Legislature(2017 - 2018)ADAMS ROOM 519

03/28/2018 01:30 PM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 219 CRIM HIST CHECK: ST EMPLOYEES/CONTRACTORS TELECONFERENCED
Heard & Held
-- Public Testimony --
+ HB 386 VESSELS: REGISTRATION/TITLES; DERELICTS TELECONFERENCED
Heard & Held
+= HB 217 RAW MILK SALES; FOOD EXEMPT FROM REGS TELECONFERENCED
Heard & Held
-- Public Testimony --
+ HJR 29 REAUTHORIZE SECURE RURAL SCHOOLS ACT TELECONFERENCED
Moved CSHJR 29(FIN) Out of Committee
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
                   HOUSE FINANCE COMMITTEE                                                                                      
                       March 28, 2018                                                                                           
                          1:31 p.m.                                                                                             
                                                                                                                                
1:31:59 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Foster  called the House Finance  Committee meeting                                                                    
to order at 1:31 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Neal Foster, Co-Chair                                                                                            
Representative Paul Seaton, Co-Chair                                                                                            
Representative Les Gara, Vice-Chair                                                                                             
Representative Jason Grenn                                                                                                      
Representative David Guttenberg                                                                                                 
Representative Scott Kawasaki                                                                                                   
Representative Dan Ortiz                                                                                                        
Representative Lance Pruitt                                                                                                     
Representative Steve Thompson                                                                                                   
Representative Cathy Tilton                                                                                                     
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Brandon   S.   Spanos,   Deputy  Director,   Tax   Division,                                                                    
Department of  Revenue; Representative Geran  Tarr, Sponsor;                                                                    
Representative  George  Rauscher, Sponsor;  Darrell  Breese,                                                                    
Staff,  Representative  George Rauscher;  Kathie  Wasserman,                                                                    
Executive Director, Alaska  Municipal League; Representative                                                                    
Paul  Seaton,  Sponsor; Patricia  Nickell-Zimmerman,  Staff,                                                                    
Representative Paul Seaton.                                                                                                     
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Gary  Lee, Criminal  Justice Planner,  Department of  Public                                                                    
Safety; Eric  Gaffney, Records and Licensing,  Department of                                                                    
Public  Safety;  Carol  Beecher,  Director,  Division  Child                                                                    
Support  Services, Department  of Revenue;  April Wilkerson,                                                                    
Director,  Administrative Services  Division, Department  of                                                                    
Corrections;   Johanna   Herron,   Development   Specialist,                                                                    
Division  of Agriculture;  Amy Seitz,  Alaska Farm  Borough,                                                                    
Soldotna;   Robbi  Mixon,   Director,  Local   Foods,  Homer                                                                    
Farmer's  Market Association/Kenai  Peninsula and  Anchorage                                                                    
Food  Hub;   Christina  Carpenter,  Director,   Division  of                                                                    
Environmental    Health,    Department   of    Environmental                                                                    
Conservation, Anchorage; Peter  Caltagirone, Attorney, Civil                                                                    
Division, Environmental Section, Department of Law.                                                                             
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 217    RAW MILK SALES; FOOD EXEMPT FROM REGS                                                                                 
                                                                                                                                
          HB 219 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HB 219    CRIM HIST CHECK: ST EMPLOYEES/CONTRACTORS                                                                             
                                                                                                                                
          HB 219 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HB 386    VESSELS: REGISTRATION/TITLES; DERELICTS                                                                               
                                                                                                                                
          HB 386 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HJR 29    REAUTHORIZE SECURE RURAL SCHOOLS ACT                                                                                  
                                                                                                                                
          CSHJR 29(FIN) was REPORTED out of committee with                                                                      
          a   "do   pass"   recommendation  and   with   one                                                                    
          previously published zero fiscal note: FN1 (LEG).                                                                     
                                                                                                                                
HOUSE BILL NO. 219                                                                                                            
                                                                                                                                
     "An   Act   relating    to   background   investigation                                                                    
     requirements  for  state  employees  whose  job  duties                                                                    
     require  access  to  certain federal  tax  information;                                                                    
     relating to persons under contract  with the state with                                                                    
     access    to   certain    federal   tax    information;                                                                    
     establishing  state personnel  procedures required  for                                                                    
     employee  access to  certain  federal tax  information;                                                                    
     and providing for an effective date."                                                                                      
                                                                                                                                
1:33:04 PM                                                                                                                    
                                                                                                                                
BRANDON S. SPANOS, DEPUTY DIRECTOR, TAX DIVISION,                                                                               
DEPARTMENT OF REVENUE, introduced the legislation. He read                                                                      
from a sectional analysis (copy on file):                                                                                       
                                                                                                                                
     Section 1                                                                                                                  
     Amends AS 12.62.400 by adding a new subsection.                                                                            
     This will require an agency  to submit the fingerprints                                                                    
     of  current  or  prospective employees  or  contractors                                                                    
     whose  job   duties  require  access  to   federal  tax                                                                    
     information   (defined   in  AS   39.55.015(e)(3)   and                                                                    
     36.30.960(d)(3))  to the  Department  of Public  Safety                                                                    
     for submission  to the Federal Bureau  of Investigation                                                                    
     to obtain a criminal  history record. Defines "agency",                                                                    
     "employee" and "contractor".                                                                                               
                                                                                                                                
     Section 2                                                                                                                  
     Amends AS 36.30 by adding a new section.                                                                                   
     This  section  establishes state  personnel  procedures                                                                    
     for obtaining  and submitting fingerprints  for current                                                                    
     or  prospective  contractors  if a  contract  with  the                                                                    
     state  requires  access  to  federal  tax  information.                                                                    
     Defines   "agency",  "contractor"   and  "federal   tax                                                                    
     information".                                                                                                              
                                                                                                                                
     Section 3                                                                                                                  
     Amends AS 39 by adding a new chapter.                                                                                      
     This new  chapter addresses state  personnel procedures                                                                    
     related to federal tax information.                                                                                        
     Adds AS 39.55.010                                                                                                          
     This section  explains the purpose of  the chapter-- to                                                                    
     establish   procedures   to   safeguard   federal   tax                                                                    
     information   which  will   apply  to   a  current   or                                                                    
     prospective  state employee  whose  job duties  require                                                                    
     access to federal tax information.                                                                                         
     Adds AS 39.55.015                                                                                                          
     This  section requires  current  and prospective  state                                                                    
     employees whose job duties require                                                                                         
     access   to   federal   tax  information   to   provide                                                                    
     information to an agency for a state and national                                                                          
     criminal  history   record  check.   Defines  "agency",                                                                    
     "employee",  "federal tax  information", "return",  and                                                                    
     "return information".                                                                                                      
                                                                                                                                
     Section 4                                                                                                                  
     Provides the effective date of July 1, 2018.                                                                               
                                                                                                                                
Representative  Wilson stated  that she  did not  understand                                                                    
why   the   department   and   agencies   were   doing   the                                                                    
fingerprinting  and   sending  them  in;  rather   than  the                                                                    
employee pay for the process.                                                                                                   
                                                                                                                                
Co-Chair  Foster  noted the  committee  had  been joined  by                                                                    
Representative Pruitt and Vice-Chair Gara.                                                                                      
                                                                                                                                
Mr. Spanos noted it was a  good point. He felt that it could                                                                    
be another option.                                                                                                              
                                                                                                                                
