Legislature(1995 - 1996)
04/24/1995 01:12 PM House JUD
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE
April 24, 1995
1:12 p.m.
MEMBERS PRESENT
Representative Brian Porter, Chairman
Representative Joe Green, Vice Chairman
Representative Con Bunde
Representative Bettye Davis
Representative Al Vezey
Representative Cynthia Toohey
Representative David Finkelstein
MEMBERS ABSENT
None
COMMITTEE CALENDAR
HB 226: "An Act permitting the provision of different retirement
and health benefits to employees based on marital
status."
PASSED OUT OF COMMITTEE
SB 3: "An Act relating to an antitrust exemption for persons
engaged in the fishing industry."
PASSED OUT OF COMMITTEE
HJR 40: Proposing an amendment to the Constitution of the State
of Alaska repealing provisions establishing and relating
to the budget reserve fund.
PASSED OUT OF COMMITTEE
HB 35: "An Act relating to sexual misconduct as grounds for
imposing disciplinary sanctions on persons licensed by
the State Medical Board."
PASSED OUT OF COMMITTEE
HB 307: "An Act prohibiting the sale of pull-tabs; and providing
for an effective date."
SCHEDULED BUT NOT HEARD
WITNESS REGISTER
REPRESENTATIVE PETE KELLY
Alaska State Legislature
State Capitol, Room 513
Juneau, AK 99801-1182
Telephone: (907) 465-2327
POSITION STATEMENT: Sponsored HB 226
MARSHA BUCK, President
Parents, Families and Friends of Lesbians and Gays (PFLAG)
8445 Kimberly Street
Juneau, AK 99801
Telephone: (907) 789-6167
POSITION STATEMENT: Testified in favor of CSHB 226
PATRICIA DOUGLAS, Member
Pharmacy Board
Chugiak, AK 99567
Telephone: (907) 688-6933
POSITION STATEMENT: Testified in favor of HB 226
TYSON NEVIL
P.O. Box 82176
Fairbanks, AK 99708
Telephone: (907) 474-4655
POSITION STATEMENT: Testified in favor of CSHB 226
MARGARET BERCK, Attorney
Alaska Chapter, American Civil Liberties Union
227 7th Street
Juneau, AK 99801
Telephone: (907) 586-3309
POSITION STATEMENT: Testified in favor of CSHB 226
MARK TUMEO
1324 Summit
Fairbanks, AK 99712
Telephone: (907) 474-6090
POSITION STATEMENT: Testified in favor of CSHB 226
JAN SIEBERTS
Alaska Bankers Association
P.O. Box 100600
Anchorage, AK 99510
Telephone: (907) 265-2991
POSITION STATEMENT: Opposed HB 226
ANNE CARPENETI, Committee Aide
House Judiciary Committee
State Capitol, Room 120
Juneau, AK 99801-1182
Telephone: (907) 465-4990
POSITION STATEMENT: Provided information on HB 226
PAM NEAL, President
Alaska State Chamber of Commerce
217 - 2nd Street, Suite 201
Juneau, AK 99801
Telephone: (907) 586-2323
POSITION STATEMENT: Opposed HB 226
THOMAS OWENS
1500 West 33rd, No. 200
Anchorage, AK 99503
Telephone: (907) 276-3963
POSITION STATEMENT: Provided information on HB 226
FRANK DILLON, Executive Director
Alaska Trucking Association
3443 Minnesota Drive
Anchorage, AK 99501
Telephone: (907) 276-1149
POSITION STATEMENT: Testified in favor of HB 226
DANIEL COLLISON, Vice President
Southeast Alaska Gay and Lesbian Association
P.O. Box 21466
Juneau, AK 99803
Telephone: (907) 789-5001
POSITION STATEMENT: Opposed CSHB 226
KATE WATTUM, Professor
University of Alaska Fairbanks
P.O. Box 84397
Fairbanks, AK 99708
Telephone: (907) 455-6639
POSITION STATEMENT: Testified in favor of HB 226
MARK NEUMAYR, Attorney
University of Fairbanks
P.O. Box 82876
Fairbanks, AK 99708
Telephone: (907) 474-7259
POSITION STATEMENT: Testified in favor of HB 226
SCHOEN PARNELL, Director
Christian Coalition
3142 Princeton
Anchorage, AK 99508
Telephone; (907) 562-1776
POSITION STATEMENT: Testified in favor of HB 226
BEVERLY MCCLENDON
P.O. Box 84397
Fairbanks, AK 99708
Telephone: (907) 455-6639
POSITION STATEMENT: Testified in favor of CSHB 226
SARAH BOESSER, Representative
Committee for Equality
P.O. Box 34202
Juneau, AK 99803
Telephone: (907) 789-9604
POSITION STATEMENT: Testified in favor of CSHB 226
TALMADGE BAILEY
P.O. Box 34542
Juneau, AK 99803
Telephone: (907) 790-2519
POSITION STATEMENT: Testified in favor of CSHB 226
SENATOR JIM DUNCAN
Alaska State Legislature
State Capitol, Room 119
Juneau, AK 99801-1182
Telephone: (907) 465-4767
POSITION STATEMENT: Introduced SB 3
KRIS NOROSZ, Executive Director
Southeast Alaska Seiners Association
P.O. Box 805
Petersburg, AK 99833
Telephone: (907) 772-4446
POSITION STATEMENT: Testified in favor of SB 3
ED CRANE, President
Commercial Fishing Agriculture Bank
2550 Denali Street, Number 1201
Anchorage, AK 99503
Telephone: (907) 276-2007
POSITION STATEMENT: Testified in favor of SB 3
RICHARD W. ISETT, Commercial Fisherman
P.O. Box 33773
Juneau, AK 99803
Telephone: (907) 789-5714
POSITION STATEMENT: Testified on SB 3
DONNA PARKER, Fisheries Specialist
Department of Commerce and Economic Development
P.O. Box 110800
Juneau, AK 99811-0800
Telephone; (907) 465-5464
POSITION STATEMENT: Testified in favor of SB 3
JERRY MCCUNE, President
United Fishermen of Alaska
211 4th Street, No. 112
Juneau, AK 99801
Telephone: (907) 586-2820
POSITION STATEMENT: Testified in favor of SB 3
DWIGHT PERKINS, Special Assistant
Office of the Commissioner
Department of Labor
P. O. Box 110700
Juneau, AK 99811-0700
Telephone: (907) 465-2700
POSITION STATEMENT: Testified in support of SB 3
JOHN BITNEY, Legislative Assistant
to Representative Terry Martin
Alaska State Legislature
State Capitol, Room 502
Juneau, AK 99801-1182
Telephone: (907) 465-3783
POSITION STATEMENT: Introduced HJR 40
JACK FARGNOLI, Senior Policy Analyst
Office of Management and Budget
Office of the Governor
P.O. Box 110001
Juneau, AK 99811-0001
Telephone: (907) 465-4678
POSITION STATEMENT: Opposed HJR 40
