04/15/2002 01:28 PM House JUD
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+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE JUDICIARY STANDING COMMITTEE
April 15, 2002
1:28 p.m.
MEMBERS PRESENT
Representative Norman Rokeberg, Chair
Representative Jeannette James
Representative John Coghill
Representative Kevin Meyer
Representative Ethan Berkowitz
Representative Albert Kookesh
MEMBERS ABSENT
Representative Scott Ogan, Vice Chair
COMMITTEE CALENDAR
HOUSE BILL NO. 319
"An Act relating to civil liability for commercial recreational
activities; and providing for an effective date."
- MOVED CSHB 319(JUD) OUT OF COMMITTEE
HOUSE BILL NO. 124
"An Act prohibiting nursing facilities and assisted living homes
from employing or allowing access by persons with certain
criminal backgrounds, with exceptions."
- HEARD AND HELD
PREVIOUS ACTION
BILL: HB 319
SHORT TITLE:RECREATIONAL ACTIVITY LIABILITY
SPONSOR(S): REPRESENTATIVE(S)KOTT
Jrn-Date Jrn-Page Action
01/14/02 1958 (H) READ THE FIRST TIME -
REFERRALS
01/14/02 1958 (H) L&C, JUD
02/11/02 2210 (H) COSPONSOR(S): DYSON
03/13/02 (H) L&C AT 3:45 PM CAPITOL 17
03/13/02 (H) Moved CSHB 319(L&C) Out of
Committee
03/13/02 (H) MINUTE(L&C)
03/15/02 2542 (H) L&C RPT CS(L&C) NT 1DP 6NR
03/15/02 2542 (H) DP: KOTT; NR: ROKEBERG,
MEYER, HAYES,
03/15/02 2542 (H) CRAWFORD, HALCRO, MURKOWSKI
03/15/02 2542 (H) FN1: ZERO(CRT)
03/27/02 (H) JUD AT 1:00 PM CAPITOL 120
03/27/02 (H) -- Meeting Canceled --
04/10/02 (H) JUD AT 1:00 PM CAPITOL 120
04/10/02 (H) Scheduled But Not Heard
04/15/02 (H) JUD AT 1:00 PM CAPITOL 120
BILL: HB 124
SHORT TITLE:NURS.HOME/ASSISTED LIV. EMPLOYEES/VISITOR
SPONSOR(S): REPRESENTATIVE(S)HALCRO
Jrn-Date Jrn-Page Action
02/09/01 0282 (H) READ THE FIRST TIME -
REFERRALS
02/09/01 0282 (H) HES, JUD
03/07/01 0501 (H) COSPONSOR(S): DYSON
03/15/01 (H) HES AT 3:00 PM CAPITOL 106
03/15/01 (H) Heard & Held
03/15/01 (H) MINUTE(HES)
03/19/01 0656 (H) COSPONSOR(S): STEVENS
03/20/01 (H) HES AT 3:00 PM CAPITOL 106
03/20/01 (H) <Bill Canceled>
03/22/01 (H) HES AT 3:00 PM CAPITOL 106
03/22/01 (H) Heard & Held
03/22/01 (H) MINUTE(HES)
04/17/01 (H) HES AT 3:00 PM CAPITOL 106
04/17/01 (H) Moved CSHB 124(HES) Out of
Committee
04/17/01 (H) MINUTE(HES)
04/19/01 1061 (H) HES RPT CS(HES) NT 4DP 3NR
04/19/01 1062 (H) DP: CISSNA, WILSON, STEVENS,
KOHRING;
04/19/01 1062 (H) NR: JOULE, COGHILL, DYSON
04/19/01 1062 (H) FN1: (HSS)
04/19/01 1062 (H) REFERRED TO JUDICIARY
04/19/01 1062 (H) FIN REFERRAL ADDED AFTER JUD
03/25/02 (H) JUD AT 1:00 PM CAPITOL 120
03/25/02 (H) <Bill Postponed>
04/15/02 (H) JUD AT 1:00 PM CAPITOL 120
WITNESS REGISTER
LINDA SYLVESTER, Staff
to Representative Pete Kott
Alaska State Legislature
Capitol Building, Room 204
Juneau, Alaska 99801
POSITION STATEMENT: Presented HB 319 on behalf of the sponsor,
Representative Kott.
