                                                                       
                                                                                                                                
Mr.   George  continued   that   the   CS  established   new                                                                    
definitions  for  "dealer,"  "record,"  and  "scrap  metal,"                                                                    
"scrap  metal dealer,"  and  "transaction"  for purposes  of                                                                    
Section  1. He  moved to  Section  2 and  detailed that  the                                                                    
section amended the crime of  criminal mischief in the third                                                                    
degree, which added a new subsection (4) that read:                                                                             
                                                                                                                                
     …"with the  intent to deprive  another of the  metal or                                                                    
     to appropriate  the metal  of another  to oneself  or a                                                                    
     third  person,  the  person removes  from  property  of                                                                    
     another  metal  that  is  physically  attached  to  the                                                                    
     property, and  the removal damages  the property  in an                                                                    
     amount of $500 or more."                                                                                                   
                                                                                                                                
Mr. George reported that Section  3 repealed the annual junk                                                                    
and  scrap  metal license  from  the  Department of  Revenue                                                                    
(DOR). Section  4 clarified that  the criminal  penalties in                                                                    
Section 3  applied to crimes  occurring after  the effective                                                                    
date  of  January  1,  2015. He  concluded  that  Section  5                                                                    
designated  January 1,  2015 as  the effective  date of  the                                                                    
act.                                                                                                                            
                                                                                                                                
SPEAKER MIKE CHENAULT, SPONSOR,  specified that the original                                                                    
bill was simply  a repealer dealing with  licensing that was                                                                    
no longer  used by DOR.  He noted  that he was  contacted by                                                                    
utility  companies and  other corporations  that had  copper                                                                    
and other precious  metals stolen from their  work sites and                                                                    
turned into  scrap metal. He  stated that some types  of the                                                                    
metal were  expensive and  sought after  by thieves.  If the                                                                    
original  item  that  contained the  metal  was  altered  or                                                                    
destroyed  in  the  extraction  process  the  value  of  the                                                                    
original item  was reduced.  The law  would deter  the theft                                                                    
and  assisted  law  enforcement  in  detaining  scrap  metal                                                                    
thieves. He concurred with the changes.                                                                                         
                                                                                                                                
Co-Chair  Austerman  expressed  concerns that  the  required                                                                    
reporting was onerous for the  dealer. He stated that he had                                                                    
a problem with the bill but was open to discussion.                                                                             
                                                                                                                                
Speaker  Chenault  maintained  that  reporting  requirements                                                                    
were  similar  for  pawn  shops   and  protected  pawn  shop                                                                    
operators. He elucidated that stolen  property found in pawn                                                                    
shops was confiscated resulting in  a loss for the pawn shop                                                                    
owner  who  purchased  the  property.   He  found  that  the                                                                    
recording requirements  for pawn shops were  an "unfortunate                                                                    
side  of doing  business." He  emphasized that  the law  was                                                                    
designed  to protect  the business  owner  and ensured  that                                                                    
what the owner purchased provided a monetary return.                                                                            
                                                                                                                                
8:43:12 AM                                                                                                                    
                                                                                                                                
Representative  Wilson  concurred with  Co-Chair  Austerman.                                                                    
She observed that  the scrap or junk yard  businesses in the                                                                    
Fairbanks   were   small.   She  favored   fewer   reporting                                                                    
requirements.  She felt  that  anyone  currently dealing  or                                                                    
selling scrap  metal legally was conducting  honest business                                                                    
and the problem was with  selling scrap metal illegally. She                                                                    
wondered how  the bill would assist  in apprehending illegal                                                                    
sales of scrap metal.                                                                                                           
                                                                                                                                
TOM WRIGHT,  STAFF, REPRESENTATIVE CHENAULT, referred  to an                                                                    
owner of  a scrap and junk  metal dealer to best  answer the                                                                    
question.                                                                                                                       
                                                                                                                                
Representative  Wilson wanted  to avoid  over-regulating the                                                                    
dealers  operating  legally  in  order  to  prevent  illegal                                                                    
actors.                                                                                                                         
                                                                                                                                