Representative Wilson  stressed that the state  did not have                                                                    
any money,  so she did  not understand why the  budget would                                                                    
be increased.  She noted that  the fiscal notes  showed that                                                                    
the  Department of  Corrections  (DOC) had  the program  for                                                                    
free. She wondered why DOC was free.                                                                                            
                                                                                                                                
Mr.  Spanos replied  that  he understood  that  DOC did  the                                                                    
program  themselves,  so  the Department  of  Public  Safety                                                                    
(DPS) would charge for the cost of the background check.                                                                        
                                                                                                                                
1:37:19 PM                                                                                                                    
                                                                                                                                
GARY  LEE, CRIMINAL  JUSTICE PLANNER,  DEPARTMENT OF  PUBLIC                                                                    
SAFETY (via teleconference), introduced himself.                                                                                
                                                                                                                                
Representative  Wilson wondered  whether DPS  had a  cost to                                                                    
the background checks.                                                                                                          
                                                                                                                                
Mr. Lee replied in the  affirmative. He stated that the cost                                                                    
was $47 for a fingerprint-based background check.                                                                               
                                                                                                                                
Representative  Wilson wondered  whether DPS  paid for  that                                                                    
cost for those  that had been accepted  into the department,                                                                    
or whether the employee paid for the cost.                                                                                      
                                                                                                                                
Mr.  Lee  answered  that  it was  generally  funded  by  the                                                                    
requesting  agency. He  stated  that  DPS did  approximately                                                                    
40,000 background checks per year for agencies.                                                                                 
                                                                                                                                
Representative Tilton  noted that  there were  some agencies                                                                    
within the  fiscal note that  stated that they  could absorb                                                                    
the costs,  and other agencies  were doing it for  free. She                                                                    
wondered  why  the  individual  paying  for  the  background                                                                    
check. She understood that the  federal government would not                                                                    
allow  the documentation  to be  available  to the  agencies                                                                    
without  the background  checks. She  queried the  agencies'                                                                    
different uses of the background checks.                                                                                        
                                                                                                                                
Mr.  Spanos   answered  that  the  Tax   Division  used  the                                                                    
information to compare corporate  tax returns to the federal                                                                    
tax return, and verify that  the information was similar. He                                                                    
stated  that  the  IRS  would   share  information  about  a                                                                    
corporation  audit. He  stated that  Child Support  Services                                                                    
used  the information  to garnish  a tax  refund. He  stated                                                                    
that  the  Department  of Labor  and  Workforce  Development                                                                    
(DOLWD)   used  the   background   check   to  verify   wage                                                                    
information for the unemployment insurance tax.                                                                                 
                                                                                                                                
Representative Guttenberg  noted that the  legislation would                                                                    
give the  state employees and contractors  access to federal                                                                    
tax information. He stressed that  the entity paying for the                                                                    
service  controlled the  service.  He  wondered whether  the                                                                    
federal government  had a requirement outlining  whether the                                                                    
state or individual  paid for the background  check, and how                                                                    
it would be processed, paid for, and shared.                                                                                    
                                                                                                                                
1:42:43 PM                                                                                                                    
                                                                                                                                
Mr.  Spanos  answered  that the  IRS  released  a  document,                                                                    
"Publication  1075", which  detailed the  state requirements                                                                    
in order to continue to  receive federal tax information. He                                                                    
stated  that  the  state  was in  compliance  with  all  the                                                                    
requirements,  except for  the fingerprinting.  He announced                                                                    
that there  was an implemented policy  on background checks,                                                                    
and those  checks were conducted  up to the  level possible.                                                                    
He stressed  that the fingerprinting required  authority. He                                                                    
stated that  the Publication  1075 the  IRS did  not specify                                                                    
who would pay for the  fingerprinting, rather it stated that                                                                    
the  states   must  conduct   background  checks   on  their                                                                    
employees.                                                                                                                      
                                                                                                                                
Representative  Kawasaki   surmised  that  the   issue  only                                                                    
applied to  state employees or contractors  who would access                                                                    
the federal tax information.                                                                                                    
                                                                                                                                
Mr. Spanos answered in the affirmative.                                                                                         
                                                                                                                                
Representative  Kawasaki asked  how many  people would  have                                                                    
access.                                                                                                                         
                                                                                                                                
Mr.  Spanos  answered  that  there  were  approximately  105                                                                    
filled positions in  the division that would  have access or                                                                    
potential  access.  He remarked  that  there  were only  six                                                                    
employees  that actually  had the  security to  go into  the                                                                    
system to view  the information. He stressed  that there was                                                                    
a possibility  to view the  information on the  computer. He                                                                    
stated that, in  Child Support Services, the  number was 250                                                                    
people, and  deferred to Ms.  Beecher for  more information.                                                                    
He restated that the number was closer to 200.                                                                                  
                                                                                                                                
Representative Kawasaki stated that  currently there were no                                                                    
criminal background checks  done in the agency.  He asked if                                                                    
it was a new requirement.                                                                                                       
                                                                                                                                
Mr. Spanos  answered that the publication  was finalized the                                                                    
year  prior. He  stated that  with the  updated publication,                                                                    
the Child  Support Division and  Tax Division created  a new                                                                    
policy  for  background  checks.  That  policy  was  already                                                                    
implemented.  He stressed  that  they had  yet to  implement                                                                    
fingerprinting   run  through   the  federal   database.  He                                                                    
explained  that it  was  the final  step  of the  background                                                                    
check.                                                                                                                          
                                                                                                                                
Representative Wilson wondered  whether the department would                                                                    
not be doing the fingerprinting.                                                                                                
                                                                                                                                
Mr. Spanos  replied that fingerprints  would be done  by the                                                                    
Department  of  Public  Safety (DPS).  He  deferred  to  Mr.                                                                    
Gaffney for more information.                                                                                                   
                                                                                                                                
Representative Wilson questioned the  details of the efforts                                                                    
of DPS.                                                                                                                         
                                                                                                                                
ERIC GAFFNEY,  RECORDS AND  LICENSING, DEPARTMENT  OF PUBLIC                                                                    
SAFETY   (via    teleconference),   responded    that   most                                                                    
fingerprinted in  Alaska for civil purposes  was done either                                                                    
by private  commercial finger printers, employers,  or local                                                                    
police agency.  He stated that  DPS usually did  not conduct                                                                    
fingerprinting  in larger  urban areas,  because there  were                                                                    
private venders  who provided that  service. He  shared that                                                                    
there  was   no  strict   rule  on   who  should   roll  the                                                                    
fingerprints.  He   remarked  that  the   fingerprints  were                                                                    
conveyed to DPS,  were scanned, and then  transmitted to the                                                                    
FBI. He remarked that the  rolling of the fingerprints was a                                                                    
different issue than processing  them for background checks.                                                                    
He stated that there was  no specific rule in Alaska, except                                                                    
for concealed  handgun permits, on  who may or  was required                                                                    
to roll those prints.                                                                                                           
                                                                                                                                
1:47:38 PM                                                                                                                    
                                                                                                                                
Representative Tilton  asked for more information  about the                                                                    
federal receipts in the fiscal note.                                                                                            
                                                                                                                                
