Legislature(2017 - 2018)ADAMS ROOM 519

04/04/2018 01:30 PM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 398 CORP TAX:PUBLIC UTILITY INCOME ALLOCATION TELECONFERENCED
Moved HB 398 Out of Committee
-- Public Testimony --
+ HB 399 CORP. TAX: REMOVE EXEMPTIONS/CREDITS TELECONFERENCED
<Bill Hearing Canceled>
<Pending Referral>
-- Public Testimony --
+= HB 277 BROADBAND INTERNET: NEUTRALITY/REGULATION TELECONFERENCED
Heard & Held
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 129 FISH & GAME: OFFENSES;LICENSES;PENALTIES TELECONFERENCED
Heard & Held
-- Public Testimony --
                  HOUSE FINANCE COMMITTEE                                                                                       
                       April 4, 2018                                                                                            
                         1:38 p.m.                                                                                              
                                                                                                                                
1:38:52 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Foster called the meeting to order at 1:38 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                                                                                                                  
                                                                                                                                
Brodie Anderson, Staff,  Representative Neal Foster; Brandon                                                                    
S.  Spanos, Deputy  Director,  Tax  Division, Department  of                                                                    
Revenue;  Martin  Stepetin,   Self,  Juneau;  Representative                                                                    
Scott    Kawasaki,    Sponsor;   Jacob    Gerrish,    Staff,                                                                    
Representative  Scott   Kawasaki;  Martin   Stepetin,  Self,                                                                    
Juneau.                                                                                                                         
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Major   Bernard   Chastain,    Alaska   Wildlife   Troopers,                                                                    
Department  of  Public   Safety;  Aaron  Peterson,  Criminal                                                                    
Division, Office of Special  Prosecution, Department of Law;                                                                    
Bruce  Dale, Director,  Division  of Wildlife  Conservation,                                                                    
Department  of  Fish  and Game,  Anchorage;  Mike  Robinson,                                                                    
Alaska  Library Association,  Anchorage;  Mary Jo  Torgeson,                                                                    
Anchorage  Public Library,  Anchorage; Evelyn  Trefon, Self,                                                                    
Newhalen;  Leon  Jaimes,  Self,  Anchorage;  David  Parrish,                                                                    
Common Carrier Specialist IV, Regulatory Commission of                                                                          
Alaska; Jonathan Clement, Attorney, Civil Division,                                                                             
Department of Law.                                                                                                              
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 129    FISH & GAME: OFFENSES;LICENSES;PENALTIES                                                                              
                                                                                                                                
          HB 129 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HB 277    BROADBAND INTERNET: NEUTRALITY/REGULATION                                                                             
                                                                                                                                
          HB 277 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HB 398    CORP TAX:PUBLIC UTILITY INCOME ALLOCATION                                                                             
                                                                                                                                
          HB 398 was REPORTED out of committee with a no                                                                        
          recommendation and with one zero fiscal note from                                                                     
          the Department of Revenue.                                                                                            
                                                                                                                                
Co-Chair Foster reviewed the meeting agenda.                                                                                    
                                                                                                                                
HOUSE BILL NO. 398                                                                                                            
                                                                                                                                
     "An Act  relating to  the allocation  and apportionment                                                                    
     of  income of  a  public utility  for  purposes of  the                                                                    
     Alaska  Net  Income  Tax  Act;  and  providing  for  an                                                                    
     effective date."                                                                                                           
                                                                                                                                
1:40:12 PM                                                                                                                    
                                                                                                                                
BRODIE ANDERSON, STAFF, REPRESENTATIVE NEAL FOSTER, relayed                                                                     
that the bill addressed foregone revenue. He read from a                                                                        
prepared statement:                                                                                                             
                                                                                                                                
     HB  399 is  accumulation  of work  to address  foregone                                                                    
     revenue  and  provide the  state  with  the ability  to                                                                    
     potentially capture new revenue.                                                                                           
                                                                                                                                
     A brief  history on how  this piece of  legislation was                                                                    
     introduced.                                                                                                                
                                                                                                                                
     In 2014,  legislation was passed  that required  a both                                                                    
     Department  of  Revenue   and  Legislative  Finance  to                                                                    
     create  a  report  on  Indirect  Expenditures  and  the                                                                    
     amount forgone revenue not captured by the State.                                                                          
                                                                                                                                
     The first Indirect Expenditure  Report was submitted in                                                                    
     2015. In that  report it identified a  list of indirect                                                                    
     expenditures within  Department of Revenue  that should                                                                    
     be terminated.                                                                                                             
                                                                                                                                
     Then  last year  during  the FY18  budget process,  the                                                                    
     House  Finance  Subcommittee   for  the  Department  of                                                                    
     Revenue  reviewed   these  indirect   expenditures  and                                                                    
     recommended   that   House  Finance   Committee   offer                                                                    
     legislation    that     eliminates    these    indirect                                                                    
     expenditures.                                                                                                              
                                                                                                                                
     HB 399 repeals certain  credits and exemptions from the                                                                    
     recommendations   offered   in    both   the   Indirect                                                                    
     expenditure report and the Sub-committee.                                                                                  
                                                                                                                                
     The  indirect  expenditures  repealed in  HB  399  were                                                                    
     selected   for  repeal   for  following   reasons:  The                                                                    
     indirect expenditures did  not meet legislative intent,                                                                    
     had   limited  benefit   or  wasn't   used,  or   their                                                                    
     conforming purpose has changed.                                                                                            
                                                                                                                                
     House   Bill  399   repeals   the  following   indirect                                                                    
     expenditures:                                                                                                              
     ? Federal Tax Credits                                                                                                      
     ? Foreign Royalty Exclusions                                                                                               
     ? Reduced Rate for Capital Gains                                                                                           
     ? Credit associated with the Stranded Gas Act                                                                              
                                                                                                                                
     The combined total  of the potential new  revenue is up                                                                    
     to an  estimated $6.9 million dollars  according to the                                                                    
     fiscal note in front of the committee.                                                                                     
                                                                                                                                
1:43:15 PM                                                                                                                    
                                                                                                                                
Mr. Anderson reviewed the sectional analysis (copy on                                                                           
file):                                                                                                                          
                                                                                                                                
     Section  1 AS  43.20  Adds new  section Sec.  43.20.146                                                                    
     Removes  the exemption  of multistate  public utilities                                                                    
     from water's  edge reporting within the  Multistate Tax                                                                    
     Compact.                                                                                                                   
                                                                                                                                
     Section   2    Uncodified   Law   Adds    new   section                                                                    
     Applicability Section  1 does not take  effect under AS                                                                    
     43.20 (Alaska  Net Income Tax Act)  until the effective                                                                    
     date.                                                                                                                      
                                                                                                                                
     Section 3 Uncodified Law Adds new section Transition:                                                                      
     Regulations shall change to implement the legislation                                                                      
     but not be adopted before January 1, 2019.                                                                                 
                                                                                                                                
     Section 4 Effective Date Sections 1 and 2 take effect                                                                      
     on January 1, 2019                                                                                                         
                                                                                                                                
Co-Chair  Foster  asked  to  hear  from  the  Department  of                                                                    
Revenue.                                                                                                                        
                                                                                                                                
Representative   Wilson   asked   if   the   bill   included                                                                    
nonprofits.                                                                                                                     
                                                                                                                                
BRANDON   S.   SPANOS,   DEPUTY  DIRECTOR,   TAX   DIVISION,                                                                    
DEPARTMENT  OF REVENUE,  answered  that the  bill would  not                                                                    
apply to nonprofits.                                                                                                            
                                                                                                                                
Representative Wilson provided a  scenario where a telephone                                                                    
company operated in  Alaska and New York.  She asked whether                                                                    
the  taxes paid  would  be split  between  both states.  Mr.                                                                    
Spanos answered  in the affirmative.  He explained  that the                                                                    
amount Alaska would receive was  based on property, payroll,                                                                    
and sales.                                                                                                                      
                                                                                                                                