Representative  Costello stated  that she  had a  friend who                                                                    
created art work out of scrap  metal. She cited page 4, line                                                                    
3 of the  CS and read the words "with  the intent to deprive                                                                    
another."  She wondered  whether  the  provision applied  to                                                                    
stolen art created from scrap metal.                                                                                            
                                                                                                                                
Mr. Wright  guessed that stolen  art might be  covered under                                                                    
other  statutes   and  was  uncertain  whether   the  bill's                                                                    
provisions applied to the scenario.                                                                                             
                                                                                                                                
Vice-Chair  Neuman echoed  Co-Chair Austerman's  sentiments.                                                                    
He reported that he was working  on a pawn shop issue in his                                                                    
district  regarding  reporting  requirements  and  a  stolen                                                                    
item.  An  item discovered  to  be  stolen lead  to  onerous                                                                    
consequences for the pawn shop  owner. He had a problem with                                                                    
burdening "good  hardworking Alaskans" or taking  away their                                                                    
rights.                                                                                                                         
                                                                                                                                
Vice-Chair  Neuman  asked  for clarification  regarding  the                                                                    
crime for stealing scrap metal.                                                                                                 
                                                                                                                                
Co-Chair  Stoltze interjected  that  the  Department of  Law                                                                    
(DOL) would best answer the question.                                                                                           
                                                                                                                                
Speaker  Chenault  restated   that  some  scrapyard  dealers                                                                    
already  filled   out  forms  similar  to   pawn  shops.  He                                                                    
understood that  new laws were burdensome  to new businesses                                                                    
but   he  believed   that  the   value   of  the   reporting                                                                    
requirements  protected the  scrapyard dealer  from thieves.                                                                    
He reiterated that if scrap  metal was confiscated the money                                                                    
paid  by  the  scrapper  was   lost.  He  thought  that  the                                                                    
requirements were  more helpful  in protecting  the business                                                                    
owner than they were burdensome.                                                                                                
                                                                                                                                
Co-Chair Stoltze stated  that one concept of  the issue that                                                                    
was overlooked was  the damage caused by the  removal of the                                                                    
metal. The  cost of the  damage could "far exceed  the value                                                                    
of  the  scrap  metal."  He understood  the  burden  of  the                                                                    
recording requirements  but current law did  not "adequately                                                                    
recognize" the damage  from the removal of  copper wire from                                                                    
walls or  other destruction  to personal property  caused by                                                                    
the metal removal.                                                                                                              
                                                                                                                                
Speaker  Chenault replied  that scrap  metal theft  not only                                                                    
affected individuals but consumers  as well. He hypothesized                                                                    
a  situation where  copper wire  was stolen  from a  utility                                                                    
company;  the consumers  ultimately would  pay the  cost. He                                                                    
reiterated that  the provision protected owners  of precious                                                                    
metals and scrap dealers.                                                                                                       
                                                                                                                                
Representative Holmes  supported the bill. She  relayed that                                                                    
she  had heard  of the  problem from  utility companies  and                                                                    
contractors in  her district and  statewide. She  added that                                                                    
when metals were stolen,  construction projects were delayed                                                                    
or halted  and utility  service were interrupted.  She cited                                                                    
the document  from the bill packet  titled: "Recycling Today                                                                    
Scrap Metal Theft Guide" (copy  on file) and noted that many                                                                    
states  required much  more information  for record  keeping                                                                    
including fingerprinting  and photographs. She  relayed that                                                                    
Alaska was one  of two states that had  no requirements. She                                                                    
did not  want to burden  small businesses but  believed that                                                                    
metal  theft was  placing a  "huge  burden" on  contractors,                                                                    
utility  companies, and  the public.  She  thought that  the                                                                    
problem was well documented.                                                                                                    
                                                                                                                                
Representative   Edgmon    echoed   Representative   Holmes'                                                                    
comments.  He shared  that the  way to  profit when  selling                                                                    
copper was  in selling  large quantities of  several hundred                                                                    
pounds for each sale. He  knew a legal scrap metal collector                                                                    
who  informed  him  that the  business  "attracted  unsavory                                                                    
characters" and that the  illegal activity was "underground"                                                                    
with  large sums  of money  was involved.  He supported  the                                                                    
restrictions.                                                                                                                   
                                                                                                                                