NEIL SLOTNICK
Department of Law
P.O. Box 110300
Juneau, AK 99811-0300
Telephone: (907) 465-6735
POSITION STATEMENT: Provided information on HJR 40
REPRESENTATIVE SEAN PARNELL
Alaska State Legislature
State Capitol, Room 515
Juneau, AK 99801-1182
Telephone: (907) 465-2995
POSITION STATEMENT: Sponsor of HB 35
CATHERINE REARDON, Director
Division of Occupational Licensing
Department of Commerce
P.O. Box 110800
Juneau, AK 99811-0800
Telephone: (907) 465-2538
POSITION STATEMENT: Provided information on HB 35
JAYNE ANDREEN, Executive Director
Council on Domestic Violence & Sexual Assault
Department of Public Safety
P.O. Box 111200
Juneau, AK 99801
Telephone: (907) 465-4356
POSITION STATEMENT: Testified in favor of HB 35
PREVIOUS ACTION
BILL: HB 226
SHORT TITLE: MARITAL STATUS AND RETIREMENT BENEFITS
SPONSOR(S): REPRESENTATIVE(S) KELLY,Rokeberg
JRN-DATE JRN-PG ACTION
03/03/95 565 (H) READ THE FIRST TIME - REFERRAL(S)
03/03/95 565 (H) STATE AFFAIRS, HES, JUDICIARY
03/18/95 (H) STA AT 10:00 AM CAPITOL 102
03/18/95 (H) MINUTE(STA)
03/20/95 808 (H) STA RPT 4DP 1AM
03/20/95 808 (H) DP: JAMES, PORTER, GREEN, IVAN
03/20/95 808 (H) AM: ROBINSON
03/20/95 808 (H) ZERO FISCAL NOTE (ADMIN/ALL DEPTS)
03/28/95 (H) HES AT 02:00 PM CAPITOL 106
03/28/95 (H) MINUTE(HES)
04/06/95 (H) HES AT 02:00 PM CAPITOL 106
04/11/95 (H) HES AT 02:00 PM CAPITOL 106
04/18/95 (H) HES AT 10:00 AM CAPITOL 106
04/18/95 (H) MINUTE(HES)
04/21/95 1422 (H) HES RPT CS(HES) NT 1DP 4NR 1AM
04/21/95 1422 (H) DP: TOOHEY
04/21/95 1422 (H) NR: G.DAVIS,BUNDE,ROBINSON,BRICE
04/21/95 1422 (H) AM: VEZEY
04/21/95 1423 (H) ZERO FISCAL NOTE (ADM) 3/20/95
04/24/95 (H) JUD AT 01:00 PM CAPITOL 120
BILL: SB 3
SHORT TITLE: ANTITRUST EXEMPTION FOR FISHERMEN
SPONSOR(S): SENATOR(S)DUNCAN, Zharoff, Hoffman, Taylor, Halford,
Lincoln, Pearce, Donley, Salo, Leman; REPRESENTATIVE(S) Ivan,
Grussendorf
JRN-DATE JRN-PG ACTION
01/06/95 13 (S) PREFILE RELEASED - 1/6/95
01/16/95 13 (S) READ THE FIRST TIME - REFERRAL(S)
01/16/95 13 (S) RES, JUD
01/17/95 35 (S) COSPONSOR: ZHAROFF
01/25/95 (S) RES AT 03:30 PM BUTROVICH ROOM 205
01/25/95 (S) MINUTE(RES)
01/27/95 (S) RES AT 03:30 PM BUTROVICH ROOM 205
01/27/95 (S) MINUTE(RES)
02/01/95 133 (S) COSPONSOR: HOFFMAN
02/03/95 (S) RES AT 03:30 PM BUTROVICH ROOM 205
02/03/95 (S) MINUTE(RES)
02/06/95 180 (S) RES RPT 5DP
02/06/95 180 (S) ZERO FISCAL NOTE (LABOR #1)
02/22/95 (S) JUD AT 01:30 PM BELTZ ROOM 211
02/27/95 (S) JUD AT 01:30 PM BELTZ ROOM 211
02/27/95 (S) MINUTE(JUD)
02/28/95 417 (S) JUD RPT 3DP 2NR
02/28/95 417 (S) ZERO FN (LABOR #1)
02/28/95 425 (S) COSPONSOR(S): TAYLOR
03/02/95 (S) RLS AT 11:25 AM FAHRENKAMP ROOM 203
03/02/95 (S) MINUTE(RLS)
03/07/95 516 (S) RULES TO CALENDAR 3/7/95
03/07/95 521 (S) READ THE SECOND TIME
03/07/95 522 (S) COSPONSOR(S):HALFORD,LINCOLN,PEARCE,
03/07/95 522 (S) DONLEY, SALO, LEMAN
03/07/95 521 (S) ADVANCED TO THIRD READING UNAN
CONSENT
03/07/95 522 (S) READ THE THIRD TIME SB 3
03/07/95 522 (S) PASSED Y18 E2
03/07/95 525 (S) TRANSMITTED TO (H)
03/08/95 632 (H) READ THE FIRST TIME - REFERRAL(S)
03/08/95 632 (H) FISHERIES, RESOURCES, JUDICIARY
03/08/95 666 (H) CROSS SPONSOR(S): GRUSSENDORF, IVAN
03/20/95 (H) FSH AT 05:00 PM CAPITOL 124
03/20/95 (H) MINUTE(FSH)
03/22/95 851 (H) FSH RPT 2DP 1NR
03/22/95 851 (H) DP: ELTON, MOSES
03/22/95 851 (H) NR: AUSTERMAN
03/22/95 851 (H) SENATE ZERO FISCAL NOTE (LABOR)
2/6/95
04/12/95 (H) RES AT 08:00 AM CAPITOL 124
04/12/95 (H) MINUTE(RES)
04/13/95 1315 (H) RES RPT 6DP 1NR
04/13/95 1316 (H) DP: NICHOLIA,DAVIES,OGAN,AUSTERMAN
04/13/95 1316 (H) DP: GREEN, WILLIAMS
04/13/95 1316 (H) NR: KOTT
04/13/95 1316 (H) SENATE ZERO FISCAL NOTE (LABOR)
2/6/95
04/24/95 (H) JUD AT 01:00 PM CAPITOL 120
BILL: HJR 40
SHORT TITLE: REPEAL BUDGET RESERVE FUND(ART IX SEC 17)
SPONSOR(S): REPRESENTATIVE(S) MARTIN
JRN-DATE JRN-PG ACTION
04/05/95 1025 (H) READ THE FIRST TIME - REFERRAL(S)
04/05/95 1025 (H) STATE AFFAIRS, JUDICIARY, FINANCE
04/18/95 1341 (H) STA RPT 3DP 4NR
04/18/95 1341 (H) DP: JAMES, PORTER, GREEN
04/18/95 1341 (H) NR: IVAN, ROBINSON, WILLIS, OGAN
04/18/95 1341 (H) FISCAL NOTE (GOV)
04/18/95 (H) STA AT 08:00 AM CAPITOL 102
04/18/95 (H) MINUTE(STA)
04/24/95 (H) JUD AT 01:00 PM CAPITOL 120
BILL: HB 35
SHORT TITLE: SEXUAL MISCONDUCT BY MEDICAL PROFESSIONAL
SPONSOR(S): REPRESENTATIVE(S) PARNELL,Bunde,Robinson,Toohey
JRN-DATE JRN-PG ACTION
01/06/95 29 (H) PREFILE RELEASED
01/16/95 29 (H) READ THE FIRST TIME - REFERRAL(S)
01/16/95 29 (H) HES, JUD, FIN
01/19/95 90 (H) COSPONSOR(S): BUNDE
02/06/95 256 (H) COSPONSOR(S): ROBINSON
04/13/95 (H) HES AT 02:00 PM CAPITOL 106
04/13/95 (H) MINUTE(HES)
04/18/95 1342 (H) HES RPT CS(HES) NEW TITLE 4DP
04/18/95 1343 (H) DP: G.DAVIS,BUNDE,TOOHEY,ROBINSON
04/18/95 1343 (H) ZERO FISCAL NOTE (DCED)
04/24/95 1485 (H) COSPONSOR(S): TOOHEY
04/24/95 (H) JUD AT 01:00 PM CAPITOL 120
BILL: HB 307
SHORT TITLE: PULL-TABS PROHIBITED
SPONSOR(S): REPRESENTATIVE(S) TOOHEY,Phillips,James,Martin
JRN-DATE JRN-PG ACTION
04/12/95 1284 (H) READ THE FIRST TIME - REFERRAL(S)
04/12/95 1284 (H) JUDICIARY, FINANCE
04/19/95 1391 (H) COSPONSOR(S): MARTIN
04/24/95 (H) JUD AT 01:00 PM CAPITOL 120
ACTION NARRATIVE
TAPE 95-50, SIDE A
Number 000
The House Judiciary Standing Committee was called to order at 1:12
p.m. on Monday, April 24, 1995. All members were present. The
hearing was teleconferenced to Petersburg, Anchorage, Fairbanks and
Chugiak. CHAIRMAN BRIAN PORTER stated that the following bills
would be heard: CSHB 226(HES), SB 3, HJR 40, and CSHB 35.