CAROL  BEECHER, DIRECTOR,  DIVISION CHILD  SUPPORT SERVICES,                                                                    
DEPARTMENT  OF REVENUE  (via  teleconference),  asked for  a                                                                    
restatement of the question.                                                                                                    
                                                                                                                                
Representative Tilton noted that  the fiscal note showed the                                                                    
source  of  funding  from  federal  receipts.  She  wondered                                                                    
whether there  was a federal  grant with a match  that would                                                                    
help to pay for the program.                                                                                                    
                                                                                                                                
Ms. Beecher  replied that the  Child Support Division  was a                                                                    
federally matched program. She  explained that the state put                                                                    
forward 34  percent of the budget,  and was matched at  a 66                                                                    
percent rate  from the federal  government. She  shared that                                                                    
66 percent of  the cost would be bourn by  the federal match                                                                    
money.                                                                                                                          
                                                                                                                                
Representative Wilson  noted that the fiscal  note specified                                                                    
that  currently  there  was  no   cost  to  the  DOC  to  do                                                                    
background checks.  She wondered  why the  background checks                                                                    
were free.                                                                                                                      
                                                                                                                                
APRIL    WILKERSON,   DIRECTOR,    ADMINISTRATIVE   SERVICES                                                                    
DIVISION,  DEPARTMENT OF  CORRECTIONS (via  teleconference),                                                                    
stated her  understanding of the question.  She assumed that                                                                    
the  question was  asking why  DPS  did not  charge DOC  for                                                                    
processing the fingerprints.                                                                                                    
                                                                                                                                
Representative  Wilson stated  that the  fiscal note  showed                                                                    
that  the fingerprinting  was  provided,  currently, to  the                                                                    
department at  no fee. Therefore,  she assumed that  DOC was                                                                    
not charged either.                                                                                                             
                                                                                                                                
Ms. Wilkerson  replied in the  affirmative. She  stated that                                                                    
DOC currently  processed their own fingerprints,  and rolled                                                                    
fingerprints  through  the  machine. It  was  a  cooperative                                                                    
agreement in place  within the DOC facilities  in support of                                                                    
DPS. She  shared that  the DOC  would resubmit  its employee                                                                    
and  contractor backgrounds.  She  stated that  DPS did  not                                                                    
bill DOC for  the processing on the  background and criminal                                                                    
checks.                                                                                                                         
                                                                                                                                
Representative  Wilson surmised  it would  be cheaper  to go                                                                    
through DOC for everything.                                                                                                     
                                                                                                                                
Mr.   Spanos   appreciated   receiving   the   federal   tax                                                                    
information.  He stated  that  the  information helped  with                                                                    
audits  and  receive  revenue.  He  shared  that,  over  the                                                                    
previous five years, the department  had received an average                                                                    
of $2 million per year.                                                                                                         
                                                                                                                                
Co-Chair Foster OPENED and CLOSED public testimony.                                                                             
                                                                                                                                
HB  219  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
HOUSE BILL NO. 217                                                                                                            
                                                                                                                                
     "An  Act  relating  to  the   Alaska  Food,  Drug,  and                                                                    
     Cosmetic  Act;  relating  to the  sale  of  milk,  milk                                                                    
     products,  raw   milk,  and  raw  milk   products;  and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
1:52:03 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GERAN TARR,  SPONSOR, provided  a PowerPoint                                                                    
presentation titled  "House Bill 217 Alaska  Grown" (copy on                                                                    
file). She  began on  slide 2, "A  Food Freedom  Movement is                                                                    
Growing Across the United States and Locally":                                                                                  
                                                                                                                                
     First state to pass policy was Wyoming in 2015                                                                             
          "Wyoming  has   had  roaring  success[,]   and  we                                                                    
          continue   to   capitalize  on   those   aspects,"                                                                    
          Lindholm  tells  me,   "in  fact  the  Agriculture                                                                    
          committee for the State of  Wyoming will spend the                                                                    
          summer  studying  ways  to   expand  on  the  Food                                                                    
          Freedom Act."  (Wyoming State Rep.  Tyler Lindholm                                                                    
          (R))                                                                                                                  
     Bills have been considered in Utah, Maine, Colorado,                                                                       
     Virginia                                                                                                                   
          "Food Freedom  means more small  farms." (Virginia                                                                    
          Food Freedom)                                                                                                         
     Alaska Farm Bureau $5 Alaska Challenge could raise                                                                         
     $180 million for Alaska economy                                                                                            
                                                                                                                                
1:56:41 PM                                                                                                                    
                                                                                                                                
Representative  Tarr stated  that her  summary had  been the                                                                    
goal  of the  bill  starting  out. She  turned  to slide  3,                                                                    
"Supporting Alaska Grown Products":                                                                                             
                                                                                                                                
     1) Increase direct producer to consumer sales                                                                              
     2) Support entrepreneurs                                                                                                   
     3) Create more opportunities for small scale producers                                                                     
     4) Strengthen our local food systems                                                                                       
     5) Grow our local economies                                                                                                
                                                                                                                                
Representative Tarr  shared that  DEC had  agreed to  a one-                                                                    
year pilot  program. The  farmers wanted  to provide  a good                                                                    
high-quality product  and would  not knowingly  do something                                                                    
to make someone  sick. She shared that the  changes had been                                                                    
a  disappointment to  her, but  she would  not give  up. She                                                                    
read items from slide 3.                                                                                                        
                                                                                                                                
2:01:23 PM                                                                                                                    
                                                                                                                                
Representative  Tarr  stated  that the  version  before  the                                                                    
committee did  three things. She  looked at slide  4, "House                                                                    
Bill 217 Does Three Things":                                                                                                    
                                                                                                                                
     Gives farmers freedom from some civil liability for                                                                        
     farm tours                                                                                                                 
                                                                                                                                
     Gives DNR receipt authority for Alaska Grown logo                                                                          
                                                                                                                                
     Gives state, school districts and municipalities more                                                                      
     flexibility to purchase Alaska grown produce - 15                                                                          
     percent procurement differential                                                                                           
                                                                                                                                
Representative  Tarr  looked  at slide  5,  "Alaska  Farmers                                                                    
Market Sales":                                                                                                                  
                                                                                                                                
     $1.25 million: Fairbanks                                                                                                   
     $500,000: Homer                                                                                                            
     $100,000 Kodiak                                                                                                            
     $19,000: Mt. View                                                                                                          
                                                                                                                                
2:07:04 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara  asked about the  difference in the  law for                                                                    
Alaska foods between the current system and the bill.                                                                           
                                                                                                                                
Representative Tarr replied that  there were restrictions on                                                                    
what qualified as  an Alaska Grown product.  She stated that                                                                    
there   was  some   discussion  regarding   imported  foods,                                                                    
especially with livestock imports.  She remarked that in the                                                                    
livestock case, a  certain percentage of its life  had to be                                                                    
spent in  Alaska for it  to be considered Alaska  Grown. She                                                                    
remarked  that,   with  the  Alaska   Grown  logo,   it  was                                                                    
trademarked. She explained that  currently the Department of                                                                    
Natural Resources  (DNR) did not  have receipt  authority to                                                                    
collect the  money that  would come  from selling  the logo.                                                                    
She remarked that  the dollars would be  reinvested into the                                                                    
Alaska Grown program.                                                                                                           
                                                                                                                                