8:55:41 AM                                                                                                                    
                                                                                                                                
Representative Thompson  supported the  CS. He  offered that                                                                    
contractors  had materials  stolen from  their business  and                                                                    
job sites.  He believed  that people wanted  law enforcement                                                                    
to  apprehend the  thieves who  stole it  so collecting  the                                                                    
information  on  the  form   was  necessary  to  corroborate                                                                    
accurate information.                                                                                                           
                                                                                                                                
Representative  Gara  stated   that  the  utility  companies                                                                    
contacted him about  the problem and he  understood the need                                                                    
for  the   legislation.  He  expressed   concerns  regarding                                                                    
turning  another misdemeanor  into a  felony. He  pointed to                                                                    
page  3, lines  21  to 22  and read;  "…with  the intent  to                                                                    
damage property  of another, the person  damages property of                                                                    
another in an  amount of $500 or more." He  thought that the                                                                    
value of  the metal stolen  was the critical amount  for the                                                                    
prosecutor to  determine the  charges and  not based  on the                                                                    
amount  of the  sale to  the pawn  shop dealer.  He wondered                                                                    
whether the criminal  provision in the CS  was necessary and                                                                    
whether the crime  should be turned from  a misdemeanor into                                                                    
a felony.                                                                                                                       
                                                                                                                                
Mr. Wright  stated that  Anne Carpeneti,  Assistant Attorney                                                                    
General, Legal  Services Section-Juneau,  Criminal Division,                                                                    
and (DOL) was available to answer legal questions.                                                                              
                                                                                                                                
Co-Chair Stoltze OPENED public testimony.                                                                                       
                                                                                                                                
PHIL  STEYER,  DIRECTOR  OF  GOVERNMENT  RELATIONS,  CHUGACH                                                                    
ELECTRIC, ANCHORAGE (via  teleconference), supported the CS.                                                                    
He  stated that  he  worked with  a  number of  contractors,                                                                    
other  utility   companies,  and  scrap  metal   dealers  in                                                                    
consultation with  law enforcement  to shape  the provisions                                                                    
in  the CS.  He noted  that the  group examined  other state                                                                    
laws as guidance  in crafting the legislation.  He urged the                                                                    
committee to support the legislation.                                                                                           
                                                                                                                                
JOHN  MACKINNON,  EXECUTIVE   DIRECTOR,  ASSOCIATED  GENERAL                                                                    
CONTRACTORS  OF  ALASKA,   ANCHORAGE  (via  teleconference),                                                                    
favored the CS. He reported  that very expensive copper wire                                                                    
thefts took place  at remote project sites.  He relayed that                                                                    
Alaska was  the only state that  did not have a  law related                                                                    
to  the  issue.  He  gathered  together  utility  companies,                                                                    
contractors, and other  "stakeholders" to work cooperatively                                                                    
in   crafting  the   legislation.   The  provisions   proved                                                                    
successful in  reducing theft when enacted  in other states.                                                                    
The  recording was  not overly  burdensome and  many of  the                                                                    
scrap dealers  were already  collecting the  information. He                                                                    
believed the  requirements were an "effective  tool" for law                                                                    
enforcement to apprehend the criminals.                                                                                         
                                                                                                                                
Co-Chair   Austerman   offered  that   smaller   communities                                                                    
struggled  to  get rid  of  scrap  metal.  He asked  if  the                                                                    
problem  occurred  primarily on  the  road  system or  state                                                                    
wide.                                                                                                                           
                                                                                                                                
Mr. MacKinnon replied that the  problem occurred among rural                                                                    
utilities  especially the  theft of  copper wire  from rural                                                                    
utility  companies. He  stated that  the copper  wire stolen                                                                    
from transformers  and other  apparatus posed  a significant                                                                    
public safety hazard causing shock or electrocution.                                                                            
                                                                                                                                
Co-Chair  Austerman remarked  that the  bill would  not stop                                                                    
the metal theft.                                                                                                                
                                                                                                                                