1:46:14 PM                                                                                                                    
                                                                                                                                
Representative Ortiz shared  that he had a  local utility in                                                                    
his community owned by the city.  He asked if the bill would                                                                    
impact  the  utility.  Mr. Spanos  answered  that  utilities                                                                    
owned by the municipality had  a tax-exempt status. The bill                                                                    
would not apply to those entities.                                                                                              
                                                                                                                                
Co-Chair  Foster  spoke  to   utilities  doing  business  in                                                                    
multiple  states.  He  stated  that  typically  corporations                                                                    
should  follow   the  "three  factor   apportionment  income                                                                    
formula". The bill would eliminate  the exemption from three                                                                    
utilities  that   currently  did  not  follow   the  formula                                                                    
resulting in  all utilities following  the same  formula. He                                                                    
asked if his understanding was accurate.                                                                                        
                                                                                                                                
Mr.  Spanos  answered that  it  was  partially accurate.  He                                                                    
clarified that the  statute allowed the utility  to choose a                                                                    
different  formula  and  the   bill  standardized  the  same                                                                    
formula for everyone.                                                                                                           
                                                                                                                                
Co-Chair Foster OPENED and CLOSED public testimony.                                                                             
                                                                                                                                
1:48:48 PM                                                                                                                    
                                                                                                                                
Co-Chair  Foster relayed  amendments  would be  due by  5:00                                                                    
p.m.                                                                                                                            
                                                                                                                                
1:49:06 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:49:20 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Foster  related that the committee  was comfortable                                                                    
with moving the bill out of committee.                                                                                          
                                                                                                                                
Co-Chair Seaton  noted the bill  had a new zero  fiscal note                                                                    
from the Department of Revenue (DOR).                                                                                           
                                                                                                                                
Co-Chair  Seaton MOVED  to REPORT  HB 398  out of  committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
note.                                                                                                                           
                                                                                                                                
Representative Wilson OBJECTED for  a clarification that the                                                                    
fiscal note was indeterminate for state revenue.                                                                                
                                                                                                                                
There being NO further OBJECTION, it was so ordered.                                                                            
                                                                                                                                
HB 398 was REPORTED out  of committee with no recommendation                                                                    
and  with  one  zero  fiscal note  from  the  Department  of                                                                    
Revenue.                                                                                                                        
                                                                                                                                
1:50:33 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:51:07 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 129                                                                                                            
                                                                                                                                
     "An  Act   relating  to  sport  fishing,   hunting,  or                                                                    
     trapping  licenses,  tags,   or  permits;  relating  to                                                                    
     penalties  for  certain  sport  fishing,  hunting,  and                                                                    
     trapping license  violations; relating  to restrictions                                                                    
     on  the   issuance  of  sport  fishing,   hunting,  and                                                                    
     trapping  licenses;  creating violations  and  amending                                                                    
     fines  and  restitution  for   certain  fish  and  game                                                                    
     offenses;  creating   an  exemption  from   payment  of                                                                    
     restitution for  certain unlawful  takings of  big game                                                                    
     animals;  relating  to commercial  fishing  violations;                                                                    
     allowing lost  federal matching funds from  the Pittman                                                                    
     -   Robertson,  Dingell   -  Johnson/Wallop   -  Breaux                                                                    
     programs  to be  included in  an order  of restitution;                                                                    
     adding   a  definition   of   'electronic  form';   and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
1:51:40 PM                                                                                                                    
                                                                                                                                
MAJOR   BERNARD   CHASTAIN,    ALASKA   WILDLIFE   TROOPERS,                                                                    
DEPARTMENT OF PUBLIC SAFETY (via teleconference), read from                                                                     
prepared remarks. He read the sectional analysis.                                                                               
                                                                                                                                
     Summary:  This  legislation  will  provide  the  Alaska                                                                    
     Wildlife Troopers the authority to issue                                                                                   
     correctable citations,  similar to those  available for                                                                    
     driver's  licenses. This  bill will  prohibit a  person                                                                    
     from receiving  a sport  fishing, hunting,  or trapping                                                                    
     license  in  Alaska  if   their  privileges  have  been                                                                    
     suspended  or revoked  in this  or another  state. This                                                                    
     bill  increased the  restitution for  animals harvested                                                                    
     illegally  and  provided  an additional  tool  for  the                                                                    
     Alaska   Wildlife   Troopers  in   charging   wildlife,                                                                    
     fisheries,  and habitat  crimes  by  allowing for  some                                                                    
     offenses  to be  reduced  to  violations. Finally,  the                                                                    
     bill  allows  for  the  display  of  a  license  in  an                                                                    
     electronic  format  to  reflect  modernization  efforts                                                                    
     made to the fish and game licensing program.                                                                               
     Section  1  This  section  amends  AS  16.05.330(a)  to                                                                    
     include  "permit" in  addition to  "license" and  "tag"                                                                    
     for  purposes   of  clarifying  the  proper   types  of                                                                    
     documentation  a  person  must  have  in  their  actual                                                                    
     possession  when  engaging  in certain  activities  and                                                                    
     reorders   the  activities   of  "trapping"   and  "fur                                                                    
     dealing"   to  exclude   the   latter   from  being   a                                                                    
     correctable citation.                                                                                                      
     Under AS 16.05.330, a person  engaged in the activities                                                                    
     listed  in  1-5 in  section  one,  must have  in  their                                                                    
     actual possession  a license, tag or  permit to legally                                                                    
     engage  in that  activity.  Section  one re-orders  the                                                                    
     activities into  two separate categories;  1 and  2 are                                                                    
     considered  sport  activities  and   3,  4  and  5  are                                                                    
     considered commercial activities.  The purpose for this                                                                    
     is contained in section three of this bill                                                                                 
                                                                                                                                
1:54:55 PM                                                                                                                    
                                                                                                                                
Major Chastain continued with Section 2.                                                                                        
                                                                                                                                
     Section 2  This section amends AS  16.05.330(d) to make                                                                    
     it unlawful  for a  person to  obtain a  sport fishing,                                                                    
     hunting, or trapping license if  the person's rights to                                                                    
     engage in  those activities is revoked  or suspended in                                                                    
     Alaska.                                                                                                                    
     Section 3  This section  amends AS 16.05.330  by adding                                                                    
     three subsections:                                                                                                         
     (f)  provides that  a person  charged  with failing  to                                                                    
     have   the  appropriate   sport  fishing,   hunting  or                                                                    
     trapping license in their actual  possession may not be                                                                    
     convicted if  the person produces a  license previously                                                                    
     issued to the person that was  valid at the time of the                                                                    
     offense not  later than 30  days after the  issuance of                                                                    
     the citation.                                                                                                              
     (g) allows  that a license  or permit may be  in actual                                                                    
     possession in paper or electronic form.                                                                                    
     (h)The third  subsection specifically states  any peace                                                                    
     officer presented with an  electronic device under this                                                                    
     section shall  be immune  from any  liability resulting                                                                    
     from damage to the device.                                                                                                 
                                                                                                                                
1:56:43 PM                                                                                                                    
                                                                                                                                
Major Chastain moved to Section 4 that had been added in a                                                                      
previous committee:                                                                                                             
                                                                                                                                
     Section 4 This  section amends AS 16.05.340  (a) (6) to                                                                    
     require  a person  paying  the reduced  fee  for a  low                                                                    
     income  resident hunting,  trapping, and  sport fishing                                                                    
     license to provide proof of  eligibility at the time of                                                                    
     purchase.                                                                                                                  
                                                                                                                                
     Section 5  Under AS 16.05.430 fish  and game penalties,                                                                    
     this   section  increases   the   specific  fines   and                                                                    
     penalties associated  with an  unclassified misdemeanor                                                                    
     and replaces it with a class A misdemeanor.                                                                                
     Section   5   specifically  exempts   the   correctable                                                                    
     citation  section   16.05.330(f)  from   the  penalties                                                                    
     portion  of the  statute.  Additionally,  it makes  the                                                                    
     crimes listed a class A misdemeanor.                                                                                       
                                                                                                                                