Representative  Wilson looked  at page  2, line  1, "to  the                                                                    
extent   practical,  the   commissioner   shall  sell   only                                                                    
merchandise produced or manufactured  in the United States?"                                                                    
She wondered whether one could  sell things not manufactured                                                                    
in the United States, and still be considered Alaska Grown.                                                                     
                                                                                                                                
Representative Tarr  replied that  it referred to  where the                                                                    
t-shirts or sweatshirts with the  Alaska Grown logo could be                                                                    
manufactured outside of the United States .                                                                                     
                                                                                                                                
Representative  Wilson  asked  who  decided  to  the  extent                                                                    
practical.                                                                                                                      
                                                                                                                                
Representative Tarr  replied the  individual was  online for                                                                    
testimony.                                                                                                                      
                                                                                                                                
JOHANNA   HERRON,   DEVELOPMENT  SPECIALIST,   DIVISION   OF                                                                    
AGRICULTURE  (via teleconference),  replied that  there were                                                                    
state  procurement  rules.  She stated  that  the  licensing                                                                    
agreements    worked    through    agriculture    non-profit                                                                    
organizations,  who  were  allowed to  receive  a  licensing                                                                    
agreement  for  merchandise  sales. She  stressed  that  the                                                                    
farmers  were in  need of  wholesale  pricing for  marketing                                                                    
materials,  and  often  were unable  to  purchase  in  small                                                                    
quantities.                                                                                                                     
                                                                                                                                
Representative Wilson gave  an example of a  t-shirt made in                                                                    
California  or   China.  She  asked   if  either   would  be                                                                    
acceptable  as long  as  the finished  product  was done  in                                                                    
Alaska.                                                                                                                         
                                                                                                                                
Ms. Herron answered  that the effort was  usually doing what                                                                    
they could to get the best price.                                                                                               
                                                                                                                                
2:12:09 PM                                                                                                                    
                                                                                                                                
Representative    Guttenberg    asked   about    procurement                                                                    
requirements under the bill.                                                                                                    
                                                                                                                                
Ms. Herron  replied that the department  was only interested                                                                    
at  the  current  stage,  so the  merchandising  was  not  a                                                                    
current focus.  She did not  believe they would  change from                                                                    
the system currently.                                                                                                           
                                                                                                                                
Representative Guttenberg  was trying  to divide  the things                                                                    
the department  was contracted  out to  do, and  whether DNR                                                                    
was  given  receipt  authority. He  wondered  whether  money                                                                    
would come back into the program for sales of merchandise.                                                                      
                                                                                                                                
Ms.  Herron responded  that the  licensing agreements  would                                                                    
still  operate  through  their offices.  She  stressed  that                                                                    
nothing would  change with the way  its operating agreements                                                                    
were done.                                                                                                                      
                                                                                                                                
2:16:08 PM                                                                                                                    
                                                                                                                                
Representative  Guttenberg  stated  he had  gone  through  a                                                                    
lengthy  regulatory  review about  milk.  He  asked if  that                                                                    
program was in place.                                                                                                           
                                                                                                                                
Representative Tarr answered that  the cow share program was                                                                    
still in place.  She shared that it was  limiting in nature,                                                                    
but the  goal was to put  together a working group  to bring                                                                    
all of  the stakeholders together. Another  question was how                                                                    
people would be contacted if there was an illness outbreak.                                                                     
                                                                                                                                
Representative  Guttenberg  thanked  her for  the  bill.  He                                                                    
believed Alaska  needed to establish a  stronger foothold on                                                                    
food security in state.                                                                                                         
                                                                                                                                
Representative Tarr  answered that  the program  would bring                                                                    
$188 million into  the economy. She asked for  a reminder of                                                                    
the remainder of the question.                                                                                                  
                                                                                                                                
Representative Guttenberg complied.                                                                                             
                                                                                                                                
Representative Tarr stated that  the Farm Bureau was working                                                                    
with her office, and the expected fiscal impact was zero.                                                                       
                                                                                                                                
2:21:07 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton asked about the  third bullet on the sponsor                                                                    
statement.  He thought  the  statement may  have  been to  a                                                                    
previous bill draft. He wondered about the word "shall."                                                                        
                                                                                                                                
Representative  Tarr  answered   that  the  current  statute                                                                    
included the language  "shall" and that the  15 percent gave                                                                    
more flexibility in procurement rules.                                                                                          
                                                                                                                                
Co-Chair Seaton remarked that when  raw milk had been looked                                                                    
at four  years back  - there was  no prohibition  on selling                                                                    
raw  milk, but  a  person had  to  use dye  in  the milk  to                                                                    
indicate it was  raw. He stated that ere no  way for parents                                                                    
to know  non-pasteurized milk was being  served. He wondered                                                                    
about anti-bacteria resistant bacteria.                                                                                         
                                                                                                                                
2:25:04 PM                                                                                                                    
                                                                                                                                
Representative  Tarr   answered  there  had   been  numerous                                                                    
conversations  about the  topic over  the years.  She shared                                                                    
that there could state-built  processing facilities if there                                                                    
were  capital funds,  but  run as  a  private business.  She                                                                    
remarked that there was only one dairy in the state.                                                                            
                                                                                                                                
Vice-Chair Gara  asked for clarification  that the  raw milk                                                                    
component had been removed from the bill.                                                                                       
                                                                                                                                
Representative Tarr answered in the affirmative.                                                                                
                                                                                                                                
Vice-Chair Gara wanted to support  the bill. He asked if the                                                                    
bill had been run by school districts.                                                                                          
                                                                                                                                
Representative  Tarr replied  that  she  understood that  it                                                                    
would  be  eligible  for  any food  purchases  made  by  the                                                                    
district.  She   remarked  that   there  could  be   also  a                                                                    
supplemental  action,  if  the  food  was  provided  by  the                                                                    
federal  government.  She  stated   that  the  Sitka  School                                                                    
District was using local funds to purchase local fish.                                                                          
                                                                                                                                
Vice-Chair Gara  asked about  the known  cost to  the school                                                                    
district.                                                                                                                       
                                                                                                                                
Representative  Tarr   answered  that  it  was   known.  She                                                                    
remarked   that  the   scale   of   purchases  allowed   for                                                                    
flexibility,  because  there  were multiple  types  of  food                                                                    
going into one  meal. She used the example  of pairing cheap                                                                    
pasta with more expensive carrots.                                                                                              
                                                                                                                                
Vice-Chair  Gara felt  that  the school  may  end up  paying                                                                    
more, because  the cost of  the Alaska Grown products  was 8                                                                    
percent  more   than  the  alternative.  He   wanted  to  be                                                                    
convinced  that it  would not  cost more,  or he  wanted the                                                                    
school  districts  to  announce   that  they  would  not  be                                                                    
bothered by the increased cost.  He restated that he did not                                                                    
understand how the cost would remain the same.                                                                                  
                                                                                                                                
Representative  Tarr replied  that the  amount available  to                                                                    
spend on  the food  purchases would  not change.  She stated                                                                    
that the  change was  the ability  to purchase  Alaska Grown                                                                    
products.                                                                                                                       
                                                                                                                                
2:32:47 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara  understood the  bill  as  reading that  an                                                                    
Alaska Grown product would be an additional 15 percent.                                                                         
                                                                                                                                