CSHB 226(HES) - MARITAL STATUS AND RETIREMENT BENEFITS
REPRESENTATIVE PETE KELLY, bill sponsor, introduced HB 226. The
superior court has recently decided that unmarried couples are
entitled to the same employment benefits as married couples. This
decision was a result of a broad interpretation of the language
found in the Human Rights Act which prohibits discrimination based
on marital status. The court concluded the human rights directive
was violated when the University of Alaska refused health benefits
to the unmarried partners of university employees. It is feared
this decision will have a far-reaching impact, and that the trickle
of grievances at the University of Alaska will become a flood in
other state agencies and finally to private industry as well. It
is not a stretch to imagine Alascom, NBA and AFL-CIO, being sued in
the near future for failing to recognize domestic partners in their
benefits packages. Because of the definition of "domestic partner"
it is not grounded in contract and tradition, as is marriage. It
is a moving target and therefore impossible to predict what future
relationships would qualify under this umbrella. The superior
court decision targets worker benefits to an unknown panoply of
partners who are able to attach themselves to state employees. HB
226 intends to reduce the uncertainty employees face as a result of
a decision in planning their compensation packages, and to pre-empt
the possible onslaught of domestic partner relationships, created
solely to gain potential benefits. He added that this is a fairly
typical change throughout statute. What HB 226 in its original
form attempted to do is found throughout statute. A judge said
there was lacking legislative intent in a particular case. Because
of that lack of legislative intent, the plaintiff was forced to
assume that the prohibition on discrimination based on marital
status was absolute. In fact, there are plenty of other examples,
placed in the packets, five that we could find immediately.
REPRESENTATIVE KELLY said the other thing is that he has had a lot
of comments about this bill. A lot of people consider it a hate
bill. The fact is if discrimination exists, he is not necessarily
convinced, but maybe that is something we need to address. It
cannot be done in this fashion, as the judge has done it, because
of the broad sweeping impact it will have on businesses and state
employees. We are setting up businesses to put a big target on
them that says, "sue me." It will be a lawyer's dream and an
administrator's nightmare, as lawyers take companies and state
agencies to task, based on perceived discrimination, and an
administrator's nightmare as they decide which domestic partner
relationship they should cover, and which they should not -
basically whose boyfriend or girlfriend gets to come in under the
umbrella. If they do not do it just right, they are going to be
sued big time. Some lawyers have said they could go back six years
because of the statute of limitations and pull class action suits
out of the hat because of this bill. He felt it was important not
to address discrimination against domestic partners in this manner,
and that we should adopt the original HB 226 before it was amended
in the HESS Committee. That was his request.
MARCIA BUCK, President, Parents, Families and Friends of Lesbians
and Gays (PFLAG), testified in favor of the CS for HB 226. PFLAG,
Juneau, was opposed to the original HB 226 because we believe it
discriminated against our sons and daughters, and friends on the
basis of marital status. At that time, we felt that to have
proceeded in this legislature with that bill that was openly
discriminatory and flew in the face of the Alaska Constitution,
appeared to us to be unthinkable and reminiscent of governments in
some other countries, past and present, where there was
discrimination against the people that the government intended to
serve. We are pleased with the CS which removes that discriminator
language, and allows our sons and daughters and family members who
enter into committed long term relationships and domestic
partnerships to accept benefits equal to those for other
partnerships such as marriage. We would not come to you for PFLAG,
asking for special rights for our family members, but we would come
to you for equal rights for family members who are gay and lesbian.
MS. BUCK said the sponsors of the bill have stated that it was
financially motivated, but we believe the CS as it now reads,
defines and places reasonable parameters on the couples for whom
benefits would be available, and does so in a manner that does not
discriminate against people simply because they are homosexual. We
believe the CS limits frivolous partnerships.
MS. BUCK explained that her daughter lives near Corvalis, and her
partner is employed by Oregon State University. She is covered
under her partner's health insurance. When they first moved to
Corvalis, they had no other health coverage, and it became crucial
that this coverage was crucial for her since she had severe allergy
problems when they first moved there. The criteria in Oregon is
less stringent than the criteria proposed in this CS. Even though
Oregon has financial difficulties, they have not found that to be
a burden on the state of Oregon. In summary, PFLAG would like to
go on the record of being in support of the HESS CS for HB 226, and
in opposition to HB 226, as originally written.
PATRICIA DOUGLAS, Member, Pharmacy Board, said this bill, working
with HB 227, will ensure that there is no misunderstanding on what
the law is in reference to health care for spouses only. The
impact is not fiscally sound for businesses in the private or
public sectors. She urged passage of these bills as originally
presented. If we allow these to be forgotten, simply because it is
an uncomfortable issue, Alaskan voters will see that you are
drawing a line as a political statement. We need to address all
issues that affect the traditional family. We need people in
Juneau that are not afraid to stand up for all that is right,
supporting traditional family values. She urged the committee's
support of the original version of HB 226.
TYSON NEVIL spoke in support of HB 226 via teleconference. He
urged this protection of families that would otherwise be denied
health benefits. Representative Kelly is asking that the bill be
changed to eliminate the partnership clauses added in the HESS
committee. If the partnership clause is dropped, the bill will be
an attempt to economically punish individuals who choose not to
marry into traditional families. Economically and emotionally
committed families come in all shapes and sizes in today's
culturally diverse America. He believed the current CS for HB 226
reflects that diversity. He urged the committee to support the CS.
The original version is an effort to impose moral values and
prejudices on all of us. The CS includes Alaskans who only want
equal protection under the law.
MARGARET BERCK, Attorney, Alaska Chapter of the American Civil
Liberties Union, spoke in support of the CS adopted by the House
HESS Committee. We believe the definition of domestic partnership
as set out in that bill, would fair it out, frivolous
relationships, and at the same time, would meet the constitutional
concerns that we believe were at issue in this bill. From
listening to other testimony that was presented before the House
HESS Committee, there was a considerable concern regarding some of
the impact that the legislation might have on private employers.
The bill will not impact private employers. There is a federal law
that essentially deals with private employers, and the state
provisions in this legislation would not turn that federal law and
the requirements that are set out in it.
MS. BERCK understood that when you are an employee at the
university, and you choose to cover your partner, that money comes
out of your paycheck. You get less money, and that virtually the
cost to the university is an administrative cost for adding on
those individual people. The employee also bears the cost with
respect to adding these individuals to the pool of insured
individuals that are related to or somehow associated with
employees at the university.
CHAIRMAN PORTER did not think that was correct, that the employee
was the one bearing the cost to add another person to the insurance
policy. He understood that while the employee would contribute to
this cost, there is an equal contribution by the employer, so that
costs proportionately go up with the amount of people covered, but
such a cost is above and beyond the administrative cost.
MS. BERCK mentioned that studies have been done in other states
where domestic partnerships are recognized and the affects that has
had on insurance costs. She felt that on the larger scheme, the
affect has not been significant.
Number 400
MARK TUMEO, Professor, University of Alaska Fairbanks, testified
via teleconference in favor of the CS. He is a litigant in the
case mentioned about the cost of health care. The expense to a
university per employee for health care insurance is approximately
$100 to $150 per month. He urged passage of the CS. The CS will
save the state money by allowing benefits for long term domestic
partners. It will allow currently uninsured individuals to access
insurance. The state will save money when uninsured individuals
get injured in public facilities. For example, an uninsured woman
who miscarries, can run up over $100,000 in medical bills. These
costs will end up being paid by Medicaid. This bill will not
affect private companies. It is clear from a recent United States
Supreme Court ruling that the Employment Retirement Income Security
Act passed in 1974, pre-empts state law as the court ruled on
benefit issues.
JAN SIEBERTS, National Bankers Association (NBA), was confused
about the language on the second page, "Not withstanding the
prohibition against employment discrimination on the basis of
marital status under (a) of this section, an employer may refuse to
provide benefits to a person because the person is not legally
married to an employee of the employer without violating this
chapter;" Does that mean we have to apply these insurance benefits
to married people just because they are married to an employee?
That is what it sounds like.
CHAIRMAN PORTER thought that on line 30, "the employer may" is the
operative provision. In other words, we are not saying that the
employer provision is saying that an employer may not provide
insurance for a traditional spouse, without violating this chapter,
unless ... no, you are right.
REPRESENTATIVE GREEN said you can refuse it unless it is (a) or
(b).
CHAIRMAN PORTER said you may have hit on something. He did not
know if it was the original intent, but we do have the Co-Chairs of
HESS here. One could read this, very strongly, that this says,
"employers will provide insurance to spouses or domestic partners."
He thought that was a contract that is within the power of the
employer to provide it or not to provide it, based on their own
agreement with their own employees.
REPRESENTATIVE TOOHEY asked if we have an attorney present.
CHAIRMAN PORTER answered that yes, we do.
ANNE CARPENETI, Committee Aide, House Judiciary Committee, stated
that the language was awkwardly drafted, but thought the purpose of
it was to say that an employer may make a choice for giving
employee benefits based on marital status if there is a marriage or
domestic partnership.
CHAIRMAN PORTER understood the law right now to allow an employer
to engage in negotiations, and not get any insurance benefits, if
that is the case.