Mr.  MacKinnon added  that small  incidental sales  were not                                                                    
affected  by the  bill. Much  of  the scrap  metal in  rural                                                                    
Alaska  were comprised  of large  pieces of  iron therefore,                                                                    
ferrous  metals  were  exempted.  Aluminum  cans  were  also                                                                    
exempted.  The legislation  targeted the  scrap metals  with                                                                    
the  highest  values.  Most  of the  metal  theft  was  drug                                                                    
related because the  price for copper was  high. He restated                                                                    
that the law was effective in other states.                                                                                     
                                                                                                                                
Representative Wilson  stated that  people could  have scrap                                                                    
metal on their own property  or collect scrap metal and sell                                                                    
directly to  a contractor.  She wondered  how the  law would                                                                    
catch thieves when  it was currently possible  to sell scrap                                                                    
metal without using a scrap metal dealer.                                                                                       
                                                                                                                                
Mr. MacKinnon answered that currently  laws did not exist to                                                                    
prosecute scrap  metal sellers operating on  the "margins of                                                                    
the business."   The bill  gave law enforcement  the "tools"                                                                    
to enforce the law and reduce scrap metal theft.                                                                                
                                                                                                                                
Representative Wilson  believed that the CS  was "penalizing                                                                    
the wrong people."                                                                                                              
                                                                                                                                
9:05:56 AM                                                                                                                    
                                                                                                                                
LOUISE  BRAY,  SCHNITZER  STEEL INDUSTRIES,  ANCHORAGE  (via                                                                    
teleconference),  testified  in  favor   of  the  bill.  She                                                                    
elaborated  that  Schnitzer  Steel   Industry  was  a  large                                                                    
publicly traded  company with a  facility in  Anchorage. The                                                                    
industry  was comprised  of very  small to  large operators.                                                                    
She  believed  that  basic record  keeping  facilitated  the                                                                    
removal of "bad  actors" from the scrap  metal business. The                                                                    
industry  did not  want its  reputation  tainted by  dealers                                                                    
operating  illegally and  purchasing  stolen materials.  She                                                                    
noted that  the basic  record keeping requirements  were not                                                                    
overly burdensome.  She worked  closely with  Alaska General                                                                    
Contractors  (AGC) and  utility  companies to  craft a  bill                                                                    
that was not  onerous to the dealers and was  a tool for law                                                                    
enforcement. She  believed the CS leveled  the playing field                                                                    
for legal participants in the industry.                                                                                         
                                                                                                                                
NIC  BALLARD, GENERAL  MANAGER, SCHNITZER  STEEL INDUSTRIES,                                                                    
ANCHORAGE (via teleconference), testified  in support of the                                                                    
legislation  and  concurred   with  previous  testimony.  He                                                                    
clarified  that  scrap  metals  were  required  to  be  sold                                                                    
through a dealer to get to market or an end user.                                                                               
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
ANNE CARPENETI,  ASSISTANT ATTORNEY GENERAL,  LEGAL SERVICES                                                                    
SECTION-JUNEAU,  CRIMINAL   DIVISION,  DEPARTMENT   OF  LAW,                                                                    
commented on  the CS. She cited  page 4, lines 3  through 6.                                                                    
She related  that the provision  took two crimes,  one being                                                                    
theft and the  other criminal mischief and  turned them into                                                                    
one  crime.   She  perceived  that   there  would   be  less                                                                    
flexibility  when  prosecuting  the crimes.  She  elucidated                                                                    
that  two separate  societal interests  were  at issue;  one                                                                    
regarding  theft   of  personal   property  and   the  other                                                                    
concerned harming personal  property. The department thought                                                                    
the provision was "puzzling."                                                                                                   
                                                                                                                                
Representative  Thompson hypothesized  a  scenario where  an                                                                    
empty  house for  sale was  damaged  in the  process of  the                                                                    
illegal extraction  of copper.  He asked whether  two crimes                                                                    
were committed.                                                                                                                 
                                                                                                                                
Ms. Carpeneti  replied in the  affirmative. She  stated that                                                                    
the combined crimes  would require the use of  the new crime                                                                    
in the CS  instead of prosecuting based on  both the general                                                                    
crimes of theft and criminal mischief.                                                                                          
                                                                                                                                