Major Chastain  listed Sections  5, 12, 21,  25, and  27 and                                                                    
explained that  they were amended  by a  previous committee.                                                                    
He read  from a  description of  the amendment  that altered                                                                    
the sections. He delineated that  the amendment was designed                                                                    
to  limit the  fines on  some of  the offenses  in Title  16                                                                    
which  was amended  by  HB 129.  The  amendment removed  the                                                                    
general reference to AS.12.55  in many places and reinstated                                                                    
the specific  incarceration penalties from current  law. The                                                                    
amendment left  references to Class A  misdemeanors in areas                                                                    
where  the  specific  penalties  were  reinstated.  Class  A                                                                    
misdemeanors  had a  specific  meaning in  the  law and  the                                                                    
penalties  were contained  in  AS.12.55.  The Department  of                                                                    
Public Safety  (DPS) recommended  removing the  reference to                                                                    
Class  A and  changing  to  non-classified misdemeanors.  He                                                                    
voiced that the  change was consistent with  current law. He                                                                    
reported  that  the representative  [Representative  Ledoux]                                                                    
who  offered the  amendment concurred  with the  recommended                                                                    
change.                                                                                                                         
                                                                                                                                
1:59:10 PM                                                                                                                    
                                                                                                                                
Major Chastain addressed Sections 6 through 8:                                                                                  
                                                                                                                                
     Section 6  Related to  section 5,  this section  adds a                                                                    
     new subsection  and creates the ability  to charge some                                                                    
     offenses as violations that  are currently only allowed                                                                    
     to be  charged as  misdemeanors. It also  addresses the                                                                    
     Pittman-Robertson  act  and  federal  matching  dollars                                                                    
     lost  by  the  State  of   Alaska  when  the  state  is                                                                    
     defrauded  by a  defendant  who does  not purchase  the                                                                    
     proper  license  and/or  tag  as  required  by  law  to                                                                    
     participate in a given hunt or fishery.                                                                                    
     Section  6 of  this  bill creates  two new  subsections                                                                    
     within AS 16.05.430:                                                                                                       
     Subsection  (c)  establishes  that   a  person  may  be                                                                    
     charged  with  the violation  offence  if  there is  no                                                                    
     culpable mental state established.                                                                                         
     Subsection (d)  provides the court with  the ability to                                                                    
     impose additional  restitution to  the state  of Alaska                                                                    
     equal  to the  amount  of lost  federal matching  funds                                                                    
     from  the   Pittman-Robertson  /  Johnson/Wallop-Breaux                                                                    
     programs  when the  state is  defrauded by  a defendant                                                                    
     who does  not purchase  the appropriate license  or tag                                                                    
     or claims  residency when they  are not a  resident. If                                                                    
     the   court  decides   to   implement  the   additional                                                                    
     restitution for  the loss of  federal funds,  the court                                                                    
     will be instructed to deposit  the restitution into the                                                                    
     fish and game fund.                                                                                                        
     Section  7 This  section  raises  the strict  liability                                                                    
     commercial  fishing violation  fines  from the  amounts                                                                    
     established in 1988, when this  section was enacted, to                                                                    
     the  same  amount  adjusted  for  inflation.  The  fine                                                                    
     increase will  serve as both  a deterrent and  tool for                                                                    
     Alaska  Wildlife Troopers  to  effectively enforce  the                                                                    
     states most important fisheries.                                                                                           
                                                                                                                                
     Section  8 This  section requires  the court  system to                                                                    
     transmit notice  of all convictions under  this section                                                                    
     to  the Commercial  Fisheries Entry  Commission (CFEC).                                                                    
     Commercial  fishers  are   applied  points  similar  to                                                                    
     driver's  licenses  when  a   person  is  convicted  of                                                                    
     certain commercial fishing offenses.                                                                                       
                                                                                                                                
2:00:16 PM                                                                                                                    
                                                                                                                                
Major Chastain addressed Sections 9 and 10:                                                                                     
                                                                                                                                
     Section 9  Amends AS 16.05.782 and  removes the penalty                                                                    
     section  from (a)  which cleans  up the  subsection and                                                                    
     makes it  clearer. This section  makes it clear  that a                                                                    
     person  may not  take a  brown or  grizzly bear  within                                                                    
     one-half mile  of a solid waste  disposal facility. The                                                                    
     penalties  for  this  section  will  now  be  contained                                                                    
     within sections 10 and 11.                                                                                                 
     Sectional Analysis CSHB129 (JUD) FISH & GAME:                                                                              
     OFFENSES;LICENSES;PENALTIES Page 3 of 5                                                                                    
     Section 10  Related to section 9,  this section removes                                                                    
     the unnecessary reference to  section (a) and maintains                                                                    
     the  additional penalties  of  an  additional fine  for                                                                    
     failing  to salvage  the hide  and skull  of the  Brown                                                                    
     Bear.                                                                                                                      
                                                                                                                                
Major  Chastain detailed  that the  sections cleaned  up the                                                                    
statutes and established Class A  misdemeanors as a standard                                                                    
for  the offenses  but also  allowed charging  for violation                                                                    
offenses  therefore,  many   sections  contain  a  violation                                                                    
offense and the standardized misdemeanor offense.                                                                               
                                                                                                                                
2:01:04 PM                                                                                                                    
                                                                                                                                
Major Chastain read a  summary of Sections 11 through 16:                                                                       
                                                                                                                                
     Sections 11-16  generally standardize penalties  in the                                                                    
     statutes listed  by providing  an additional  option of                                                                    
     charging  a  person  with   a  violation  offense  when                                                                    
     appropriate.                                                                                                               
                                                                                                                                
Major Chastain highlighted Sections 17 and 18:                                                                                  
                                                                                                                                
     Section  17  Under AS  16.05.901  a  new subsection  is                                                                    
     added in this section  to provide for charging offenses                                                                    
     committed   under  AS   16.05.871-AS  16.05.896   as  a                                                                    
     violation offence punishable as provided in AS 12.55.                                                                      
     Section   18   Under    AS   16.05.925   "Penalty   for                                                                    
     violations",  subsection  (a)  is  amended  to  provide                                                                    
     consistency  in  the  penalties as  provided  under  AS                                                                    
     12.55 and  provides an exemption  for a  new subsection                                                                    
     added under (c).                                                                                                           
     Under AS  16.05.925 (b),  this subsection  provides for                                                                    
     restitution  amounts  that  the court  may  impose  for                                                                    
     illegally  taken  big  game  animals  in  Alaska.  This                                                                    
     section increases  the restitution amounts by  at least                                                                    
     50% that  a person  convicted of unlawfully  taking big                                                                    
     game may have  to pay to the state if  the court choses                                                                    
     to implement restitution. Alaska's  game belongs to all                                                                    
     of us collectively. When a                                                                                                 
     big game  animal is unlawfully  taken, it  defrauds the                                                                    
     state  of the  value of  that animal  to its  citizens.                                                                    
     This value  varies greatly depending on  the species of                                                                    
     animal, the location  of the take, the  social value of                                                                    
     the animal,  the economic value  of the animal  and the                                                                    
     food source  value to  the people  of the  state. These                                                                    
     restitution values may  be imposed by the  court if the                                                                    
     case warrants  applying restitution. In most  cases, it                                                                    
     does not  make the  state "whole" for  the loss  of the                                                                    
     animal but  helps pay  the state  back for  the illegal                                                                    
     take.                                                                                                                      
     Current restitution  amounts were  enacted in  1984 and                                                                    
     have gone untouched since then.                                                                                            
                                                                                                                                
     This  section  adds  a  provision  that  refers  to  an                                                                    
    inflation adjustment provision added in section 19.                                                                         
                                                                                                                                