MS. CARPENETI added that at a certain point when an employer gives
spousal benefits, then you run into the problem of the Title 18.80,
which prohibits discrimination based on marital status. This is
kind of an exception to that, the way it is drafted. It follows
the way the statute is drafted, which is a little bit awkward to
understand.
Number 525
CHAIRMAN PORTER said this then would provide that if that decision
is made, that you are going to provide health care benefits to an
employee that has a family package with it, that you are not
violating the statutory provisions of this chapter against marital
or sex discrimination, unless you say we will not provide them to
a legally married person, which is obviously contrary to the
agreement was that you already established. Also, you won't refuse
to provide them for a domestic partner as defined throughout this
section. So it does not take away the ability of an employer to
negotiate a health package. Basically, what the court decision
says is that if you give benefits to a spouse, you must give
benefits to a nonspouse. What we are saying is that a nonspouse
means a domestic partner as defined by this, so that if you have a
nonmarried relationship other than this domestic partnership, you
may discriminate against them, and not provide them with health
insurance, and you would not be violating the anti-discrimination
statute.
MR. SIEBERTS clarified that the way he understands it is that if we
give insurance to our employees under this bill, we are not
required to give the benefits to their spouses or their families.
CHAIRMAN PORTER said that is correct.
MR. SIEBERTS said they feel this will increase insurance rates to
the banks. Our institution has 1,200 employees and provides
insurance for spouses and families. Even though the employee has
to contribute partially to that additional expense, our institution
contributes substantially. If it substantially increased the cost
of providing this benefit to our employees, we will likely
eliminate the benefit to all of our employees, which, in our case
would mean an additional 2,500 people that would be uninsured.
Even for us, it is a pretty competitive world out there, and we
have to keep our pencils sharp to compete with much larger and
tougher institutions than we are, and he thought that little
businesses throughout the state would be in the same boat. You
should be aware that this could have negative repercussions on
people who are insured today. We do not want to kick those people
out of our plan; that is not the purpose.
Number 600
REPRESENTATIVE BUNDE asked how substantial the increase would be.
Would it be 15 percent, or 5 percent?
MR. SIEBERTS said he did not know an exact amount.
PAM NEAL, President, Alaska State Chamber of Commerce, stated that
the cost to expanding benefits would increase the cost to the state
of Alaska, and we have a concern considering that our number one
priority as an organization is that state spending be reduced, not
expanded. Therefore, she felt this could be a problem in that
arena. Secondly, there is confusion coming from the hearing in
HESS. We heard testimony from an attorney that said private
employers would be impacted, and yet we have testimony saying that
they will not be. We fear that private employers would be
impacted, because even if they were not affected initially, as
usually follows, there is a court case where someone sues because
the state employees would be discriminated against if they were not
covered, but private employees are not. There would be a debate
about that in court, and eventually the private employers would
come under it. But even if private employers do not come under it,
and even if we are able to continue the practice of not offering
benefits to anyone but our employee, and of course we do not even
have to offer benefits to our employees. But those reasons that
you offer benefits are all still there. You certainly like to have
employees who are enjoying the benefits of good health care,
because they are going to be better, healthier employees, and the
other factor is the loyalty that offering good benefits provides.
In this regard, we feel that the private sector is already
handicapped by the benefits that are offered by the state of
Alaska. It is quite difficult to keep employees in the private
sector here in Juneau, if there is a state job open. They are gone
to that state job immediately because we cannot compete with the
state on the benefits that they already provide. With this
expansion of benefits, it just creates a wider gap, and a greater
disparity. We are concerned that the only pool to draw private
sector employees from will become the group of those who cannot get
state jobs. She felt it would be too costly for private employers
if they tried to participate, and it is too costly for the state.
Number 740
THOMAS OWENS, Attorney, testified via teleconference. He thought
it would be worth checking to see if this legislation would be pre-
empted by (indiscernible). He said they represent some of the
workers at the University of Alaska. Judge Greene's analysis was
very straight forward. She simply said that 18.80 prohibits
discrimination based on marital status, change in marital status,
or parenthood status, in providing health care benefits. If
nothing changes, at least all state employees who are childless,
for example, could use the law to say that because the state is
paying for health care benefits for employees who have children,
that discrimination against single employees or childless employees
are entitled to the thought that the state would have to pay
compensation to these people who do not have children so that they
would be treated the same as the state is treating people who do
have children. The implications of this decision, and the path
that is before you are enormous regardless of whether it applies to
the private sector or not.
REPRESENTATIVE GREEN asked Mr. Owens what the affect would be on
private employers under the CS version.
MR. OWENS answered that the change to the bill literally creates a
married-like status for those people who are not married, as
regards health care benefits. There are over 100 provisions in
state law that allow or require discrimination based on marital
status, and the minute the bill passes, you are going to have to go
and change all of those other state laws that require
discrimination based on marital status. For example, the statutory
provisions concerning the teachers' retirement system provides that
an employee who is a participant in the teachers' retirement system
is allowed to amend their beneficiary designations to designate, as
a beneficiary, a dependent or a spouse, and it specifically uses
the term "spouse." If you have this bill creating a "contract
spouse" then you are going to have to go through the rest of the
law and create that same opportunity for contract spouses, for
example, under the teachers' retirement system. There are also
provisions that limit benefits to spouses. If you eliminate those
provisions for spouses in one statute, you will have to go through
and eliminate the provision in other related statutes.
Number 830
FRANK DILLON, Executive Director, Alaska Trucking Association,
testified via teleconference. He stated the original intent of the
association's board of directors was to support this legislation
with the idea that this piece of legislation would limit the
ability for nonmarried couples to enjoy the benefits of that
employee's benefit relationship with the state. We certainly had
not envisioned this analysis of the law being applied to the
private sector and quite frankly it has been frightening. Our
position has been to encourage the legislature not to give people
who are not married the benefits of a marriage contract. The idea
of a domestic partner further dilutes the importance of the
marriage status. We would continue with opposition to this. It
seems to be that the intent of this bill has changed a little.
REPRESENTATIVE FINKELSTEIN thought that it was intended to NOT
include private employers, and if the language was not clear
enough, it could be amended to that effect.
DANIEL COLLISON, Vice President, Southeast Alaska Gay and Lesbian
Association, responded to some of the comments that were raised by
Mr. Owens. First of all, Mr. Owens suggested that if this bill is
adopted as it is, an unmarried, childless employee of the
university could come in and justify the same type of reimbursement
equivalent to those benefits provided for those employees who are
married or who have children. That is not what the issue would ...
TAPE 95-50, SIDE B
Number 000
MR. COLLISON continued...the domestic partner status as a marriage-
like status. He would dispute that. This domestic partner bill,
though it provides for access to health care benefits does not
allow for a whole host of other benefits that is automatically
assumed when someone is married. An example of that is if he
entered into a domestic partner arrangement with somebody else,
that does not immediately assume that he has responsibility for
their children. It does not automatically assume that given that
individual guise, that he has the same access to a third of that
individual's estate that a spouse does. So a domestic partner
status is not the equivalency of marriage.
MR. COLLISON stated that in the continuing discussion of HB 226, it
is troubling to note how suppositions and allegations, rather than
recent discourse have played in this debate. Supporters of the
original bill, which denies domestic partner benefits to university
employees, speculate that such benefits will be a financial burden
to the university health care plan, and also put undue pressure on
the private sector to adopt domestic partner benefits. Supporters
of the original bill offer no empirical evidence for their ominous
predictions. When he or his friends present studies which refute
their positions, the opposition dismisses them as mere statistics
tailored to fit a preconceived conclusion. But these studies are
based, not on pie in the sky ideas of a rosy future, but on the
concrete experience of actual employers. For example, prior to the
adoption of the domestic partner benefits at the University of
Iowa, researchers speculated that enrollment in the university
health care plan would increase from a low of 2.6 percent to a high
of 8.3 percent. However, the actual experience of the university,
four years after it implemented its domestic partner benefits plan,
has been an increase in enrollment of only .2 percent. In 1985,
the city of Berkeley extended domestic partner benefits to its
employees. At that time, the Kaiser Health Maintenance
Organization with whom the city contracted for employee health
benefits, imposed a monthly surcharge. This surcharge was based on
estimates that the plan would result in more costly claims of
domestic partners. After three years of experience it was
established that the claims of domestic partners did not burden the
city's health plan. This monthly surcharge was first reduced, and
then eliminated. The experience of both the University of Iowa,
and the city of Berkeley is consistent with nearly 200 other
private businesses, public universities, and governmental employers
who have adopted domestic care benefits. These employers typically
find that enrollment edges up by only 2 percent to 5 percent. The
employers see trifling cost increases in their health plans of
between 1 percent and 3 percent. In most cases, health insurance
premiums remain the same. Representative Kelly may continue with
his dire warnings that domestic benefits burden health care plans,
but the burden of proof remains with him to present this committee
with the names of actual businesses, universities, and public
agencies who have thus suffered. Representatives from the Alaska
business community may yet warn of the pernicious influence of
domestic partner benefits on private employers, but the CS does not
even address the private sector. Even if it did, the task remains
for them to present the names of employers who have discontinued
their health plans, laid off employees, or closed their doors
rather than front the extra cost of domestic partner benefits.