Representative Tarr  replied that typical  procurement rules                                                                    
for state  purchasing expressed that  one must  purchase the                                                                    
lowest  cost item.  She stated  that the  product preference                                                                    
statute  allowed for  flexibility  to buy  a more  expensive                                                                    
product. She stated that, after  the audit, it was seen that                                                                    
7  percent was  not enough  of a  differential to  cover the                                                                    
difference between  Alaska Grown  products and  the products                                                                    
that could  be purchased from  outside. She stated  that the                                                                    
statute  gave  a  little more  flexibility  in  the  overall                                                                    
price,  if  the  Alaska  Grown   products  were  found.  She                                                                    
stressed  that  more farmers  should  be  on the  list,  and                                                                    
should  have products  available at  the right  quantity, at                                                                    
the right  time, and at  the right price. She  stressed that                                                                    
there were many pieces that  must function together in order                                                                    
for it to be successful.                                                                                                        
                                                                                                                                
2:34:05 PM                                                                                                                    
                                                                                                                                
Representative Wilson  stressed that the 15  percent was the                                                                    
maximum differential. She  agreed with Representative Gara's                                                                    
concern  about  the  additional  cost.  She  wondered  about                                                                    
changing  "shall" to  "may." She  felt that  the change  may                                                                    
provide the choice to the districts.                                                                                            
                                                                                                                                
Representative  Tarr replied  that the  previous version  of                                                                    
the  bill  had  the  word, "may."  She  stated  that,  after                                                                    
conversations  with farmers,  there was  a realization  that                                                                    
changing "shall" in the  original product preference statute                                                                    
to  "may", could  be seen  as "backsliding."  She agreed  to                                                                    
consider that change.                                                                                                           
                                                                                                                                
Representative Wilson  surmised that a statute  change would                                                                    
not be needed, because the  department had a one-year trial.                                                                    
She wondered  whether internet sales would  include products                                                                    
other than produce.                                                                                                             
                                                                                                                                
Representative  Tarr replied  that it  was all  the products                                                                    
allowed under  the cottage food exemptions.  She stated that                                                                    
it was  removed, because  of the  pilot program.  She shared                                                                    
that  Title  17   was  pretty  broad,  as   related  to  the                                                                    
responsibilities  of the  commissioner. She  stated that  it                                                                    
broadly  said, "can  regulate  food." She  wanted  to see  a                                                                    
consistent statewide  policy in  statute, rather  than pilot                                                                    
programs.                                                                                                                       
                                                                                                                                
Representative  Wilson  recalled   that  there  was  already                                                                    
internet sales for cottage businesses.                                                                                          
                                                                                                                                
Representative  Tarr  answered  that  there  had  been  some                                                                    
products available  online, but  not the number  of products                                                                    
that were currently sold.                                                                                                       
                                                                                                                                
2:37:04 PM                                                                                                                    
                                                                                                                                
Representative Pruitt  wondered how  the stat  would mandate                                                                    
that the  districts spend more,  and how $100  would procure                                                                    
what was  needed. He did  not understand how the  bill would                                                                    
not  increase costs,  or cause  the schools  to not  provide                                                                    
enough food.                                                                                                                    
                                                                                                                                
Representative Tarr  answered that  they did not  know there                                                                    
were food purchases that would meet the requirement.                                                                            
                                                                                                                                
Representative  Pruitt asked  what the  audit specified  the                                                                    
percentage should be.                                                                                                           
                                                                                                                                
Representative  Tarr answered  that it  had varied  based on                                                                    
the  product. Items  such as  potatoes, broccoli,  and other                                                                    
were widely produced in Alaska were cheaper.                                                                                    
                                                                                                                                
2:41:40 PM                                                                                                                    
                                                                                                                                
Representative Pruitt  asked how  the bill  gave flexibility                                                                    
if  it specified  an entity  "shall" purchase  something. He                                                                    
thought it appeared they were mandating something.                                                                              
                                                                                                                                
Representative Tarr  answered that flexibility  would enable                                                                    
paying  up to  15  percent  more. She  did  not  want to  do                                                                    
anything that  was overly  burdensome for  school districts.                                                                    
She explained  that the topic  had not  received substantial                                                                    
attention.                                                                                                                      
                                                                                                                                
Vice-Chair  Gara   presented  an  idea.  He   spoke  to  the                                                                    
consideration  of the  term "may",  and  whether that  would                                                                    
lose the  8 percent protection.  He asked about  keeping the                                                                    
language at  8 percent shall, and  adding "may" go up  to 15                                                                    
percent.                                                                                                                        
                                                                                                                                
2:46:24 PM                                                                                                                    
                                                                                                                                
Representative Tarr  answered that the language  had been in                                                                    
an  earlier   bill  version.  She  was   supportive  of  the                                                                    
language. She preferred the language over a blanket "may."                                                                      
                                                                                                                                
Vice-Chair Gara asked why the language had been changed.                                                                        
                                                                                                                                
Representative Tarr  answered that the intention  was not to                                                                    
spend more money, but to spend what was available.                                                                              
                                                                                                                                
Vice-Chair Gara  was looking for guidance  from the sponsor,                                                                    
but he did not want to render the bill ineffective.                                                                             
                                                                                                                                
Representative  Tarr answered  that  she was  fine with  the                                                                    
change.                                                                                                                         
                                                                                                                                
Vice-Chair Gara  had hesitancy that  his proposal  would gut                                                                    
the bill. He would think about it further.                                                                                      
                                                                                                                                
Representative Tarr believed the concerns were fair.                                                                            
                                                                                                                                
2:52:08 PM                                                                                                                    
                                                                                                                                
Co-Chair  Seaton  MOVED  to  ADOPT  the  proposed  committee                                                                    
substitute for HB 217,  Work Draft 30-LS0593\T (Bruce/Wayne,                                                                    
3/26/18). There being NO OBJECTION, it was so ordered.                                                                          
                                                                                                                                
Co-Chair  Foster  read  the  list  of  available  testifiers                                                                    
online.                                                                                                                         
                                                                                                                                
Representative  Tarr indicated  there were  2 people  online                                                                    
for invited testimony.                                                                                                          
                                                                                                                                
                                                                                                                                
Co-Chair Foster OPENED Public Testimony.                                                                                        
                                                                                                                                
AMY    SEITZ,   ALASKA    FARM   BOROUGH,    SOLDOTNA   (via                                                                    
teleconference),  relayed   that  the  Alaska   Farm  Bureau                                                                    
strongly supported  the bill. She  spoke of the  benefits of                                                                    
the  bill if  passed.  She indicated  that  HB 217  provided                                                                    
additional tools to  the farmers' tool box.  She thought the                                                                    
legislation  would  play a  role  in  the expansion  of  the                                                                    
Alaska  Grown  program.  She   talked  about  the  increased                                                                    
interest of touring farms.                                                                                                      
                                                                                                                                
3:00:49 PM                                                                                                                    
                                                                                                                                
Ms.  Seitz  continued to  address  the  bill. She  spoke  in                                                                    
support of the legislation.                                                                                                     
                                                                                                                                
ROBBI MIXON,  DIRECTOR, LOCAL  FOODS, HOMER  FARMER'S MARKET                                                                    
ASSOCIATION/KENAI  PENINSULA  AND  ANCHORAGE FOOD  HUB  (via                                                                    
teleconference), spoke in support of  the bill. She spoke to                                                                    
the online  sales component  of the bill.  There had  been a                                                                    
conversation on  agreements to move forward.  figure out the                                                                    
best approach. She attested to the value of Alaskan grown.                                                                      
                                                                                                                                