MIKE WINDRED, President
Juneau Chapter
Alaska Travel Industry Association (ATIA)
9085 Glacier Highway, Number 301
Juneau, Alaska 99801
POSITION STATEMENT: Testified in support of HB 319 and
responded to questions.
AL CLOUGH
PO Box 241003
Douglas, Alaska 99824
POSITION STATEMENT: Testified in support of HB 319 and
responded to questions.
KIP KNUDSON, Era Aviation, Inc.
6160 Carl Brady Drive
Anchorage, Alaska 99502
POSITION STATEMENT: Testified in support of CSHB 319(L&C).
ROBERT WAGSTAFF, Attorney
425 G Street
Anchorage, Alaska 99501
POSITION STATEMENT: Testified in opposition to HB 319 and
responded to questions.
BRUCE BARKER, Vice President
General Manager
Mount Roberts Tramway
15902 Glacier Highway
Juneau, Alaska 99801
POSITION STATEMENT: Testified in support of HB 319 and
responded to questions.
CHRISTOPHER KNIGHT, Staff
to Representative Andrew Halcro
Alaska State Legislature
Capitol Building, Room 414
Juneau, Alaska 99801
POSITION STATEMENT: Presented HB 124 on behalf of the sponsor,
Representative Halcro.
ALISON ELGEE, Deputy Commissioner
Office of the Commissioner
Department of Administration (DOA)
PO Box 110200
Juneau, Alaska 99811-0200
POSITION STATEMENT: During discussion of HB 124 provided
comments on behalf of both the DOA and the Department of Health
& Social Services (DHSS).
LISA CARESS-BEU, President
Center for Advocacy and Rights of the Elderly (CARING)
2420 Chinook Avenue
Anchorage, Alaska 99516
POSITION STATEMENT: Testified in support of HB 124.
AILEEN HERRING, Vice President
Center for Advocacy and Rights of the Elderly (CARING)
8821 Emerald Drive
Anchorage, Alaska 99502
POSITION STATEMENT: Testified in support of HB 124.
ACTION NARRATIVE
TAPE 02-48, SIDE A
Number 0001
CHAIR NORMAN ROKEBERG called the House Judiciary Standing
Committee meeting to order at 1:28 p.m. Representatives
Rokeberg, James, Coghill, and Meyer were present at the call to
order. Representatives Berkowitz and Kookesh arrived as the
meeting was in progress.
HB 319 - RECREATIONAL ACTIVITY LIABILITY
Number 0050
CHAIR ROKEBERG announced that the first order of business would
be HOUSE BILL NO. 319, "An Act relating to civil liability for
commercial recreational activities; and providing for an
effective date." [Before the committee was CSHB 319(L&C).]
Number 0071
LINDA SYLVESTER, Staff to Representative Pete Kott, Alaska State
Legislature, sponsor of HB 319, said, on behalf of
Representative Kott, that over the past 20 years, many
recreation-oriented states have enacted statutes defining the
"inherent risk doctrine" pertaining to commercial recreational
activities. Theoretically, the common law has held that a
recreation provider has no duty to protect the participants from
the inherent risks of the recreational activity, and no
corresponding liability to participants for injury or loss
resulting from those inherent risks. However, in the real
world, she remarked, recreational providers can and very often
have been held responsible if a court or a jury finds that the
inherent risk has caused the participant's injuries.
Unfortunately, the line between the inherent risk and negligence
is often blurred.
MS. SYLVESTER offered that "negligence" is [construed as] a
provider's failure to fulfill a duty owed to the participant,
the duty generally being to exercise reasonable care under the
circumstances. The inevitability of a certain level of danger
in a sport is recognized in law by the means of the concept of
inherent risk. She suggested that most providers will state
that although they've rarely been taken to court, they must
frequently fend off threats of lawsuits. Many of these types of
claims will not stand up in court, but fighting them is costly
for businesses in terms of legal expenses, insurance premiums,
and settlement costs. Because of the court's inconsistent
decisions over these principles, many states have taken an
alternative path and enacted statutes [regarding] "recreation
law."