MR. COLLISON mentioned that in Massachusetts and Virginia states
which have extended domestic partner benefits to public employees,
he knows of no instance where employers have restricted their
health care benefits only to employees. If proponents of this
amendment are content to cry dire warnings of a calamitous future,
they would be better to focus not on domestic partner benefits but
on state Medicaid costs. For if ours is to be a debate of
speculation and supposition, the one area of mystery is how this
amendment impacts state Medicaid costs. When an employer is
refused health care coverage for his or her domestic partner, that
partner often goes without insurance. When the same partner incurs
catastrophic health care bills and cannot cover them, the state of
Alaska steps in to foot the bill. Who among you can estimate when
such a partner will incur such bills and for how much? He urged
adoption of the HESS CS.
KATE WATTUM, Professor, University of Alaska Fairbanks, testified
via teleconference in support of HB 226 as currently written.
MARK NEUMAYR, Attorney, University of Alaska Fairbanks, said the
university prefers the original bill as opposed to the CS. The
university's position on provisions of the original bill are
consistent with the university's practice and the position taken in
the Judge Greene's superior court decision.
SCHOEN PARNELL, Director, Christian Coalition of Alaska in
Anchorage, testified via teleconference. We support Representative
Kelly's original wording for HB 226. He asked if there were any
people in the hearing with a legal background, and wondered about
Judge Greene's decision on creating a like-marital status for
domestic partners. Can that allow a class action lawsuit against
the state of Alaska or against other employers who offer benefits?
Would they be able to go after back benefits?
CHAIRMAN PORTER said we do have an attorney as an aide to the
Judiciary Committee, but the question you are asking is in a
specific body of law that we have not been able to look at in the
last half hour. There is not anyone here right now who could give
you an exact answer, but in his experience, an exact answer would
be suspicious in any event, as this is obviously a question that
could be argued from either side.
MR. PARNELL thought that with the original language, a lawsuit of
that nature could not be made, so passing the original version of
the bill would alleviate the possibility of a lawsuit.
Number 300
BEVERLY MCCLENDON testified via teleconference in support of the CS
for HB 226. This bill allows for protection of employees and their
family members. It is important to remember why the practice has
been established for health benefits for dependents. This is to
assist in the financial security of the family, thus allowing the
employee to continue being a productive member of the work force.
This security is important no matter how a family is defined.
SARAH BOESSER, Representative, Committee for Equality, testified in
support of the CS for HB 226. By incorporating financially
interdependent domestic partners into the university's health
benefit plan, this bill will no longer illegally discriminate on
the basis of marital status. Including domestic partners is one of
the recommendations made by superior court Judge Greene, and it is
wise of this body to follow nondiscrimination law in this case.
This bill will not cost the state a significant amount of money.
In fact, it may save significant money, because by allowing
employees to pay for the health care coverage of their financially
interdependent partners, more Alaskans will be covered by private
health care coverage, and there will be fewer citizens left to seek
Medicaid at state expense. The bill would not increase premium
costs to the university. There are a number of studies done by
many businesses that were provided to the HESS Committee. All find
that from 1 percent to 3 percent is the number of increase in
enrollment, with no negligible premium increase. Aetna found only
a 2 percent increase in the first year, and only a 1 percent
increase for each year following. Aetna sees no increase in
premiums as a result of domestic partners inclusion.
TALMADGE BAILEY testified in support of the CS for HB 226. We have
heard much talk about the cost of this bill. We have heard that
people will turn to sham domestic partnerships and break the state
treasury, yet studies do not support this position.
CHAIRMAN PORTER concluded the public hearing on HB 226.
REPRESENTATIVE FINKELSTEIN offered amendment one. It would change
"employer" to "public employer" on page 2, line 30, so that it will
be clear which employers this applies to. He would not mind
extending this to private employers, but since that is not the
intent of the bill, he chose to change the wording to "public
employer."
REPRESENTATIVE VEZEY objected.
REPRESENTATIVE BUNDE asked if this was intended to include all
public employers or only the University of Alaska.
REPRESENTATIVE VEZEY felt the amendment makes it much worse,
because we are setting up a standard which would make the
university subject to nondiscrimination guidelines, while allowing
other employers a different set of discrimination guidelines. We
are setting up an exclusionary statute.
REPRESENTATIVE FINKELSTEIN felt the only issue before us is public
employers.
CHAIRMAN PORTER said it is the intent of the amendment that
whatever it is we are doing here is not meant to affect the private
sector. Whether or not the private sector is vulnerable under that
case decision is not clear. That is something that would have to
be argued in court, so it is not reasonable for us to answer that
question absolutely.
REPRESENTATIVE KELLY mentioned that while he did not disagree with
the amendment, in that it did protect private industry, he would
only be satisfied with the original version of HB 226.
A roll call vote was taken. Representative Finkelstein abstained.
Representatives Vezey and Green voted no. Representatives Toohey,
Davis, Bunde and Porter voted yes. Amendment one passed with a
four to two vote.
Number 640
REPRESENTATIVE GREEN said he would like to put his name on
Representative Kelly's amendment and offer it as amendment two:
Page 1, line 2:
Delete "marital or domestic partners"
Insert "spouses"
Page 2, line 30, after "provide":
Insert "health or retirement"
Page 2, line 31, after "unless the person":
Insert "is legally married to an employee; and"
Page 3, lines 1 - 3:
Delete all material.
Page 3, line 5, after "provision of":
Insert "a health or retirement"
Page 3, line 7, through page 4, line 13:
Delete all material.
Insert "is legally married to an employee".
REPRESENTATIVE TOOHEY objected.
A roll call vote was taken. Representatives Vezey, Green and
Porter voted yes. Representatives Bunde, Finkelstein, Toohey and
Davis voted no. Amendment two failed on a four to three vote.
REPRESENTATIVE BUNDE made a motion to move CSHB 226(HESS) from
committee as amended with fiscal notes as attached.
REPRESENTATIVE DAVIS objected. A roll call vote was taken.
Representatives Vezey, Toohey, Bunde, Green and Porter voted yes.
Representatives Finkelstein and Davis voted no. CSHB 226(JUD)
passed, five to two.
SB 3 - ANTITRUST EXEMPTION FOR FISHERMEN
Number 850
SENATOR JIM DUNCAN, bill sponsor, introduced SB 3. This is the
first step in stabilizing a very important industry in this state.
It will allow fishermen to form associations to collectively
negotiate fish prices with fish processors. It provides a measure
of state anti-trust immunity for the processors when they negotiate
with fishermen, in addition. It does not allow processors to agree
among themselves on the prices they will pay fishermen. Fishermen
must always be present during those discussions, so it cannot be
one sided. In order to collectively bargain, fishermen must be
allowed to ...
TAPE 95-51, SIDE A
Number 000
SENATOR DUNCAN continued...that first of all, this does not provide
that fishermen can collectively sell a catch, or fish products,
although the corresponding federal law does expressly permit this.
SB 3 has a provision that would make state law consistent with the
federal law. Due to the incongruities between state and federal
law, some Alaska fishermen's organizations have found themselves in
compliance with federal anti-trust law, yet they are breaking state
law, or vice versa.
SENATOR DUNCAN stated this is only the first step towards
stabilizing the Alaska fishing industry. Section 2 changes
existing law by allowing fishermen to discuss prices with more than
one processor at the same meeting. After that is done, and while
it is only a first step, it will take congressional approval for a
federal anti-trust immunity. The state and the fishing industry
together could request a federal exemption. A federal exemption
would be favorable, and passage of SB 3 would put us in a position
to request that exemption.