2:02:57 PM                                                                                                                    
                                                                                                                                
Major Chastain moved to Section 19:                                                                                             
     Section  19 Under  AS 16.05.925  a  new subsection  was                                                                    
     added  relating  to   subsection  (b).  Subsection  (c)                                                                    
     establishes that a defendant may  not be ordered to pay                                                                    
     restitution to the state under this section if:                                                                            
     (1)  as  soon  as reasonably  practicable,  voluntarily                                                                    
     reports the  taking to  the department  of a  state law                                                                    
     enforcement  officer  engaged   in  fish  and  wildlife                                                                    
     protection; and                                                                                                            
     (2) Surrenders to the  department all salvaged portions                                                                    
     of the  animal including  the horns, antlers,  hide and                                                                    
     skull as applicable.                                                                                                       
     This subsection  will provide an incentive  for persons                                                                    
     who have  unlawfully taken a  big game animal  and wish                                                                    
     to turn  themselves in. This protects  hunters who want                                                                    
     to   do  the   right  thing   from  paying   additional                                                                    
     restitution amounts.                                                                                                       
     A new  subsection (d) provides for  restitution amounts                                                                    
     under this  section to be adjusted  for inflation every                                                                    
     5 years, beginning in 2023.                                                                                                
                                                                                                                                
2:03:46 PM                                                                                                                    
                                                                                                                                
Major Chastain reviewed Section 20 through 24:                                                                                  
                                                                                                                                
     Section 20 Under AS 16.05.940  (38) a new definition is                                                                    
     added. This  paragraph defines "electronic form"  as it                                                                    
     pertains  to  section  3   under  AS  16.05.330(g).  It                                                                    
     provides  for   display  of  [license]  images   on  an                                                                    
     electronic device  such as  a mobile  telephone, tablet                                                                    
     or computer  that will satisfy  the display  of fishing                                                                    
     and hunting licenses.                                                                                                      
     Section 21  Under AS 16.10.030 "penalty  for violations                                                                    
     of  AS  16.10.010-AS   16.10.050"  this  subsection  is                                                                    
     amended  to  provide  that a  person  who  violates  AS                                                                    
     16.10.010 through AS  16.10.050 is guilty of  a Class A                                                                    
     misdemeanor  and  increases   the  associated  specific                                                                    
     penalty.                                                                                                                   
                                                                                                                                
     Section   22   Under   AS  16.10.030   "penalties   for                                                                    
     violations"   and   relating   to  section   20,   this                                                                    
     subsection  provides  for  a  person  who  violates  AS                                                                    
     16.10.030  through AS  16.10.050  without any  culpable                                                                    
     mental  state  is  guilty of  a  violation  offense  as                                                                    
     provided in AS 12.55.                                                                                                      
                                                                                                                                
     Section 23 Under AS  16.10.090 "penalties for violation                                                                    
     of AS  16.10.070", this section  is amended  to reflect                                                                    
     that a person who violates  AS 16.10.070 is guilty of a                                                                    
     Class A misdemeanor as provided in AS 12.55.                                                                               
     Section 24 Under AS  16.10.090 "penalties for violation                                                                    
     of AS 16.10.070", this section  provides that a person,                                                                    
     who  without  any  culpable mental  state  violates  AS                                                                    
     16.10.070 is guilty of a  violation offence as provided                                                                    
     in AS 12.55                                                                                                                
                                                                                                                                
2:04:58 PM                                                                                                                    
                                                                                                                                
Major  Chastain  summarized  that  Sections  25  through  28                                                                    
established  violation  offenses and  standardized  offenses                                                                    
within the statute.                                                                                                             
                                                                                                                                
Major Chastain continued with Sections 29 and 30:                                                                               
                                                                                                                                
     Section 29  This section amends  the uncodified  law of                                                                    
     Alaska  to  make  it  clear that  the  act  applies  to                                                                    
     offenses that occur  on or after the  effective date of                                                                    
     the Act.                                                                                                                   
                                                                                                                                
     Section 30 Provides an effect July 1, 2018.                                                                                
                                                                                                                                
2:05:34 PM                                                                                                                    
                                                                                                                                
Representative  Wilson asked  if  the  Department of  Public                                                                    
Safety had concerns  about the changes made  in the previous                                                                    
committee. Major Chastain answered  that DPS favored most of                                                                    
the  changes  but  recommended modifying  the  penalties  to                                                                    
comply with AS.12.55.  He deferred to the  Department of Law                                                                    
(DOL) to answer the question.                                                                                                   
                                                                                                                                
Representative Wilson asked to hear from DOL.                                                                                   
                                                                                                                                
AARON  PETERSON,   CRIMINAL  DIVISION,  OFFICE   OF  SPECIAL                                                                    
PROSECUTION,   DEPARTMENT  OF   LAW  (via   teleconference),                                                                    
responded  that some  of  the changes  referred  to Class  A                                                                    
misdemeanors, but the original  bill took specific penalties                                                                    
that  were listed  and  changed the  penalty  to a  standard                                                                    
Class  A  misdemeanor. He  exemplified  Section  5 Under  AS                                                                    
16.05.430  of  the  bill  that  specified  a  non-classified                                                                    
misdemeanor  was  a   fine  of  not  more   than  $1,000  or                                                                    
imprisonment of not  more than 6 months or  both and changed                                                                    
the  penalty   to  a  standard   Class  A   misdemeanor.  He                                                                    
elaborated that  the original bill changed  the several non-                                                                    
classified  misdemeanors  throughout  Title  16  to  achieve                                                                    
uniformity  with charging  under Title  12 and  the criminal                                                                    
code in  Title 11. The  current version referred to  Class A                                                                    
misdemeanors but  created certain  fine amounts  and maximum                                                                    
incarceration  periods that  were not  uniform with  Class A                                                                    
misdemeanors under  Title 12,  which could  create confusion                                                                    
regarding  maximum  sentencing.  He  related  that  he  just                                                                    
received  an email  that  indicated  the representative  who                                                                    
offered  the  amendment  in the  previous  committee  [House                                                                    
Judiciary  Committee]  would  not  support  changes  to  the                                                                    
amendment.                                                                                                                      
                                                                                                                                
2:09:32 PM                                                                                                                    
                                                                                                                                
Co-Chair  Seaton requested  more background  information. He                                                                    
asked  DOL  to  provide   written  information  regarding  a                                                                    
spreadsheet defining Class A penalties  in other sections of                                                                    
statute and how  they were related to sections  in the bill.                                                                    
He  wanted to  determine  how the  same  penalties could  be                                                                    
applied across  the board. He  pointed to Section 21  of the                                                                    
sectional analysis reading "a person  is guilty of a Class A                                                                    
misdemeanor and increases  the associated specific penalty."                                                                    
He was  uncertain how the  language worked. He  requested an                                                                    
explanation in writing  from DOL. Mr. Peterson  did not hear                                                                    
the  questions. Co-Chair  Seaton  restated  his request  and                                                                    
questions.                                                                                                                      
                                                                                                                                
2:13:25 PM                                                                                                                    
                                                                                                                                
Mr.  Peterson  responded  that under  AS  12.55.355(b)(1)  a                                                                    
Class A  misdemeanor was punishable by  a fine of up  to $25                                                                    
thousand. The  original version  of HB  129 changed  all the                                                                    
non-classified  misdemeanors in  Title  16  and removed  the                                                                    
reference to  specific penalties (  a fine of not  less than                                                                    
$100 or  more than $500) and  replaced it with "guilty  of a                                                                    
Class  A misdemeanor  punishable under  AS 12.55".  The goal                                                                    
was  to make  Class  A misdemeanors  uniform throughout  the                                                                    
criminal code.  He detailed that  all the offenses  in Title                                                                    
11  referred  to  sentencing  in   Title  12.  The  previous                                                                    
committee had  added a new  maximum crime of  $1000 removing                                                                    
the  standardization  that  would  have been  in  place.  He                                                                    
reiterated  that the  goal was  to  provide uniformity.  Co-                                                                    
Chair  Seaton  requested  the  information  in  writing.  He                                                                    
wanted to compare other Class A misdemeanors as well.                                                                           
                                                                                                                                