3:05:51 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster CLOSED public testimony.                                                                                        
                                                                                                                                
CHRISTINA  CARPENTER,  DIRECTOR, DIVISION  OF  ENVIRONMENTAL                                                                    
HEALTH, DEPARTMENT OF  ENVIRONMENTAL CONSERVATION, ANCHORAGE                                                                    
(via   teleconference),  thanked   the   bill  sponsor   and                                                                    
committee for  their efforts in promoting  local food sales.                                                                    
She  shared that  the department  looked forward  to working                                                                    
with  Ms.  Mixon and  the  Alaska  Food  Hub, on  the  pilot                                                                    
program that  would allow online  sales of  homemade cottage                                                                    
food  products. She  agreed  to continue  to  report on  the                                                                    
successes  of  that  program   during  the  current  growing                                                                    
season.  She thanked  the committee  for the  opportunity to                                                                    
speak.                                                                                                                          
                                                                                                                                
Representative   Wilson  queried   the  current   allowances                                                                    
online,  and what  the program  would  change. She  wondered                                                                    
what products would be allowed in the pilot program.                                                                            
                                                                                                                                
Ms. Carpenter replied that, currently,  any producer who had                                                                    
a   permit   through   the   Department   of   Environmental                                                                    
Conservation  (DEC) could  sell their  products online.  She                                                                    
stated  that  the pilot  program  would  allow cottage  food                                                                    
producers to sell  through the Food Hub  website. She stated                                                                    
that they would not be subject to the DEC permit.                                                                               
                                                                                                                                
Representative Wilson asked how  the department would manage                                                                    
the success of the program after the one-year period ended.                                                                     
                                                                                                                                
Ms.  Carpenter replied  that  it was  part  of the  variance                                                                    
process  with the  Alaska Food  Hub. She  remarked that  DEC                                                                    
would request  from the Alaska  Food Hub was  an end-of-year                                                                    
close-out report.                                                                                                               
                                                                                                                                
Representative   Wilson   requested  the   information   for                                                                    
tracking.                                                                                                                       
                                                                                                                                
3:09:59 PM                                                                                                                    
                                                                                                                                
Representative Pruitt  was looking  at the audit  and report                                                                    
conclusions. He read from the audit.                                                                                            
                                                                                                                                
Representative  Pruitt did  not see  anything in  the report                                                                    
conclusions to indicate  the amount given was  a barrier. He                                                                    
stated there were portions of  the current draft that were a                                                                    
mandate on schools. He thought  it appeared to be logistical                                                                    
hurdles.                                                                                                                        
                                                                                                                                
Representative  Tarr  answered  that   it  had  not  been  a                                                                    
question asked  by the  audit, which was  the reason  it did                                                                    
not answer the  question. They wanted to  understand how the                                                                    
current 7 percent statute was working.                                                                                          
                                                                                                                                
HB  217  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
3:14:31 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:15:55 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE JOINT RESOLUTION NO. 29                                                                                                 
                                                                                                                                
     Urging the United States Congress to reauthorize the                                                                       
     Secure    Rural   Schools    and   Communities    Self-                                                                    
     Determination Act of 2000.                                                                                                 
                                                                                                                                
3:16:00 PM                                                                                                                    
                                                                                                                                
Representative Wilson MOVED to  ADOPT the proposed committee                                                                    
substitute  for  HJR  29, Work  Draft  30-LS1116\J  (Laffen,                                                                    
3/24/18). There being NO OBJECTION, it was so ordered.                                                                          
                                                                                                                                
REPRESENTATIVE  GEORGE   RAUSCHER,  SPONSOR,  read   from  a                                                                    
prepared  statement.  He  stated  that  the  intent  of  the                                                                    
resolution  was  to  urge the  federal  government  to  take                                                                    
action   to   restore   funding   to   communities   through                                                                    
reauthorization  through  the  rural schools  and  community                                                                    
self-determination  action.  He   stated  that  the  program                                                                    
expired  in 2017,  and federal  funding for  the program  to                                                                    
local  school districts  had ceased.  He  remarked that  the                                                                    
recent federal  omnibus bill was included,  but would expire                                                                    
eventually.                                                                                                                     
                                                                                                                                
DARRELL  BREESE,  STAFF,   REPRESENTATIVE  GEORGE  RAUSCHER,                                                                    
shared that the changes made in the CS (copy on file):                                                                          
                                                                                                                                
     House State Affairs  The Committee Substitute corrected                                                                    
     an error  in the list  of Copy of  Recipients, removing                                                                    
     the Secretary  of Interior and including  the Secretary                                                                    
     of  Agriculture.  This  change  reflects  that  the  US                                                                    
     Forest Service  is under the Secretary  of Agriculture,                                                                    
     which  manages  the  Secure   Rural  Schools  and  Self                                                                    
     Determination Act of 2000.                                                                                                 
                                                                                                                                
     House Finance  Committee  Changes were  made to reflect                                                                    
     the  authorization of  two years  for the  program made                                                                    
     under  the  Federal   Omnibus  Spending  bill  recently                                                                    
     passed  by   the  US  Congress;   and  to   modify  the                                                                    
     resolution call  for a  permanent authorization  of the                                                                    
     Secure Rural Schools Funding program.                                                                                      
                                                                                                                                
     Page  2, following  line 11  inserts:  "Whereas the  US                                                                    
     Congress  has temporarily  authorized the  Secure Rural                                                                    
     Schools  and Community  Self-Determination Act  of 2000                                                                    
     for Federal Fiscal Years 2017 and 2018; and                                                                                
                                                                                                                                
     Page 2, line 14 After "to" Inserts "permanently"                                                                           
                                                                                                                                
     Page 2,  line 22  After "1027" Inserts  "or legislation                                                                    
     to permanently"                                                                                                            
                                                                                                                                
Representative Wilson  stated there was a  zero fiscal note.                                                                    
She asked if the item would be mailed or emailed.                                                                               
                                                                                                                                
Mr.  Breese  answered  that  they  were  traditionally  sent                                                                    
through mail,  and Legislative Affairs  covered the  cost of                                                                    
the postage for resolutions.                                                                                                    
                                                                                                                                
Representative  Wilson  felt that  they  could  be sent  via                                                                    
email.                                                                                                                          
                                                                                                                                
KATHIE  WASSERMAN,  EXECUTIVE   DIRECTOR,  ALASKA  MUNICIPAL                                                                    
LEAGUE, spoke in  support of the resolution.  She had worked                                                                    
on the issue for 15 years  and usually went to D.C. annually                                                                    
or  sent  a  timber.  The  resolution was  a  huge  boon  to                                                                    
municipalities, and  for small  communities like  Pelican it                                                                    
was   a  substantial   amount  of   money.  She   asked  the                                                                    
legislature  to help  lobby  for payment  in  lieu of  taxes                                                                    
(PILT).                                                                                                                         
                                                                                                                                
3:22:57 PM                                                                                                                    
                                                                                                                                
Representative Guttenberg  did not  have a problem  with the                                                                    
resolution.  He asked  if there  was any  comparable program                                                                    
covering impact funds in those communities.                                                                                     
                                                                                                                                