SENATOR DUNCAN noted that the fishing industry is Alaska's largest
private employer. It affects every segment of our economy from
small coastal villages to the state's general fund. Long term
price agreements, which would result from collective bargaining
will help stabilize commercial fishing prices, bolstering local and
state economies, as well as consumer prices for seafood. He had
received many letters of support for this legislation, some of
which came from the United Fishermen, Cordova District Fishermen
United, the Bering Sea Fishermen's Association, the director of the
Alaska Commercial Fishing Agricultural Bank, the state Department
of Commerce and Economic Development and the Department of Labor.
REPRESENTATIVE VEZEY asked why we would want to go to the trouble
of making this a law if there is nothing that specifically
precludes us from doing it in the first place.
SENATOR DUNCAN answered that we cannot exempt ourselves from the
federal anti-trust law, only from state anti-trust law.
Number 150
KRIS NOROSZ, Executive Director, Southeast Alaska Seiners
Association, testified via teleconference. She said they are in
full support of SB 3. It clarifies ambiguities currently found in
state law concerning the fishermen's ability to collectively
bargain their catch. Secondly, the bill will move us closer to
obtaining a most needed federal exemption so that fishermen and
processors would be allowed to negotiate prices. Passage of SB 3
would put the state and fishing industry in a position to request
such an exemption from the federal government. This type of
progressive action is an important and very critical step towards
stabilizing commercial fish processors. The result would be
greater value for Alaska seafood products which will directly
affect the state and local economies. We appreciate the forward
thinking presented in this bill and urge support of it.
ED CRANE, President, Commercial Fishing Agriculture Bank, (CFAB)
testified via teleconference and also submitted written testimony:
"I have noted and read Senate Bill 3. In my view, SB 3 serves a
relevant and highly significant purpose.
"I have been directly or indirectly involved with individual
producers of food and fiber, and with both formal and informal
associations of such producers, for nearly 30 years. That includes
almost continuous and intense involvement with producers and
marketers of agricultural commodities of all kinds from 1965
through 1981.
"As contrasted with manufacturers, an individual producer of food
and fiber commodities is greatly disadvantaged by his or her
isolated status within what may be huge conformation of economic
forces. The producer is further made vulnerable by the limited-
life nature of most commodities and by the pressure to capture
whatever value may exist on a timely basis.
"There has probably been no more positive statutory force affecting
commodities producers than the limited anti-trust exemptions in
federal and most state statutes. While a superficial glance may
suggest they are merely the extension of privilege to a few, such
exemptions are in actuality the cornerstones of the stability which
is critical to any food production and distribution system and
which provides immeasurable benefits to each of us as consumers.
"Senate Bill 3 establishes and clarifies this important exemption
for harvesters, producers, and marketers of Alaska's seafood
resources. While it will solve no problems by itself, its
enactment will provide significant opportunities for the creation
of stabilizing forces which will benefit all of Alaska as well as
seafood industry participants.
"I would be most interested in knowing of any opportunities to
express support for Senate Bill 3."
Number 250
RICHARD W. ISETT, Commercial Fisherman, said he fishes in Bristol
Bay out of his drift/gillnet boat. He has fished there since 1986
and gave the committee a little background from an individual
fisherman's point of view. Nobody has time to sit down and
negotiate fish prices in June or July. We have about 1,700 boats
fishing in five districts in Bristol Bay and we sell to a market
that is dominated, arguably by less than ten buyers. We do not
have any way of preserving these fish past the 12 hours that we
catch them, and so when we deliver these fish, we prepare nets and
gear and wait for tenders to deliver these fish to processors.
These processors in Bristol Bay will head and gut the fish, take
the eggs, freeze them, and often deliver them in very short order
to tramp steamers that are tied up next to the processing facility.
Most of these fish go to Japan. In Japan the fish are reprocessed
since they are not in retail ready condition when they leave
Bristol Bay. Prices range from about 60 cents per pound to about
$1.20.
MR. ISETT said their relationship to processors is interesting. He
does not hold any particular allegiance, since he does not owe them
any money, but a lot of fishermen owe processors money, and he has
owed them money in the past. You can receive financial aid from
processors in the form of in-season advances, or if you have a
break down, and a new engine is a $15,000 - $20,000 event, you can
write this up on a purchase order. You do not call your banker,
you tell the processor you have broken down and need a new engine
and they help you get a new engine. He does not know many
fishermen that are not dependent upon processors during the season.
They provide net barges, logistics, helicopters, and it is quite an
operation. There are just not people running around being
independent of processors, so we are all tied to processors to one
degree or another. Furthermore, the processors increase the market
for fish, and they may put you on a limit if they cannot process
any more fish during a big season when the processors processing
capacity is taxed. Still you want a processor who has an adequate
capacity and does not put you on limit during the height of the
season.
MR. ISETT explained that there is a fishermen's meeting around June
20 in which the processors tell them how terrible the market is.
We will have a big carry over on inventory from the prior year.
That will not be the case this year, but the dollar is expensive in
relation to the yen. There are other sources of fish that are
barely attractive to the buyers, and it goes on and on. What is
established is a price that is a posted price that is put on their
fish tickets under law. Typically it is going to be a low price
that nobody worries about meeting. We are assured every year by
these processors. Every year it is the same script. They are
going to be competitive. He does not know what competition means
to them, but it does not mean the same thing to them that it means
to us. They are going to be competitive. They want the supply of
fish, and they will pay us the least amount that they think is
required to keep us fishing for them. That is basically the way
this works. When we leave Bristol Bay, we will have a settlement
at a price that is probably above the posted price, but we are all
assured that there is more money coming, maybe. We just do not
really know. This year, we have had a couple of adjustments from
Icicle Seafoods after their preliminary settlement at the time we
left the bay. We need that preliminary settlement because we pay
crew shares out of that, boat payments, and so forth. So we have
an investment of maybe a half million dollars in a boat, and it all
has to happen within a month. We have essentially no leverage in
this process. We can either fish or not fish. If we fish, we have
to deliver the fish or we cannot keep them. Another thing that
processors do is have a loyalty bonus. Loyalty bonuses discourage
competition. They tell you that if you deliver all your fish to
us, we will give you a bonus. It may be ten cents a pound. They
do not tell you in addition to what. And there may be some breaks
if you catch more than 100,000 pounds, but the so-called loyalty
bonus is part of this scheme, that they have, and it seems to work
very well. We do not negotiate with processors. They say we will
give you all of these services. We have barges, helicopters, and
all of that, but they do not talk about prices to individual
fishermen, because we need them, when we are talking about one
fisherman to processor. The closest thing he has seen to even
coming close to negotiating prices is when they had a strike in
1991 in Bristol Bay.
DONNA PARKER, Fisheries Specialist, Department of Commerce and
Economic Development, testified in support of SB 3. She stated
that the commodity markets stabilize the prices of salmon, by doing
all of the buying and selling. The Japanese would like to do this,
as they have with shrimp. What this bill helps solve is to expand
marketing, product development, consistency of price, supply and
quality.
JERRY MCCUNE, President, United Fishermen of Alaska, testified in
support of SB 3. Back in 1935, the Cordova District Fishermen
United was a union. Then the federal government told them they
could not be a union so they had to collective bargain, because
they were a group of individual business people. This section just
gives you the opportunity to bargain, it does not mean anybody is
going to bargain with you. The federal law says that you can only
talk to one processor at a time, so in order to collectively
bargain, you have to go talk to individual processors one at a
time. Section 2 would allow us under state law, to go to the
federal government and see if we can get this exemption lifted, and
the key thing is that it will allow us to talk to more than one
processor at a time in the same room, and maybe come up with some
kind of agreement.
DWIGHT PERKINS, Special Assistant, Office of the Commissioner,
Department of Labor, testified in support of SB 3. He mentioned
that under AS 16.10.280, it provides that the Department of Labor
serve as a mediator of disputes between fishers and fish processors
on the price to be paid for salmon. The department's experience
has revealed that the inability of fishers to form associations to
negotiate with processors has been a primary factor in such
disputes. This legislation would provide a mechanism to stabilize
raw fish prices, thereby protecting Alaskan fishers and processors
from the debilitating and fluctuating fish prices. A stable
fishing industry will have a direct and positive affect on Alaska's
economy. It is only reasonable that Alaska fishers and processors
have the legal ability to protect themselves in this important
resource from the price setting by outside interest.
REPRESENTATIVE BUNDE moved to pass SB 3 on with fiscal notes as
attached and individual recommendations. Hearing no objection, SB
3 passed out of committee.