MS. SYLVESTER explained that some states have enacted statutes
that cover one [or two activities]; for example, Colorado has a
"ski and equine Act." These statutes attempt to define the
types of inherent risks specific to the activity. She noted
that Representative Coghill has sponsored a bill regarding
[civil liability as it pertains to livestock activity].
CHAIR ROKEBERG added that there is already a statute pertaining
to skiing.
Number 0290
MS. SYLVESTER confirmed this, adding that it is a very detailed
[statute]. She went on to explain that Nevada has a statute
that covers amusement and recreational activities: "before one
boards a roller coaster at [the] New York, New York [Hotel &
Casino], signage - ample signage - instructs the participant
that by boarding the ride, they specifically understands the
inherent risks." Thus, if a claim for damages is made, the
operator would not be liable for damages that resulted from the
inherent risks of that activity. In another example that occurs
in the state of Nevada, where they have parachuting activities,
prior to initiating the activity, the participant is briefed,
he/she signs a contract specifically indicating an understanding
of the specific risks involved in skydiving, and the person is
actually videotaped during that interview.
MS. SYLVESTER said that Wyoming and Vermont have enacted broad
"recreation safety Acts" that cover all recreational activities.
These states' statutes, she noted, generally define "inherent
risks" but do not include an exhaustive list of the risks or a
list of the provider's duties. She referred to the Alaska Ski
Safety Act, in which a skier's participation indicates that
he/she has accepted the inherent risks of skiing, and thus the
ski area operator is shielded from liability if an injury
results from the inherent risks of that activity. Similar to
the Alaska Ski Safety Act, HB 319 identifies the
responsibilities of both the participant and the operator.
Another area for which Alaska has developed similar statutes,
she noted, pertains to private landowners on unimproved land.
MS. SYLVESTER stated:
Noting that participation in outdoor recreation
carries with it many inherent risks, HB 319 seeks to
decrease the uncertainties regarding the legal
responsibilities for injury or loss. House Bill 319
establishes the responsibility of commercial
recreation businesses, and the responsibilities of
persons who elect to participate in these activities.
It addresses guidelines that the operators and
participants must follow to minimize the possibility
of accidents. Commercial businesses are still
responsible for meeting the safety standards and
providing trained and competent personnel, as outlined
in [proposed Sec. 05.50.040]. As well, any recreation
provider, of course, would be liable for negligence.
This is just dealing with ... damages that are
associated with the inherent risks of the activity.
Number 0495
However, HB 319 will add the presumption that a
participant accepts the inherent risk of a commercial
recreation activity and ... has played a part in any
losses resulting from the inherent risk. The
legislation will decrease uncertainties regarding the
legal responsibilities for injuries, and encourage the
continued viability of responsible businesses that
offer commercial recreational activities to the
public. This bill will avoid unfair and unreasonable
claims that make it difficult to provide these types
of activities, which are synonymous with the Alaskan
lifestyle and visitor expectations. Likewise, a non-
paying guest who is transported by a noncommercial
aircraft or watercraft is considered to have assumed
the same inherent risks [as] the commercial recreation
user.
MS. SYLVESTER added:
The addition of Section 3 amends Title 9 - Actions,
Immunities, Defenses, and Duties - by adding a section
that shields owners or operators of watercraft and
aircraft under certain circumstances related to their
guests. Again, the intent is to provide clarity, to
set out the responsibilities of the aircraft and
watercraft owners. It would prevent the family of a
pilot from [incurring] losses due to anything other
than negligence.
REPRESENTATIVE BERKOWITZ posed the question: "So, I'm flying on
... frequent flyer miles - what is that?"
MS. SYLVESTER replied:
It would be [as] a guest passenger. ... If you were
flying with your friend, flying out fishing, and you
were ... his guest, barring negligence, if the plane
crashed or you were injured, and it was due to the
inherent risk, and you were notified by the owner that
he wasn't insured, ... he would be shielded.
REPRESENTATIVE BERKOWITZ said: "I don't see where the
restriction would be only to ... noncommercial."
MS. SYLVESTER indicated that that restriction could be found in
Section 3, page 3, line 24.