2:16:16 PM                                                                                                                    
                                                                                                                                
Representative Tilton pointed to  Section 18 that related to                                                                    
penalties  for  a  violation and  heard  that  Mr.  Peterson                                                                    
stated that  some penalties for  violations increased  by 50                                                                    
percent.  She  wondered  if  a  formula  had  been  used  to                                                                    
determine  the  increases.   Major  Chastain  answered  that                                                                    
Section 18 dealt  with restitution for big  game animals. He                                                                    
explained that Section 18 was  enacted in 1984 and had never                                                                    
been  adjusted for  inflation. The  original  fine had  been                                                                    
$2,016 and  the bill assessed  a 50 percent  increase across                                                                    
the board. Some of the  amounts were higher than 50 percent,                                                                    
which  reflected  a  previous committee's  belief  that  the                                                                    
animals were  worth more. Representative Tilton  asked about                                                                    
the electronic  license form. She wondered  whether a person                                                                    
would  be required  to have  a  license with  them on  their                                                                    
device if  electronic licensing was adopted.  Major Chastain                                                                    
answered  in   the  affirmative.   He  clarified   that  the                                                                    
electronic licensing format was  under development. The bill                                                                    
allowed for  individuals to carry an  electronic license. He                                                                    
furthered that  when the Department  of Fish and  Game (DFG)                                                                    
had  the  ability to  create  the  electronic licensing  the                                                                    
provision in HB 120 would apply.                                                                                                
                                                                                                                                
2:19:44 PM                                                                                                                    
                                                                                                                                
Representative  Wilson  asked  why  she  could  not  take  a                                                                    
picture  of  her  license  and count  it  as  an  electronic                                                                    
version.  Major   Chastain  answered  that  it   may  be  an                                                                    
acceptable option in the future.  The problem was related to                                                                    
hunting and  fishing tags that  needed to be written  on the                                                                    
back  of  licenses.  The recording  requirements  determined                                                                    
whether  the individual  complied with  the law  and changes                                                                    
could  be   problematic.  Representative  Wilson   asked  if                                                                    
recording requirements  were not required  would individuals                                                                    
have to  wait for regulations to  be written to find  out if                                                                    
photographs  of  licenses  were acceptable.  Major  Chastain                                                                    
answered that  licensing was developed  by DFG  and whatever                                                                    
format was chosen was acceptable  to DPS. If a photograph of                                                                    
the  license was  acceptable for  fishing without  reporting                                                                    
requirements it would be satisfactory for enforcement.                                                                          
                                                                                                                                
2:21:33 PM                                                                                                                    
                                                                                                                                
Representative   Tilton  asked   about  the   effective  and                                                                    
applicability  date  of July  1,  2018  in relation  to  the                                                                    
increase in fines.  Major Chastain answered that  the July 1                                                                    
timeframe was to get the  provisions implemented. He offered                                                                    
that  many changes  were simple  and for  the most  part all                                                                    
the changes could  be implemented by the July  1 date except                                                                    
for two pieces:  Section 4 relating to  proof of eligibility                                                                    
for  a Class  5a license.  The other  related to  electronic                                                                    
licensing.  He  restated  that the  bill  provided  a  legal                                                                    
mechanism for  electronic licenses to be  available once DFG                                                                    
developed them.                                                                                                                 
                                                                                                                                
Vice-Chair Gara  appreciated the bill. He  had two concerns.                                                                    
He  asked  if the  bill  addressed  subsistence permits.  He                                                                    
thought  it could  be a  crime if  a subsistence  permit was                                                                    
left  at home.  Major Chastain  answered that  a subsistence                                                                    
permit  was  not  a  sport  fishing,  hunting,  or  trapping                                                                    
license.   He  delineated   that  subsistence   permits  had                                                                    
reporting requirements  on the  permit and must  be reported                                                                    
before leaving the fishing sight.                                                                                               
                                                                                                                                
2:24:33 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara stated that a  mistake was a mistake. He did                                                                    
not  like making  something  that was  an  honest mistake  a                                                                    
crime.  He  announced his  other  issue  with the  bill.  He                                                                    
recalled  that  a  violation  was  recorded  on  a  person's                                                                    
record,  whereas a  fine was  not. He  wondered whether  DPS                                                                    
agreed with changing the violations  to fines. He emphasized                                                                    
that forgetting a  permit at home was an  honest mistake and                                                                    
a  violation made  the mistake  appear like  a crime.  Major                                                                    
Chastain  replied   that  violations  were  recorded   as  a                                                                    
violation, like  a speeding ticket. He  commented that there                                                                    
were a variety of items that  could be seen and showed up on                                                                    
Court View like a  speeding ticket. Violations were distinct                                                                    
from  misdemeanors and  had less  penalties associated  with                                                                    
them. He  mentioned that it  would be a policy  call whether                                                                    
the  legislature chose  to change  the  category of  offense                                                                    
from a violation to a fine  however, it was still a criminal                                                                    
offense. He deferred to Mr. Peterson.                                                                                           
                                                                                                                                
Mr.  Peterson elaborated  that  minor  fishing offenses  had                                                                    
been   described  by   Alaskan  courts   as  "quasi-criminal                                                                    
offenses to  non-criminal violations". A violation  was only                                                                    
punishable  by a  fine  under  AS 12.53.505  of  up to  $500                                                                    
unless  the statute  had a  specified fine.  Under 12.55.135                                                                    
related  to sentences  of  imprisonment  the statute  stated                                                                    
that there was  no term of imprisonment for  a violation. He                                                                    
noted  that  part of  the  bill's  action created  a  second                                                                    
level, lower-level  offense so  a person  did not  receive a                                                                    
criminal conviction  for a misdemeanor and  received a minor                                                                    
offense which was equivalent to a traffic infraction.                                                                           
                                                                                                                                
2:28:43 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara did  not believe  it was  quasi-criminal to                                                                    
forget a license at home.  He asked whether an infraction or                                                                    
fine  was  the term  for  an  offense  that was  not  quasi-                                                                    
criminal. Mr. Peterson  answered he was not  familiar with a                                                                    
term  that  would  be  used   in  criminal  law  other  than                                                                    
violation.  He  understood  that  a  quasi-criminal  offense                                                                    
could  carry  a negative  connotation  because  of the  word                                                                    
criminal, but, a speeding ticket  was a criminal offense and                                                                    
was a more  accurate equivalent. He remarked that  a "fix it                                                                    
ticket" was a possibility. Vice-Chair  Gara found the fix it                                                                    
ticket  idea  more  appealing.  He  asked  for  details  and                                                                    
whether  the ticket  disappears from  records once  proof of                                                                    
the license was produced.                                                                                                       
                                                                                                                                
Major Chastain responded  that the fix it  ticket idea would                                                                    
allow a person to present the  license within 30 days and it                                                                    
would not be on their  record; there was no associated fine.                                                                    
He delineated that there  were requirements under regulation                                                                    
that   the  Board   of  Fish   had  enacted   for  recording                                                                    
requirements and  varied among the different  permits handed                                                                    
out by  DFG. There were  30,000 people participating  in dip                                                                    
netting  across the  state. Some  of the  individuals forgot                                                                    
their  permits.  The  fishers were  required  to  carry  the                                                                    
license  while  fishing  and  record  their  fish  prior  to                                                                    
leaving  the fishing  sight. Wildlife  enforcement officer's                                                                    
carryout enforcement according to regulation.                                                                                   
                                                                                                                                