HJR 40 - REPEAL BUDGET RESERVE FUND (ART IX SEC 17)
Number 700
JOHN BITNEY, Legislative Assistant, Representative Terry Martin,
sponsor of HJR 40, introduced the resolution. This started off in
the Senate as a major fiscal reform package that included other
changes to the Constitution as well as various amendments to
statute. As the package was moving through the body, and through
discussions on all facets of the package as a whole, some of the
portions became amended and some of them dropped off. What finally
went through the last night of the legislative session in 1990, was
the language that we have now in the Constitution which creates the
constitutional budget reserve (CBR). That concept was placed on
the ballot last year and was passed by the voters. Once we
actually tried to apply the language that was in the constitutional
budget reserve, it quickly became apparent that there was a lot of
ambiguity in the language in terms of how it was to be applied.
Immediately, the question came up over Section (a) of the amendment
which described which proceeds were to go into the constitutional
budget reserve. There was a key phrase in there called "all
proceeds from an administrative proceeding." The question
immediately came up as to what exactly an administrative proceeding
meant. This became a matter of contention until we received an
Attorney General's Opinion from Charlie Cole which said that we did
not take the proceeds from any administrative proceeding until it
got to the point of adjudication, where we had to go in front of a
hearing officer or the court system to resolve a dispute between
the state and a company. However, within statute, we have a
process by which most claims are settled between the state and a
company, called an informal conference. This was, by far, where
most of the settlements that come to the state actually occur.
Under the Attorney General's Opinion at the time, he decided that
the informal procedures could go into the general fund. Shortly
afterward, we had a lawsuit on that matter, and they construed that
term "administrative proceeding" a little bit more liberally than
the attorney general had. The result was that last session, the
legislature was faced with returning some substantial sums that had
come into the state's treasury under that informal process.
MR. BITNEY said we had a bill last year that attempted to define
some of the terms in subsection (b) of the constitutional reserve
in regards to what is available for appropriation, and how we
access the CBR under subsection (b) with a majority vote. The
legislature passed a vote trying to define those terms. Again we
were taken to court, and then now we have another decision from the
Alaska Supreme Court. Section (c) of the CBR states that the
legislature may appropriate from the constitutional budget reserve
with a three quarters vote for any public purpose. Subsection (d)
states that you have to pay it back.
MR. BITNEY said that what he was getting at is that Representative
Martin feels that we basically have a section of our Constitution
that is unworkable, and that what was given to the voters turned
out not to be entirely true, in practice. It is his hope,
realizing that this resolution would require a two thirds vote in
both the House and the Senate, as well as approval by the voters.
We realize this is an interim project, and will probably take a lot
of discussion with the public to present what has happened and what
we would like to do. It is his hope to work on it in the House
Finance Committee over the interim to discuss what steps need to be
taken to clear up the language within the constitutional budget
reserve, and perhaps look at taking a measure to the voters in next
fall's election.
JACK FARGNOLI, Senior Policy Analyst, Office of Management and
Budget, Office of the Governor, opposed HJR 40. Part of our
concern about the bill is that it would tend to pre-empt a Fiscal
Planning Commission which is going to be looking at long-range
reserve funds and policies, and this one in particular. That, of
course, would be mitigated by holding it over with the commission
trying to complete its charge. The second concern we have is that
a simple repeal would leave us, in the absence of any such
mechanism -- if you recall, the whole intent that is universally
accepted about what this fund was supposed to do is to, in some
sense, take money off the table to help avoid the shock of putting
it on the table in lumps as it came in. If we were to remove it,
we would have that situation again. That is the other part of our
concern about it.
REPRESENTATIVE FINKELSTEIN asked Mr. Fargnoli if in his opinion has
this resulted in money being taken off the table that is coming in
from settlements and making it harder to get at that money for use
in a current budget. Have those two goals that were explained to
the public been met?
MR. FARGNOLI answered that in general those goals have been met.
Selective litigation has created complication, but in general, it
has kept money off the table and has made it harder to get money
out of the fund and make it useful. To some degree that was the
purpose of it, and that has happened.
TAPE 95-51, SIDE B
Number 000
REPRESENTATIVE TOOHEY asked if basically our costs are over and
above last year, and we do not have the funds.
MR. FARGNOLI answered basically that is correct.
REPRESENTATIVE TOOHEY asked what would happen if we could not pay
this money back and the fund goes away.
MR. FARGNOLI answered that if this were repealed, there would need
to be language saying that prior obligations would become void, and
that money in the fund would lapse to the general fund. That would
be their proposal.
REPRESENTATIVE TOOHEY asked if Mr. Fargnoli had a crystal ball
telling him how much money would be coming into this account in the
next ten years, in terms of future settlement money.
MR. FARGNOLI had no idea.
REPRESENTATIVE FINKELSTEIN stated that prior to this previous
settlement, it was up to $4,000,000,000, and now it is around
$3,000,000,000.
MR. FARGNOLI said the reason he says he has absolutely no idea is
because that number has gone up and down more than one or two
billion a year, in the last couple of years, so it is not like we
do not know what settlements are out there, but it is difficult to
tell how much there will be from time to time. The Department of
Law also has confidentiality restraints.
CHAIRMAN PORTER asked Mr. Fargnoli if in order to get into this
constitutional budget reserve fund, without a three quarters vote,
with just a majority vote, would we have to spend the earnings
reserve, the permanent fund, and all of those other funds first.
MR. FARGNOLI said yes, that is what would be required.
NEIL SLOTNICK, Department of Law, stated he had been asked to come
to the hearing in case there were questions for him. He was also
asked to comment on whether they saw any legal problems with this
resolution. The Department of Law does not see any legal problems
with this resolution, and that it would do what it purports to do.
There are a couple of potential ambiguities that could be clarified
by transitional language. For example, the question of where does
the money that is now in the constitutional budget reserve go if
this repeal is adopted by the voters. He would argue that it would
lapse into the general fund; that could be stated specifically in
a transitional statement. A similar question is, what happens to
the repayment obligation that is specified in Section 17(d)? In
his view, that repayment obligation would be extinguished, and it
could be specified in a transitional statement.
CHAIRMAN PORTER closed the public hearing on HJR 40. He asked John
Bitney if the motion of more clear transitional language might be
something that the Finance Committee would want to look at.
MR. BITNEY answered that in introducing the bill, the sponsor had
preferred not to put that in at this time just for the sake of not
trying to get the discussion focused on that at this point. It is
his intent in introducing it, to try to focus in on the CBR
language and the amendment itself, and then, yes, to actually do
transitional language as we go through the process. The question
remains out there as to what to do with the general funds and the
permanent funds.
Number 400
REPRESENTATIVE TOOHEY moved to pass the resolution out of committee
with the zero fiscal note and individual recommendations.
REPRESENTATIVE FINKELSTEIN objected. A roll call vote was taken.
Representative Finkelstein voted no. Representatives Toohey, Green
and Porter voted yes. HJR 40 passed out of committee with a three
to one vote.
REPRESENTATIVE FINKELSTEIN moved to rescind the vote.
CHAIRMAN PORTER stated that when we have a full committee, we will
move to rescind the motion and take another vote.
CSHB 35 - SEXUAL MISCONDUCT BY MEDICAL PROFESSIONALS
Number 450
REPRESENTATIVE SEAN PARNELL, bill sponsor, introduced CSHB 35. He
stated that HB 35 is an act relating to sexual misconduct as
grounds for imposing disciplinary sanctions on persons licensed by
the State Medical Board. Sexual misconduct is not addressed
expressly in statute, but current law permits the Alaska State
Medical Board to impose sanctions for medical professionals engaged
in unprofessional conduct, or lewd or immoral conduct in connection
to the delivery of professional services. Most of us would
categorize sexual misconduct by a doctor as unprofessional, or lewd
or immoral. These broad categorizations do not send the message
that we, as a society, do not want physicians engaging in sexual
relations with patients who are under their care and control. The
Alaska State Medical Board shares this sentiment, and according to
their representative in a previous committee, doctors should be
held to the highest standard in this area. We all know the
physician/patient relationship is established on mutual trust.
Sexual misconduct, in his view, is a breach of that trust.
REPRESENTATIVE PARNELL mentioned that HB 35 would authorize the
Medical Board to sanction doctors who engage in sexual misconduct
and the bill briefly defines sexual misconduct on page 2. Granting
the Medical Board express authority to sanction doctors who engage
in sexual misconduct is critical for several reasons. The patient
is extremely vulnerable, the doctor can use their status as a
medical professional in over-reaching the bounds of professional
conduct. Most importantly, the doctor's objective medical judgment
is compromised if that doctor is engaged in sexual misconduct.