Number 0619
REPRESENTATIVE BERKOWITZ posed the scenario in which he is
flying on Alaska Airlines using airline miles.
MS. SYLVESTER said:
It's still -- what the term would be is -- there's no
compensation for the transportation, and we're
proposing to add the additional definition from the
[Federal Aviation Administration (FAA)] that states,
"Not for hire." And a commercial common carrier would
never be considered to be not for hire or no
compensation being exchanged.
REPRESENTATIVE BERKOWITZ said: "That's currently not -- ... my
concern is correct, in other words."
CHAIR ROKEBERG said: No.
MS. SYLVESTER added: "No, I don't think so."
CHAIR ROKEBERG noted that the sponsor of HB 319 has requested
that the committee adopt a clarifying amendment: after the word
"transportation" - on page 3, line 25 - add "or hire". Such
would further clarify the language regarding not being
compensated for transportation, he suggested.
REPRESENTATIVE BERKOWITZ surmised: "So the language as it's
currently written doesn't factor in my concern."
CHAIR ROKEBERG said: "Not being -- you're being compensated if
you're on Alaska Airlines; or ... the tort feasor would be ...
compensated."
MS. SYLVESTER, in an attempt to clarify, offered the following:
Our concern ... was when pilots go out and ... share
expenses. The concern came from a private pilot that
that might be construed under federal FAA regulations
to be "for hire." So, the definition for a private
pilot is, "A private pilot ... may not, for
compensation or for hire, act as a pilot in command of
an aircraft.
CHAIR ROKEBERG said, "When you're paying for the gas, was the
issue here; not if you're on Alaska Airlines."
Number 0769
MS. SYLVESTER indicated agreement and said that adding "not for
compensation or for hire" would address the concern that the FAA
might consider sharing expenses as compensating the pilot.
REPRESENTATIVE BERKOWITZ asked to see the amendment.
CHAIR ROKEBERG suggested that Ms. Sylvester finish her
presentation first.
MS. SYLVESTER continued:
What I would like to say in conclusion is that the
industry that we have is in need because of the
current landscape with the litigious society that we
live in. And I would propose that what we're
attempting to do here is a legitimate effort of our
state, because we've got an environment where ... the
aircraft and watercraft passengers have been impacted
tremendously in the lack of availability of insurance.
And likewise, with the recreational providers, the
same type of a situation has developed.
MS. SYLVESTER, referring to Representative Coghill's legislation
regarding [civil liability as it pertains to livestock
activity], read from the 2/6/02 Senate Judiciary Committee
minutes, in which Senator Taylor was summarized as saying:
One problem was perception, accurate or not, of
specious law suits being brought. Another being the
insurance industry uses these specious bits of
litigation to overcharge for a liability policy.
MS. SYLVESTER concluded that that is exactly the situation now,
wherein private pilots cannot afford insurance. She said that
insurance is available from airport to airport, but it is not
available "if you go off airport." It's escalating, she added,
to the point that there are fears that, very shortly, small
airplane carriers will not be able to purchase liability
insurance at all. She mentioned that other pending legislation
is attempting to address those [fears].
Number 0907
REPRESENTATIVE BERKOWITZ said, "I hear you say that the
insurance is, essentially, prohibitively expensive, but this is
yet another tort reform bill, and I'm wondering where the
companion legislation is that would actually control the
insurance costs."
MS. SYLVESTER replied: "One of the stated mechanisms of
controlling insurance costs is by limiting the payouts."
REPRESENTATIVE BERKOWITZ asked, "Stated by whom?"
MS. SYLVESTER replied, "By the Division of Insurance, actually."
CHAIR ROKEBERG noted that the week prior, the committee heard an
update from the Division of Insurance "on this issue."
REPRESENTATIVE BERKOWITZ relayed that according to his
understanding, one of the reasons that the costs to the carriers
is going up is that there were fewer insurance companies.
CHAIR ROKEBERG agreed, adding that there are fewer air carriers
as well, "due in part to the increased cost of insuring their
seat miles."
REPRESENTATIVE BERKOWITZ noted, "There is other legislation that
directly addresses that issue."
CHAIR ROKEBERG agreed, but pointed out that "this is for non-
hires; the other legislation is for aircraft carriers that are
for hire."