Co-Chair  Austerman observed  that the  CS was  implementing                                                                    
new criminal  laws without requiring  that the  dealers were                                                                    
licensed. He  wondered how the  scrap metal  businesses were                                                                    
tracked.                                                                                                                        
                                                                                                                                
9:11:55 AM                                                                                                                    
                                                                                                                                
MATT FONDER, DIRECTOR, TAX  DIVISION, DEPARTMENT OF REVENUE,                                                                    
ANCHORAGE  (via teleconference),  replied that  DOR searched                                                                    
prior decades  revenue records and  was unable to find   any                                                                    
revenue  reporting from  junk yard  or  scrap metal  dealers                                                                    
from past  licenses issued. Currently, the  state was unable                                                                    
to  track  any  scrap  dealer businesses.  He  thought  that                                                                    
requiring a license was sensible  especially in light of the                                                                    
fact  that all  of the  other businesses  in the  state were                                                                    
required to operate under a license.                                                                                            
                                                                                                                                
Representative  Wilson  understood  that the  Department  of                                                                    
Commerce, Community and  Economic Development (DCCED) issued                                                                    
licenses  and  dealers were  required  to  be licensed.  She                                                                    
asked whether  existing laws applied  to scrap  metal crimes                                                                    
without passage of the legislation.                                                                                             
                                                                                                                                
Ms. Carpeneti answered in the  affirmative and restated that                                                                    
the crimes that applied were theft and criminal mischief.                                                                       
                                                                                                                                
Representative Wilson  supported the  idea of  requiring the                                                                    
dealer to check a  driver's license for personal information                                                                    
verification. She  asked whether the dealer  was required to                                                                    
lock  up   the  personal  information  collected   from  the                                                                    
sellers.                                                                                                                        
                                                                                                                                
Ms.  Carpeneti replied  that the  legislation required  that                                                                    
the information  in electronic  or paper  form needed  to be                                                                    
stored for a period of five  years. She did not know whether                                                                    
the bill addressed the security of the information.                                                                             
                                                                                                                                
Representative  Wilson expressed  concern over  the dealer's                                                                    
storage  of   personal  information.  She  asked   if  other                                                                    
businesses,  besides pawn  shops  were  subjected to  record                                                                    
inspection by  law enforcement without a  warrant or advance                                                                    
warning.                                                                                                                        
                                                                                                                                
Ms. Carpeneti  offered to  provide further  information. She                                                                    
was only aware of records inspection for pawn shops.                                                                            
                                                                                                                                
Representative  Holmes confirmed  that  scrap metal  dealers                                                                    
were licensed  under DCCED. She  asked questions  related to                                                                    
Subsection  4  and  its  duplicative  nature.  She  wondered                                                                    
whether the  existing statutes covered all  of the different                                                                    
scenarios under which scrap metal could be stolen.                                                                              
                                                                                                                                
Ms. Carpeneti  responded that  a definitive  answer depended                                                                    
on  the  facts  of  the  crime but  felt  that  current  law                                                                    
provided  adequate coverage  at the  same level  of offense.                                                                    
Under current law  property damage or theft of  $500 or more                                                                    
was a  class C felony of  theft or criminal mischief  in the                                                                    
third degree.  She reiterated that  except for  laws dealing                                                                    
with  a culpable  mental state  if applicable,  current laws                                                                    
adequately covered the crimes.                                                                                                  
                                                                                                                                
Representative Holmes  cited page  3, lines  21 to  22 "with                                                                    
the  intent  to  damage  property  of  another,  the  person                                                                    
damages property of another…." She  referred to the words in                                                                    
the new subsection 4 "with  the intent to deprive another of                                                                    
the  metal…."  She  wondered  whether  the  thief  could  be                                                                    
prosecuted under subsection  1, if the intent  was to steal,                                                                    
but not necessarily damage  property (criminal mischief) and                                                                    
the copper wire was worth  less than $500. She asked whether                                                                    
the new subsection was necessary.                                                                                               
                                                                                                                                
Ms. Carpeneti  replied that she  maintained doubt  about the                                                                    
current  statutes   covering  culpable  mental   states  and                                                                    
suggested   possible  changes   in  the   section  regarding                                                                    
culpable  mental  states.  She   remarked  that  adding  the                                                                    
specific  theft  provision  prevented  the  prosecutor  from                                                                    
pressing  charges  for  two  crimes  and  made  the  charges                                                                    
"harder to prove."                                                                                                              
                                                                                                                                