Ms. Wasserman  answered that  every community  received PILT                                                                    
payments.  The  payments in  Alaska  were  running at  about                                                                    
$0.07 per acre.                                                                                                                 
                                                                                                                                
Co-Chair Foster CLOSED public testimony.                                                                                        
                                                                                                                                
Vice-Chair  Gara  reviewed the  zero  fiscal  note from  the                                                                    
Legislative Affairs Agency.                                                                                                     
                                                                                                                                
Co-Chair  Seaton  MOVED  to  REPORT  CSHJR  29(FIN)  out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSHJR  29(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass" recommendation and with  one previously published zero                                                                    
fiscal note: FN1 (LEG).                                                                                                         
                                                                                                                                
3:26:32 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:27:05 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 386                                                                                                            
                                                                                                                                
     "An  Act relating  to abandoned  and derelict  vessels;                                                                    
     relating to  the registration  of vessels;  relating to                                                                    
     certificates  of title  for  vessels;  relating to  the                                                                    
     duties  of the  Department of  Administration; relating                                                                    
     to the  duties of the Department  of Natural Resources;                                                                    
     establishing  the derelict  vessel prevention  program;                                                                    
     establishing  the  derelict vessel  prevention  program                                                                    
     fund; and providing for an effective date."                                                                                
                                                                                                                                
3:27:30 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster discussed the schedule.                                                                                         
                                                                                                                                
3:28:05 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:28:33 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
REPRESENTATIVE  PAUL  SEATON, SPONSOR,  provided  background                                                                    
information about the  impetus for the bill.  He stated that                                                                    
in  2012  there  was  an   emergency,  because  someone  had                                                                    
purchased  two old  boats, but  could  not put  them in  the                                                                    
water.  He stated  that those  boats sank  in the  swamp. He                                                                    
stated  that  the  clean  up  of  the  vessels  was  a  long                                                                    
expensive   process.  He   shared  that   it  was   a  state                                                                    
responsibility, because  it was  difficult to  determine who                                                                    
owned and  who was  responsible for  the vessels.  He stated                                                                    
that he  had sponsored bill  that said that if  vessels were                                                                    
denied entry into harbor, they  could not be stored in state                                                                    
waters  for over  two weeks  without removing  the hazardous                                                                    
waste from  the vessels.  He felt  that the  legislation was                                                                    
difficult to enforce.                                                                                                           
                                                                                                                                
3:33:50 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton continued to discuss the need for the bill.                                                                     
                                                                                                                                
PATRICIA   NICKELL-ZIMMERMAN,  STAFF,   REPRESENTATIVE  PAUL                                                                    
SEATON, provided  a PowerPoint  presentation titled  "HB 386                                                                    
Vessels: Registration/Titles; Derelicts" (copy on file).                                                                        
                                                                                                                                
Ms. Nickell-Zimmerman  moved to slide 3,  "Title 05. Chapter                                                                    
25. Watercraft:                                                                                                                 
                                                                                                                                
     Undocumented Vessels:                                                                                                      
                                                                                                                                
          Adds Title requirement @20.00 for vessels that                                                                        
          are: (AS 05.25.096(a)(6))                                                                                             
               20 feet or more; and                                                                                             
               commercially used (AS 05.25.056(g))                                                                              
                                                                                                                                
          Increases boat registration fee to $30.00                                                                             
          [$24.00] for 3 years. (AS 05.25.096(a)(1))                                                                            
                                                                                                                                
          List of exemptions to Title and Registration                                                                          
          requirements. (AS 05.25.056), (AS 05.25.055(i))                                                                       
                                                                                                                                
     Documented Vessels:                                                                                                        
                                                                                                                                
          No Title required (AS 05.25.055(i)(1)(c))                                                                             
                                                                                                                                
          Adds Registration of $30.00 for 3 years. (AS                                                                          
          05.25.096(a)(1))                                                                                                      
                                                                                                                                
     Barges                                                                                                                     
                                                                                                                                
          Adds definition of barge (AS 05.25.100(16))                                                                           
                                                                                                                                
          Adds Barge registration of $75.00 for 3 years.                                                                        
          (AS 05.25.096(5))                                                                                                     
                                                                                                                                
3:39:23 PM                                                                                                                    
                                                                                                                                
Ms. Nickell-Zimmerman turned to slide 4, "Title 30. Chapter                                                                     
30. Abandoned and Derelict Vessels":                                                                                            
                                                                                                                                
     ?  Adds state or municipal property to areas that a                                                                      
     person    may   not    store    a   derelict    vessel.                                                                    
     AS 30.30.010 (a)(1)                                                                                                        
                                                                                                                                
     ?   Amends statute  upon conviction, increases  fine to                                                                  
     not less than 5K or more  than 10K and/or not more than                                                                    
     90 days  imprisonment and/or  forfeiture of  vessel. AS                                                                    
     30.30.010(e)                                                                                                               
                                                                                                                                
     ? Adds DNR duties and powers to establish and                                                                            
     administer Derelict Vessel Prevention Program Fund.                                                                        
     AS 30.30.095 and 096                                                                                                       
                                                                                                                                
     ? Adds regulated process for impoundment, through                                                                        
     notice and hearings prior to disposition. AS                                                                               
     30.30.040, 045, 055, 060, 065, 075                                                                                         
                                                                                                                                
Ms. Nickell-Zimmerman addressed slide 5 titled "What is                                                                         
Derelict?":                                                                                                                     
                                                                                                                                
     DERELICT VESSEL 30.30.090                                                                                                  
                                                                                                                                
          Sunk  or   sinking,  obstructing   or  endangering                                                                    
          health, safety, or environment                                                                                        
                                                                                                                                
          number obliterated                                                                                                    
                                                                                                                                
          Owner of record disclaims and current owner                                                                           
          cannot  be determined                                                                                                 
                                                                                                                                
          Moored,    anchored,   stored,    abandoned   (see                                                                    
          definition) or left contrary to law                                                                                   
                                                                                                                                
          No  record of  documentation  or registration  and                                                                    
          ownership cannot be determined                                                                                        
                                                                                                                                
          Moored,    anchored,   stored,    abandoned   (see                                                                    
          definition)   without  authorization   on  private                                                                    
          property.                                                                                                             
                                                                                                                                
          Expired registration or  document number and owner                                                                    
          no longer at address                                                                                                  
                                                                                                                                
Ms. Nickell-Zimmerman moved to slide 6 titled "Process to                                                                       
Impoundment":                                                                                                                   
                                                                                                                                
     20 days prior to impoundment, written notice and                                                                           
     posted on agencies website AS 30.30.040                                                                                    
                                                                                                                                
     Within 15 days after postmark on written notice, owner                                                                     
     may request informal pre-impoundment hearing AS                                                                            
     30.30.040(c)                                                                                                               
               10 business  days (or  longer per  request of                                                                    
          owner) after receipt of  written request by owner,                                                                    
          jurisdiction  schedules  informal   hearing.    AS                                                                    
          30.30.040(d)                                                                                                          
               Jurisdiction to  provide written  decision to                                                                    
          owner, showing  "substantial evidence  that vessel                                                                    
          is derelict". AS 30.30.040(f)                                                                                         
                                                                                                                                