2:32:30 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara  asked if Section  3 allowed for  the chance                                                                    
to produce  the license  within 30 days  and the  record was                                                                    
erased. Major  Chastain answered  that Section 3  provided a                                                                    
mechanism  for  an  Alaskan  Wildlife   Trooper  to  make  a                                                                    
correctable citation for not having  a hunting, trapping, or                                                                    
sport  fishing license  in one's  possession and  was erased                                                                    
with  proof   and  it   became  an   officially  correctable                                                                    
citation. The  troopers had been operating  under the quasi-                                                                    
legal   mechanism  of   unofficially  allowing   correctible                                                                    
citations  over the  years. He  indicated  that DOL  advised                                                                    
that the  action was not  legal. The section provided  for a                                                                    
legal  mechanism  for   correctible  citations  for  certain                                                                    
offenses.  Vice-Chair Gara  had  a problem  with the  30-day                                                                    
timeframe.   He  asked what  constituted a  violation. Major                                                                    
Chastain responded that  30 days was the  standard for other                                                                    
correctible citations  like motor  vehicle insurance  and if                                                                    
proof  was   not  presented  after   30  days  it   was  not                                                                    
correctable.                                                                                                                    
2:35:26 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara asked  if the offense became  a violation if                                                                    
the  individual  failed to  provide  proof  within 30  days.                                                                    
Major  Chastain  responded that  it  would  be considered  a                                                                    
violation  offense. Vice-Chair  Gara appreciated  Section 3,                                                                    
but it did  not address the subsistence  problem. He related                                                                    
that many  people hunt  or fish in  the wilderness  for more                                                                    
than  30  days  and  the  limit  was  burdensome  for  rural                                                                    
residents. He believed that people were being punished.                                                                         
                                                                                                                                
2:37:16 PM                                                                                                                    
                                                                                                                                
Representative  Guttenberg asked  what  went  on a  person's                                                                    
record  that did  not produce  the license  within 30  days.                                                                    
Major  Chastain  responded that  the  record  appeared as  a                                                                    
violation offense. He explained  that the violation appeared                                                                    
on the  DPS record system, Alaska  Public Safety Information                                                                    
Network (APSIN)  and showed up  in the  non-criminal section                                                                    
as a violation  offense. The DFG offenses  was separate from                                                                    
the criminal  section and  would not show  up on  a criminal                                                                    
record. In addition, it would  be portrayed on Court View as                                                                    
a   violation  offense   with  the   amount  of   the  fine.                                                                    
Representative   Guttenberg   indicated   he  had   had   an                                                                    
experience  when dip  netting which  he relayed.  He relayed                                                                    
that  one of  the  people  he was  fishing  with forgot  his                                                                    
wallet  and  his license  could  have  been retrieved  in  5                                                                    
minutes.  The   enforcement  officer   wanted  to   write  a                                                                    
citation. He  asked whether a  ticket could be negated  if a                                                                    
person  quickly  produced  the  license  after  receiving  a                                                                    
ticket. Major  Chastain replied that  currently the  law did                                                                    
not allow for  correctable citation for a  few offenses like                                                                    
not having a hunting, fishing,  or trapping license in one's                                                                    
possession.   In  the   scenario  that   the  representative                                                                    
presented  he  reported  that   Board  of  Fish  regulations                                                                    
required possession,  immediate record keeping,  and cutting                                                                    
the fish's  tail for dip  netting. He hoped a  trooper would                                                                    
use common sense  and wait for the evidence and  not issue a                                                                    
citation.                                                                                                                       
                                                                                                                                
2:41:16 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster OPENED Public Testimony.                                                                                        
                                                                                                                                
2:41:43 PM                                                                                                                    
                                                                                                                                
MARTIN  STEPETIN, SELF,  JUNEAU, reported  that he  had been                                                                    
pulled over  a couple  of times  where he  did not  have his                                                                    
insurance card with him but was  able to offer proof. He was                                                                    
trying  to become  a  member  of the  National  Guard and  a                                                                    
violation would  make his acceptance  into the  guard almost                                                                    
impossible. He supported the fix it ticket provision.                                                                           
                                                                                                                                
2:43:46 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster CLOSED public testimony.                                                                                        
                                                                                                                                
2:43:54 PM                                                                                                                    
                                                                                                                                
Representative Kawasaki  referred to  the bill related  to a                                                                    
$5  fee  applied  to low  income  residents  and  additional                                                                    
reduced fee  language in Section  4. He  referenced language                                                                    
regarding  proof  of  eligibility before  purchasing  a  low                                                                    
income  license in  Section 5.  He  asked where  individuals                                                                    
purchased a license.                                                                                                            
                                                                                                                                
BRUCE  DALE, DIRECTOR,  DIVISION  OF WILDLIFE  CONSERVATION,                                                                    
DEPARTMENT    OF    FISH    AND   GAME,    ANCHORAGE    (via                                                                    
teleconference),  answered that  currently  a person  merely                                                                    
had to check  a box on the form and  provide a signature for                                                                    
eligibility, which  could be  proven later  by a  trooper or                                                                    
interested  party. He  explained that  proof of  eligibility                                                                    
was  added in  a  previous committee  due  to suspicions  of                                                                    
abuse. The department had discovered  that the proportion of                                                                    
purchases  for the  $5 license  reflected the  proportion of                                                                    
the   public  receiving   some  type   of  assistance.   The                                                                    
department did  not believe  that wide  spread abuse  of the                                                                    
low-income  license was  happening. Representative  Kawasaki                                                                    
asked whether  a store like  Fred Meyer selling  the license                                                                    
would  need some  proof of  eligibility  for the  low-income                                                                    
license.  Mr.  Dale answered  that  DFG  also had  the  same                                                                    
question regarding the amendment.  He was uncertain what the                                                                    
proof  would look  like and  the amendment  did not  specify                                                                    
what was acceptable proof.                                                                                                      
                                                                                                                                
Co-Chair Foster  set an amendment  deadline of 5:00  p.m. on                                                                    
Friday.                                                                                                                         
                                                                                                                                
HB  129  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
HOUSE BILL NO. 277                                                                                                            
     "An  Act  relating  to   the  regulation  of  broadband                                                                    
     Internet;  and  making  certain  actions  by  broadband                                                                    
     Internet service  providers unlawful acts  or practices                                                                    
     under the  Alaska Unfair  Trade Practices  and Consumer                                                                    
     Protection Act."                                                                                                           
                                                                                                                                
2:47:52 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SCOTT  KAWASAKI,   SPONSOR,  introduced  the                                                                    
bill.  He stressed  that technology  had changed  rapidly in                                                                    
the  past  ten  years.  He explained  that  since  1996  the                                                                    
internet   was  governed   under   a   system  called   "net                                                                    
neutrality". The bill required  internet providers to engage                                                                    
in the  practice of net  neutrality. He read from  a sponsor                                                                    
statement (copy on file):                                                                                                       
                                                                                                                                
     HB 277 would require  Internet Service Providers (ISPs)                                                                    
     who  provide  broadband  Internet to  Alaskan  families                                                                    
     engage  in the  practice  of net  neutrality. The  bill                                                                    
     would make  sure all  data on  the Internet  is treated                                                                    
     equally.  It   would  protect  small   businesses  from                                                                    
     uncompetitive practices and guarantee  an open and free                                                                    
     internet for all users.                                                                                                    
                                                                                                                                
     Without  net  neutrality,  ISPs may  legally  speed  up                                                                    
     certain  sites,  slow  down  others,  block  sites  all                                                                    
     together,  and require  certain users  to pay  more for                                                                    
     Internet fast lanes. The  elimination of net neutrality                                                                    
     gives  ISPs  the  power   to  determine  what  websites                                                                    
     consumers   could  visit   and  what   content  website                                                                    
     creators  could share.  Allowing  ISPs to  discriminate                                                                    
     based on  content undermines a  free and  open Internet                                                                    
     as well  as a  free and  open society.  Eliminating net                                                                    
     neutrality  risks Alaskans  First  Amendment rights  of                                                                    
     free  speech, free  press,  and  free association,  the                                                                    
     right to privacy, and distorts the free market.                                                                            
                                                                                                                                
     On  multiple  occasions,  millions  of  Americans  have                                                                    
     publicly   commented  in   favor   of  protecting   net                                                                    
     neutrality  and  have  spoken out  against  the  recent                                                                    
     Federal  Communications Commission  order to  eliminate                                                                    
     net neutrality rules implemented  in 2015. The internet                                                                    
     is a  modern necessity for individuals  and businesses.                                                                    
     Net neutrality  is widely supported by  consumer rights                                                                    
     groups, privacy groups, and businesses organizations.                                                                      
                                                                                                                                