Representative Holmes suggested additional work on the CS.                                                                      
                                                                                                                                
Co-Chair  Stoltze apologized  that the  members did  not see                                                                    
the CS  in advance. He  thought that the legislation  was "a                                                                    
good vehicle" to  address the issue but he  wanted to ensure                                                                    
the issue  was properly addressed.  He stated that  he would                                                                    
hold the bill.                                                                                                                  
                                                                                                                                
Ms. Carpeneti  shared that she had  heard concerns expressed                                                                    
over the  ability to get  restitution for damages  caused by                                                                    
metal theft. She suggested  examining the statutes regarding                                                                    
restitution  to determine  whether they  could be  made more                                                                    
specific for the crime.                                                                                                         
                                                                                                                                
Representative  Gara asked  what the  threshold that  turned                                                                    
theft into a felony was                                                                                                         
                                                                                                                                
Ms. Carpeneti answered that the amount was $500.                                                                                
                                                                                                                                
Representative  Gara pondered  whether  a theft  of a  $5000                                                                    
role of copper  wire that was sold for scrap  metal for $499                                                                    
was a felony theft.                                                                                                             
                                                                                                                                
Ms. Carpeneti responded in the affirmative.                                                                                     
                                                                                                                                
Representative Gara asked  whether criminal mischief charges                                                                    
applied to any  damage over $500 that was  caused to extract                                                                    
the metal out of a facility.                                                                                                    
                                                                                                                                
Ms. Carpeneti replied in the  affirmative. The damages would                                                                    
be charged as a felony if the damage was over $500.                                                                             
                                                                                                                                
9:23:23 AM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze  surmised that the metal  theft crimes were                                                                    
currently being prosecuted as felonies.                                                                                         
                                                                                                                                
Ms.  Carpeneti replied  in  the  affirmative. She  qualified                                                                    
that it depended on the facts.                                                                                                  
                                                                                                                                
Co-Chair Austerman  commented that he had  concerns with the                                                                    
bill. He understood  the purpose of the  legislation but was                                                                    
concerned the  CS would affect small  communities with small                                                                    
businesses attempting  to clean  up and remove  scrap metal.                                                                    
He  stated that  in Kodiak  it was  difficult to  move scrap                                                                    
metal out of the community.                                                                                                     
                                                                                                                                
Representative  Holmes  asked  whether scrap  metal  dealers                                                                    
were licensed as a business through DCCED.                                                                                      
                                                                                                                                
DON  HABEGER, DIRECTOR,  DIVISION OF  CORPORATIONS, BUSINESS                                                                    
AND   PROFESSIONAL   LICENSING,  DEPARTMENT   OF   COMMERCE,                                                                    
COMMUNITY AND ECONOMIC DEVELOPMENT, responded that a                                                                            
business license was required for scrap metal dealers.                                                                          
                                                                                                                                
HB 305 was HEARD and HELD in committee for further                                                                              
consideration.                                                                                                                  
                                                                                                                                
HB 306 was SCHEDULED but not HEARD.                                                                                             
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
9:28:37 AM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 9:28 a.m.                                                                                          

Document Name Date/Time Subjects
HB 306 House Finance Members QA part2.pdf HFIN 3/18/2014 8:30:00 AM
HB 306
HB 305 Sponsor Statement-CSHB 305(FIN).pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 Scrap Metal Media.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 Scrap Metal Laws State by State.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 Support.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 Sectional Analysis-P CSHB 305(FIN).pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 CS WORKDRAFT FIN P-VERSION.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 SAMPLE TICKET.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB 305 CS APAsupport.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HB305 - Metal Theft Legislation.pdf.pdf HFIN 3/18/2014 8:30:00 AM
HB 305
HJR 18 Explanation of Changes.pdf HFIN 3/18/2014 8:30:00 AM
HJR 18
HJR 18 CS WORKDRAFT FIN N version.pdf HFIN 3/18/2014 8:30:00 AM
HJR 18