     If found to be derelict, jurisdiction may impound                                                                          
     AS 30.30.055                                                                                                               
               Owner may take  possession upon reimbursement                                                                    
          to  State  or   municipality  of  incurred  costs.                                                                    
          (notices costs,  harbor fees, storage  fees, etc.)                                                                    
          AS 30.30.060                                                                                                          
               Jurisdiction may  sell, donate or  destroy if                                                                    
          not repossessed  within 30 days after  postmark on                                                                    
          written  notice  AS30.30.055(b)     after  posting                                                                    
          disposition. AS 30.30.045                                                                                             
                                                                                                                                
Ms. Nickell-Zimmerman  addressed slide 7,  "Appropriation of                                                                    
Title   Fees   and   Barge   Fees   created   through   this                                                                    
legislation":                                                                                                                   
                                                                                                                                
     Derelict Vessel Prevention Program Fund AS 30.30.096                                                                       
          Money is appropriated into the fund, no further                                                                       
          appropriation is needed to move funds out.                                                                            
          Appropriations do not lapse.                                                                                          
                                                                                                                                
3:44:41 PM                                                                                                                    
                                                                                                                                
Representative Wilson MOVED to  ADOPT the proposed committee                                                                    
substitute  for  HB  386,  Work  Draft  30-LS1475\D  (Bruce,                                                                    
3/21/18). There being NO OBJECTION, it was so ordered.                                                                          
                                                                                                                                
Vice-Chair  Gara  supported the  bill.  He  remarked on  the                                                                    
short  title  of  the  bill, which  he  believed  should  be                                                                    
changed.                                                                                                                        
                                                                                                                                
Representative  Kawasaki  asked  about the  collection  from                                                                    
people who had left derelict vehicles.                                                                                          
                                                                                                                                
Co-Chair Foster listed individuals available for questions.                                                                     
                                                                                                                                
Co-Chair Seaton deferred to the Department of Law.                                                                              
                                                                                                                                
3:47:25 PM                                                                                                                    
                                                                                                                                
PETER CALTAGIRONE,  ATTORNEY, CIVIL  DIVISION, ENVIRONMENTAL                                                                    
SECTION, DEPARTMENT  OF LAW  (via teleconference),  asked to                                                                    
hear the question.                                                                                                              
                                                                                                                                
Representative  Kawasaki wondered  why it  was difficult  to                                                                    
prosecute the owner in removing their "junk."                                                                                   
                                                                                                                                
Mr. Caltagirone replied that the  current penalty in statute                                                                    
was not very high. The  bill as presented increased both the                                                                    
fines,  and punishment  as an  unclassified misdemeanor.  He                                                                    
remarked  that the  difficulty in  removing  the vessel  was                                                                    
primarily the cost. He shared  that the current statute gave                                                                    
the   Department  of   Natural  Resources   (DNR)  and   the                                                                    
municipality the  ability to  take the  vessel, but  did not                                                                    
address  the high  cost.  He shared  that  the current  bill                                                                    
created  a titling  requirement, which  would help  tracking                                                                    
the owner. He  furthered that even knowing the  owner of the                                                                    
vessel did  not guarantee removal  of the vessel.  He stated                                                                    
that there was a high cost to remove even a smaller vessel.                                                                     
                                                                                                                                
3:51:10 PM                                                                                                                    
                                                                                                                                
Representative Kawasaki  asked about past  legislation about                                                                    
derelict mining equipment on state lands.                                                                                       
                                                                                                                                
Mr.  Caltagirone   was  not  familiar  with   the  mentioned                                                                    
legislation.                                                                                                                    
                                                                                                                                
Representative  Guttenberg   noted  that   the  registration                                                                    
process sat on  top of the Division of  Motor Vehicles (DMV)                                                                    
process. He asked if  there was a way for a  party to take a                                                                    
vessel before it derelict and take ownership.                                                                                   
                                                                                                                                
Mr. Caltagirone replied in the  negative. The current law as                                                                    
written  did not  allow  it. There  was  no current  titling                                                                    
requirement in Alaska.                                                                                                          
                                                                                                                                
Representative Guttenberg  asked if  a person would  have an                                                                    
opportunity to bid on the item.                                                                                                 
                                                                                                                                
Mr. Caltagirone  asked what Representative  Guttenberg meant                                                                    
by his use of the word "you."                                                                                                   
                                                                                                                                
Representative Guttenberg clarified.                                                                                            
                                                                                                                                
Mr. Caltagirone  replied it would be  his understanding. For                                                                    
the state  to get involved he  believed it would have  to be                                                                    
on trespassing.                                                                                                                 
                                                                                                                                
3:54:38 PM                                                                                                                    
                                                                                                                                
Co-Chair  Seaton requested  to hear  about the  process from                                                                    
his staff.                                                                                                                      
                                                                                                                                
Ms. Nickel-Zimmerman  shared that one of  the questions that                                                                    
had arisen when  DMV had approached the  sponsor was related                                                                    
to titling.  Titling would be  new for boat owners,  and was                                                                    
proof  of  ownership. They  had  been  told there  would  be                                                                    
another process for the potential of an affidavit.                                                                              
                                                                                                                                
Representative  Wilson  asked  for  verification  they  were                                                                    
speaking about boats 20 feet or larger.                                                                                         
                                                                                                                                
Ms. Nickel-Zimmerman replied in the affirmative.                                                                                
                                                                                                                                
HB  386  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
Co-Chair  Foster  reviewed  the  meeting  schedule  for  the                                                                    
following day.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
3:59:00 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:58 p.m.                                                                                          

Document Name Date/Time Subjects
HB 219 Sectional for HFIN.pdf HFIN 3/28/2018 1:30:00 PM
HB 219
HB219 Transmittal Letter.pdf HFIN 3/28/2018 1:30:00 PM
HB 219
HJR 29 Secure Rural Schools Funding in Federal Omnibus Bill.pdf HFIN 3/28/2018 1:30:00 PM
HJR 29
HB 386 Draft Proposed CS Ver D 03.27.18.pdf HFIN 3/28/2018 1:30:00 PM
HB 386
HB 386 statute changes power point house finance.pdf HFIN 3/28/2018 1:30:00 PM
HB 386
HB 217 Alaska Grown 3-26-18.pdf HFIN 3/28/2018 1:30:00 PM
HB 217
HB 217 Version T 3-27-18.pdf HFIN 3/28/2018 1:30:00 PM
HB 217
HB 217 Alaska Grown Sponsor Statement 3.27.18.pdf HFIN 3/28/2018 1:30:00 PM
HB 217
HB 386 Sectional Analysis ver D 03.28.18.pdf HFIN 3/28/2018 1:30:00 PM
HB 386
HB 386 Sectional changes ver A to Ver D 03.28.18.pdf HFIN 3/28/2018 1:30:00 PM
HB 386
HB 217 Summary of Changes Version O to T.pdf HFIN 3/28/2018 1:30:00 PM
HB 217
HB217 Letters of Support 3.28.18.pdf HFIN 3/28/2018 1:30:00 PM
HB 217
HB 386 Letter of concern 3.28.18.pdf HFIN 3/28/2018 1:30:00 PM
HB 386
HJR 29 Dr. Wegner testomony.pdf HFIN 3/28/2018 1:30:00 PM
HJR 29
HB 217 Audit 2015.pdf HFIN 3/28/2018 1:30:00 PM
HB 217