     This  bill would  ensure that  the  Internet remains  a                                                                    
     platform  for  unrestricted  economic  competition  and                                                                    
     free   communication.  I   respectfully  request   your                                                                    
     support for HB 277.                                                                                                        
                                                                                                                                
Representative  Kawasaki  shared  that  net  neutrality  was                                                                    
supported by  millions of people  in the United  States (US)                                                                    
and worldwide.  He indicated that  it was also  a bipartisan                                                                    
issue; 88 percent of Democrats,  71 percent of Independents,                                                                    
and 67  percent of Republicans supported  net neutrality. He                                                                    
believed that net neutrality should  be protected. He listed                                                                    
the support  of various  national groups from  the political                                                                    
spectrum that  supported net  neutrality and  maintaining an                                                                    
open and free internet.                                                                                                         
                                                                                                                                
2:52:11 PM                                                                                                                    
                                                                                                                                
Representative Wilson  needed more  detail on the  bill. She                                                                    
wondered   about   the   definition   of   net   neutrality.                                                                    
Representative  Kawasaki characterized  the  internet as  an                                                                    
information highway  and guaranteed the essential  idea that                                                                    
everybody had the same access  as everybody else - no matter                                                                    
what   car  one   drove.   Large   corporations  and   small                                                                    
independent  businesses  had  access to  the  same  internet                                                                    
speed,   accessibility,   and   rates  as   everyone   else.                                                                    
Representative Wilson  spoke about computer  games requiring                                                                    
high  speed  internet  and  other  users  that  only  viewed                                                                    
documents; she wondered whether  both types of accessibility                                                                    
would be charged the same amount of money.                                                                                      
                                                                                                                                
JACOB   GERRISH,  STAFF,   REPRESENTATIVE  SCOTT   KAWASAKI,                                                                    
answered in the  affirmative and furthered that  it was more                                                                    
complicated. He  provided a scenario of  a broadband company                                                                    
who  owned a  video game  company and  could prioritize  the                                                                    
internet for their video games;  it was about specific sites                                                                    
and not only different types of services.                                                                                       
                                                                                                                                
Mr. Gerrish reviewed the sectional analysis (copy on file):                                                                     
                                                                                                                                
     Section 1:  Adds a new  Internet neutrality  section to                                                                    
     AS 42.05,  The Alaska  Public Utilities  Regulatory Act                                                                    
    that requires Internet Service Providers (ISPs) to:                                                                         
     ? Disclose  network management  practices, performance,                                                                    
     and  commercial  terms  so   that  consumers  can  make                                                                    
     informed decisions                                                                                                         
     ?  Not block,  impair,  prioritize,  or interfere  with                                                                    
     Internet access, website content, or Internet traffic                                                                      
     Provides  for  an  exception   to  the  restriction  on                                                                    
     prioritization if  the Regulatory Commission  of Alaska                                                                    
     finds  that such  an action  would  benefit the  public                                                                    
     interest.                                                                                                                  
                                                                                                                                
     Section  2: AS  45.50.471, adds  violation of  Internet                                                                    
     neutrality to  the list of unlawful  acts and practices                                                                    
     in  the  Alaska  Unfair Trade  Practices  and  Consumer                                                                    
     Protection Act                                                                                                             
                                                                                                                                
     Section 1: Applicability  section for contracts entered                                                                    
     after the effective date of  this bill. HB 277 does not                                                                    
     apply to  contracts entered between ISPs  and consumers                                                                    
     before that date.                                                                                                          
                                                                                                                                
2:55:35 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton  understood that consumers had  the right to                                                                    
buy a particular  internet speed, which was  not impacted by                                                                    
the bill.  The bill would  safeguard that an  individual who                                                                    
purchased an  internet speed  of 10  GB (gigabyte)  would be                                                                    
the same speed  for every website the  individual viewed. It                                                                    
would  not be  throttled down  for a  specific game  site or                                                                    
advertiser. He  surmised the bill prevented  the provider of                                                                    
internet service  from changing  the speeds of  the products                                                                    
that could  be received. He  asked whether he  was generally                                                                    
correct.  Mr. Gerrish  replied that  the  remarks were  very                                                                    
close to accurate.  He used the example  of the Trans-Alaska                                                                    
Pipeline System (TAPS) where a  large corporation or a small                                                                    
oil  producer  had  the  same  access,  which  encouraged  a                                                                    
smaller company to possibly become  a larger company via the                                                                    
access.  Co-Chair Seaton  hypothesized  that net  neutrality                                                                    
was comparable to  all the producer's oil  travelling in the                                                                    
pipe  at the  same speed  versus Alyeska  choosing preferred                                                                    
providers oil that would travel  to Valdez faster than other                                                                    
companies  oil. He  asked whether  the example  was correct.                                                                    
Mr. Gerrish replied in the affirmative.                                                                                         
                                                                                                                                
2:58:50 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster OPENED public testimony.                                                                                        
                                                                                                                                
MIKE  ROBINSON, ALASKA  LIBRARY ASSOCIATION,  ANCHORAGE (via                                                                    
teleconference),  spoke in  support  of  net neutrality.  He                                                                    
elaborated  that  libraries  supported  net  neutrality  for                                                                    
equitable  access  and  intellectual  freedom  reasons.  The                                                                    
library was often the gateway  to the internet for community                                                                    
members.  Libraries offered  access to  subscription content                                                                    
services   such  as   e-books,   newspapers,  and   academic                                                                    
journals. The  ability of internet providers  to offer "fast                                                                    
lane" service for content providers  who were willing to pay                                                                    
a premium  price undermined the equitable  access principle.                                                                    
He acknowledged  that some believed that  market competition                                                                    
would  ensure equitable  access  and  commented that  market                                                                    
competition for  broadband did not  exist in many  places in                                                                    
Alaska.   He   believed   that   net   neutrality   promoted                                                                    
intellectual  freedom  by  providing  equal  access  to  all                                                                    
speech regardless of  type or origin. He  wanted to prohibit                                                                    
broadband  companies  from  the ability  to  make  decisions                                                                    
regarding what  content was promoted  or limited  and remain                                                                    
gateways and not gatekeepers.                                                                                                   
                                                                                                                                
3:01:22 PM                                                                                                                    
                                                                                                                                
MARY JO  TORGESON, ANCHORAGE PUBLIC LIBRARY,  ANCHORAGE (via                                                                    
teleconference),  testified  in  support of  the  bill.  She                                                                    
informed committee members that  libraries provided free and                                                                    
open access  to information and net  neutrality allowed that                                                                    
to  happen.  She cautioned  that  without  the bill  utility                                                                    
companies  would   choose  to   limit  access   even  though                                                                    
providers  would promise  to abide  by  net neutrality.  She                                                                    
appreciated  the proactive  approach to  protecting internet                                                                    
access  via the  legislation. She  voiced that  the internet                                                                    
was one  of the primary  ways information was  delivered and                                                                    
it  was  vital that  providers  were  not able  to  control,                                                                    
limit, or manipulate the  content. Libraries offered freedom                                                                    
of access and she supported the legislation.                                                                                    
                                                                                                                                
Representative Wilson  asked if there  had been a  change in                                                                    
the internet at the  library since the Federal Communication                                                                    
Commission  (FCC)  change.  Ms. Torgeson  replied  that  the                                                                    
ruling took  place later in  April. She provided  an example                                                                    
related to a  grocery store endcap shelf space  offered at a                                                                    
greater price to  describe the impact if  net neutrality was                                                                    
lost. She  related that she  had not experienced  any change                                                                    
in  internet service  and remembered  that  GCI promised  to                                                                    
protect net  neutrality. She  commented that  protecting net                                                                    
neutrality should be up to the government, not a provider.                                                                      
                                                                                                                                