Both the Alaska State Medical Association and the Network on
Domestic Violence and Sexual Assault support HB 35.
Number 500
CATHERINE REARDON, Director, Division of Occupational Licensing,
Department of Commerce and Economic Development, shared the
department's neutral position on this bill. They feel it will
encourage the process that the Medical Board has been going through
in trying to develop regulations defining sexual misconduct and
unprofessional conduct. HB 35 will not greatly affect our
disciplinary costs. The issue of regulating sexual contact outside
of the work place is a policy call, and one that the legislature is
the appropriate group to make. Although we have seen activities
which involve sexual contact between physicians and patients
outside the work place, which we would all feel inappropriate,
however, the point that doctors also need to have opportunities to
pursue their romantic lives has also been brought up.
MS. REARDON pointed out that the Attorney General's Office
contacted her indicating there is a definition for sexual contact
in statute in Title 11. If the legislature does not want that
definition to be applied to this bill, perhaps it would be helpful
to clarify that definition. That appears in AS 11.81.900. It
defines sexual contact in a more limited way than is intended by
the legislature in this bill.
MS. REARDON gave an example of the types of complaints they
receive. A doctor sent a video tape of himself to one of his
patients in which the doctor was nude. That was a pursuit which
was going on outside of the work place, and yet, we would probably
feel that was inappropriate.
Number 550
JAYNE ANDREEN, Executive Director, Council on Domestic Violence and
Sexual Assault, spoke in strong support of HB 35. They have become
increasingly aware of cases where there is sexual misconduct on the
part of physicians, both inside and outside of the treatment
setting. This is a bill that they feel has to take place. There
has to be some sanctions. The American Medical Association has
this kind of standard, and the Medical Ethics Board is interested
in doing this also. This is the type of standard that is place for
psychiatrists and attorneys. We feel physicians need to be
included in that.
CHAIRMAN PORTER asked Representative Parnell if the definition of
sexual contact in AS 11.81.900 is what he had in mind for this
bill.
REPRESENTATIVE PARNELL said different states have done it different
ways. AS 11.81.900 gets pretty specific, but does not include
penetration. That is defined elsewhere. He did not want the
definition to be limited to AS 11.81.900. He felt the definition
in HB 35 should be more expansive than that. He felt the Medical
Board could address the specifics of the definition.
REPRESENTATIVE FINKELSTEIN expressed concern over the hundreds of
small towns we have in this state. Oftentimes doctors are in one-
doctor towns. And oftentimes, the doctors who will go to these
places are young and single. In a one-doctor town, everyone is
your patient. They may have not been in that week or that month,
but that is who they are going to go to, right? This would be for
immunizations and everything. He could not imagine how a single
doctor would go out and serve in a rural community, because they
could not get involved with anyone. Certainly that was not the
sponsor's intent.
REPRESENTATIVE PARNELL feared the potential for abuse in a one-
doctor town was even greater than in a city. That is an issue. He
felt that if a doctor was involved with a patient, they ought to
terminate the relationship and refer the patient to another doctor,
because of the vulnerability aspect. The care of the patient is
the highest priority, not the doctor's sexual necessities. He felt
they should include language that specifies "during the
physician/client relationship." That is the direction Rhode Island
has taken on the issue.
REPRESENTATIVE FINKELSTEIN felt that was also unreasonable for a
small town, since it is unclear when your physician/client
relationship ends.
REPRESENTATIVE TOOHEY said we are not going to state that doctors
in a one-doctor town remain celibate. There has got to be a way
that the State Medical Board can look at these case-by-case.
Otherwise, you are going to have to get very old, or asexual people
to work in small towns.
REPRESENTATIVE VEZEY felt this language about sexual contact
outside the treatment center is totally out of line and applicable
to a psychiatrist/patient relationship. The Medical Board is
having extreme difficulty addressing this, and the thought that we
could address it is ludicrous. If you want to write a statute that
addresses the bizarre example that was given previously, you could,
but people are people, they are sexual creatures. He felt it
absolutely inappropriate that we try to regulate romantic
relationships between adults.
REPRESENTATIVE PARNELL said that is where we disagree, based upon
his opening statement, and the vulnerabilities.
TAPE 95-52, SIDE A
Number 000
REPRESENTATIVE FINKELSTEIN offered amendment one which would
clarify that on page 2, lines 25 and 26, this sexual contact would
not be allowed "during the existence of the physician/client
relationship, as defined by the Board." This replaces the current
phrase, "during the course of treatment or outside the treatment
setting." Hearing no objection, amendment one was adopted.
REPRESENTATIVE FINKELSTEIN offered amendment two. This would
clarify the definition of "sexual misconduct." This would include
sexual contact or attempted sexual contact as defined by the Board,
and regulations adopted under this section.
ANNE CARPENETI, Committee Aide, House Judiciary Committee,
mentioned that to define sexual misconduct, this amendment would
have to be tinkered with, because she did not think this section
would give regulatory power. You would have to define it as
regulations adopted under this chapter in Title 8.
CHAIRMAN PORTER asked if Representative Finkelstein would be
willing to change "under this section" to "under this chapter."
REPRESENTATIVE FINKELSTEIN answered that he would be willing to
make this whole thing a conceptual amendment to avoid any of these
problems.
REPRESENTATIVE GREEN suggested having the bill drafter come up with
the right language, because it is not just sexual contact; it is
inappropriate sexual contact. It includes sexual contact, and
sexual contact may be perfectly alright and still not be sexual
misconduct; taking a vaginal examination, for example. This is
sexual contact by a licensed physician, but it is not misconduct.
REPRESENTATIVE PARNELL clarified that is why the language was
provided on line 23 that adds, "outside the scope of generally
accepted methods of examination or treatment." Presumably an
obstetrician/gynecologist exam is within that scope.
CHAIRMAN PORTER said he would feel better if they made it a
conceptual amendment. He felt they were trying to say that the
Board should define "sexual misconduct" and "sexual contact."
REPRESENTATIVE FINKELSTEIN asked if he could offer this as a
conceptual amendment that would require the Board to develop
regulations related to sexual contact, and its limits in the
physical realm. We have the rest of the definition of sexual
misconduct here. It is only the degree to which contact ranges,
that is what we are after here.
REPRESENTATIVE TOOHEY asked him to say that again.
REPRESENTATIVE FINKELSTEIN restated that they would somehow write
in a way that implies the physical side of the limits of sexual
contact. We are not talking here anymore about the term or the
existence of the client relationship or the spouse. That is all in
the later stuff. All we have left here is what is in the range of
things starting from what could be determined as sexual contact.
They need to have a definition of the physical range. This would
just be a conceptual amendment.
REPRESENTATIVE PARNELL said that was fine.
CHAIRMAN PORTER clarified that amendment two is a conceptual
amendment that will allow the Board to write regulations that
extend the definition of sexual contact, as it is within sexual
misconduct that they are now attempting to define in any event.
REPRESENTATIVE VEZEY felt the area we are trying to address is
actually much better covered in the tort liability these health
care professionals have. He did not think the committee could
succeed in codifying what our goal is here.
CHAIRMAN PORTER asked if there was further discussion on the bill,
or objection. Hearing no objection, amendment two was passed.
REPRESENTATIVE FINKELSTEIN moved to pass the bill out of committee,
as amended, with individual recommendations and zero fiscal notes.
CHAIRMAN PORTER said we would draft a CS with these amendments
incorporated, then meet with the sponsor and anyone else who wants
to be in the loop.
REPRESENTATIVE TOOHEY said she would like to be in the loop.
CHAIRMAN PORTER said if anyone has objections to what they have
crafted, then they can let him know, but the bill will be held
until that is accomplished. He asked if there was objection to
moving the bill under the conditions stated. Hearing no objection,
under the conditions stated, CSHB 35(JUD) passed out of committee.
HJR 40 - REPEAL BUDGET RESERVE FUND (ART IX SEC 17) (CONTINUED)
CHAIRMAN PORTER announced they had a motion to rescind their action
on failing to adopt HJR 40. Hearing no objection, that motion
passed.
REPRESENTATIVE GREEN moved to pass HJR 40 out of committee with
individual recommendations and attached fiscal notes.
REPRESENTATIVE FINKELSTEIN objected and a roll call vote was taken.
Representatives Vezey, Toohey, Green and Porter voted yes.
Representative Finkelstein voted no. HJR 40 moved with a four to
one vote.
ADJOURNMENT
The House Judiciary Committee adjourned at 5:00 p.m.
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