3:04:36 PM                                                                                                                    
                                                                                                                                
EVELYN   TREFON,   SELF,  NEWHALEN   (via   teleconference),                                                                    
testified  in   favor  of  the   bill.  She   believed  that                                                                    
maintaining   net neutrality  in Alaska  was of  the "utmost                                                                    
importance."  She  worried what  would  happen  to her  home                                                                    
internet  if  GCI decided  to  abandon  net neutrality.  She                                                                    
shared  that she  currently  paid $220  per  month for  only                                                                    
60gb.  She believed  internet should  be  available for  all                                                                    
Alaskans at reasonable rates and speeds.                                                                                        
                                                                                                                                
3:05:43 PM                                                                                                                    
                                                                                                                                
MARTIN STEPETIN,  SELF, JUNEAU, testified in  support of the                                                                    
legislation.  He believed  that  net neutrality  was at  the                                                                    
forefront of the  first amendment and free  speech. He noted                                                                    
that   GCI  was   owned  by   a   much  larger   non-Alaskan                                                                    
corporation;  Liberty Interactive.  He  shared  that he  had                                                                    
written  to  Senators Lisa  Murkowski  and  Dan Sullivan  in                                                                    
opposition  to  the FCC  ruling  and  congresses actions  to                                                                    
repeal net  neutrality laws.  He voiced  that the  state was                                                                    
currently not  protected by any  federal laws  governing net                                                                    
neutrality and  believed the state  must act to  protect its                                                                    
broadband.  He believed  that  history demonstrated  service                                                                    
providers would "violate  basic laws when left  to their own                                                                    
devices".  He relayed  that AT&T  blocked iPhone  users from                                                                    
using SKYPE in  2007 and in 2005 a  Canadian company blocked                                                                    
users trying  to organize a  labor strike. He  could provide                                                                    
many other examples. He emphasized  that the state must take                                                                    
measures   to  protect   its   citizens   from  losing   net                                                                    
neutrality.                                                                                                                     
                                                                                                                                
3:09:04 PM                                                                                                                    
                                                                                                                                
LEON JAIMES, SELF, ANCHORAGE  (via teleconference), spoke in                                                                    
support  of  the bill.  He  had  worked in  the  information                                                                    
technology field for  20 years and worked  as an information                                                                    
security  consultant. He  believed net  neutrality protected                                                                    
businesses in  the state from  the "pay to  play" practices.                                                                    
He believed  that without  net neutrality,  regulation, free                                                                    
speech, and  privacy were  at risk.  He elucidated  that net                                                                    
neutrality  played a  vital role  in  ensuring that  service                                                                    
providers did  not engage in  collecting large sets  of data                                                                    
that  lead  to individual's  personal  data.  He pointed  to                                                                    
recent  abuse of  user privacy  by  Cambridge Analytica  and                                                                    
Facebook and did  not want internet providers  to access the                                                                    
same  information.   He  expressed  concern  about   how  an                                                                    
individual's data  content would be catalogued  and recorded                                                                    
in order to  be billed under the ruling. He  relayed that it                                                                    
was challenging  for business to protect  the information it                                                                    
collected, and the  ruling would make it  more difficult. He                                                                    
supported implementing net neutrality in Alaska.                                                                                
Co-Chair Foster CLOSED public testimony.                                                                                        
                                                                                                                                
3:11:55 PM                                                                                                                    
                                                                                                                                
Co-Chair  Foster  noted  there   were  two  members  of  the                                                                    
Regulatory Commission  of Alaska  (RCA) online. He  asked if                                                                    
they had comments.                                                                                                              
                                                                                                                                
DAVID  PARRISH,  COMMON  CARRIER SPECIALIST  IV,  REGULATORY                                                                    
COMMISSION   OF  ALASKA   (via   teleconference),  did   not                                                                    
currently  have remarks.  The commission  did  not yet  know                                                                    
what would be required of  them to implement net neutrality.                                                                    
He  stated that  the RCA  was uncertain  whether they  would                                                                    
have any  jurisdiction in the  matter considering  the FCC's                                                                    
recent ruling.                                                                                                                  
                                                                                                                                
Representative  Guttenberg stated  that  the  FCC had  taken                                                                    
some of the authority away  from the states. He asked, "what                                                                    
authority the  state had  to control  what the  state does."                                                                    
Mr. Parrish  answered that  New York  and Montana  had taken                                                                    
executive  action to  ensure that  any state  contracts with                                                                    
broadband service  providers would  have to comply  with net                                                                    
neutrality  provisions. He  thought  that  states could  use                                                                    
right-of-way permissions  in the same manner.  He determined                                                                    
that  there were  other avenues  the state  could take  that                                                                    
would not "implicate" federal preemption.                                                                                       
                                                                                                                                
3:15:10 PM                                                                                                                    
                                                                                                                                
Representative Kawasaki  stated the bill  would specifically                                                                    
prohibit  decreasing, blocking,  or interfering  in internet                                                                    
service. He reported  that subsection (c) of  the bill dealt                                                                    
specifically   with  the   RCA   regarding  telehealth   and                                                                    
telemedicine  what would  benefit  the  public interest.  He                                                                    
asked  for the  RCA's interpretation.  Mr. Parrish  believed                                                                    
Representative  Kawasaki was  referencing to  subsection (c)                                                                    
and the language " The  commission may waive the prohibition                                                                    
in  (b)(3).   He  guessed that  it applied  to the  types of                                                                    
services that had a public  service aspect if a carrier felt                                                                    
that they  had to  affect other users  access to  enable the                                                                    
public service; it would allow  carriers to make appropriate                                                                    
network management decisions. The  commission would have the                                                                    
ability to waive  prohibitions in the act when  it was found                                                                    
in  the  public's  interest. Representative  Kawasaki  asked                                                                    
whether the  commission viewed services relating  to health,                                                                    
education, and  public safety in the  public interest versus                                                                    
kids playing games on the  internet. Mr. Parrish answered in                                                                    
the affirmative. He elaborated  that it would allow carriers                                                                    
to  make   the  decisions   without  running  foul   of  the                                                                    
prohibitions on the bill.                                                                                                       
                                                                                                                                
3:18:09 PM                                                                                                                    
                                                                                                                                
Representative Wilson  asked what complaints  the commission                                                                    
had that would fall under  net neutrality. Mr. Parrish asked                                                                    
for  clarification.  Representative  Wilson  referenced  the                                                                    
fiscal  note analysis  on  page 2  that  mentioned over  450                                                                    
consumer complaints per  year with the bill adding  up to 85                                                                    
more. She asked what type of complaints were received.                                                                          
                                                                                                                                
JONATHAN  CLEMENT, ATTORNEY,  CIVIL DIVISION,  DEPARTMENT OF                                                                    
LAW (via  teleconference), replied  that the  department had                                                                    
not  tried to  decide on  the  type of  complaints they  may                                                                    
receive  regarding net  neutrality.  There was  anticipation                                                                    
that  additional  complaints  may   come  in  due  to  media                                                                    
coverage of the  bill and noted that the number  was a rough                                                                    
estimate.                                                                                                                       
                                                                                                                                
Co-Chair Foster  set an amendment  deadline of 5:00  p.m. on                                                                    
Friday.                                                                                                                         
                                                                                                                                
HB  277  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
Co-Chair  Foster reviewed  the  schedule  for the  following                                                                    
day.                                                                                                                            
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
3:21:10 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:21 p.m.                                                                                          
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
HB 277 Opposition letter .pdf HFIN 4/4/2018 1:30:00 PM
HB 277
HB 277 ATT Opposition 4.2.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 277
HB 398 Additional Documents - 2015 Indirect Expenditure Report-Public Utility Exemption.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Sponsor Statement 4.3.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Additional Documents - Legisative Legal Opinion.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Sectional Analysis v.D 4.3.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Additional Documents - Dept. of Revenue Letter of Explaination 4.3.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 277 Letters of Support.pdf HFIN 4/4/2018 1:30:00 PM
HB 277
HB277 Letter of Opposition - House Finance.pdf HFIN 4/4/2018 1:30:00 PM
HB 277