REPRESENTATIVE JAMES opined that the issue is whether there is
any insurance available. She posited that "we need to define
just exactly what the responsibility is of these people,"
including the responsibility to investigate whether a specific
activity has any inherent risks before engaging in that
activity. She remarked that the act of flying in an airplane
has more inherent risk than not flying in an airplane.
REPRESENTATIVE BERKOWITZ asked to be shown some empirical
evidence of "these assertions," adding, "I'm curious to know how
many cases we're talking about; what ... are the dimensions of
the problem we're trying to fix."
MS. SYLVESTER indicated that she could obtain that information.
CHAIR ROKEBERG mentioned that testimony in the House Labor and
Commerce Standing Committee indicated to him that there is
frequent litigation that almost verges on vexatious, and without
appropriate legislation, the state won't have any control over
the situation. He opined that the sponsor of HB 319 "wants to
alert the judiciary that we, as a matter of public policy, want
to take the inherent risk of an activity into greater account
when apportioning any awards that would be forthcoming."
MS. SYLVESTER indicated that that is a fair interpretation of
the sponsor's intent.
Number 1158
MIKE WINDRED, President, Juneau Chapter, Alaska Travel Industry
Association (ATIA), mentioned that he has worked for Alaska
Travel Adventures, Inc., for approximately 19 years. He said:
I'd just like to fill you in and answer some questions
with [regard] to what I think [HB 319] will do for our
industry and for our company specifically. I'd just
like to start off by saying that this bill really
shouldn't be necessary, but it is. We live in a
pretty litigious society, obviously, and the ability
to take someone to court over almost anything is a
sacred act. But it's also a very expensive act. And
that's kind of where we'll get into the heart of this
... with [regard] to why you don't see ... a lot of
trials over smaller claims; [it] is because you can't
seriously go to trial and not spend about [$20,000 to
$30,000] if you're going to defend yourself
vigorously.
So that's why you don't see as much litigation as you
would, because it's pretty easy to settle those things
for a lot less. And our society has learned - started
to learn - what those dollar amounts are, to keep it
from going to trial. It's become so expensive, it is
getting very difficult for recreation providers to be
able to actually get insurance, or - how much are they
putting out of their pocket besides the insurance
costs. As an example, Alaska Travel Adventures'
insurance has gone up about 20 percent in the last
year, and it's primarily due to the number of claims
that go in. And even if we settle them ourselves,
which usually is what happens, we still obviously have
to notify the insurance company anytime there's a
claim that happens.
Number 1275
MR. WINDRED, in response to a question, explained:
Alaska Travel Adventures has thirteen daytrips in
Southeast Alaska: four of them in Ketchikan, four in
Juneau, one in Sitka, ... [and] two in Skagway. And
we do everything from whitewater river rafting to
mountain-lake canoeing, jeep trips, salmon bakes - ...
pretty classic soft adventures. We also have RV
[recreational vehicle] parks up north and motor home
trips throughout the state, and we'll service probably
about 150,000 clients over the course of the five
months of the summer. So [Alaska Travel Adventures
is] one of the larger day-tour operators in the state.
CHAIR ROKEBERG inquired: "And you've indicated that your claims
have gone up, and that's one reason you suspect you've had [an]
increase in premium write-ups?"
MR. WINDRED said that there are a lot of other reasons, besides
claims, why insurance rates go up, particularly for air
carriers; the terrorist attacks of September 11, 2001 ("9/11")
obviously had a fairly large impact on the air carrier industry,
though it did not have as much of an impact with regard to the
travel industry's insurance rates. He noted that most people in
the travel industry had a pretty good idea of what was happening
with insurance rates before the 9/11 attacks happened; just the
frequency of fighting off small claims affects "your 'mod rate'
with an insurance [company], and that goes up." He mentioned
that some of these small claims are the result of someone
tripping over a rock, or of someone, "just out of sheer
klutziness," trying to get their vacation paid for. He added
that such cases have to be defended fairly vigorously.
CHAIR ROKEBERG asked how many lawsuits have been filed against
Alaska Travel Adventures over the last several years.
MR. WINDRED said probably two or three within the last five
years. He indicated that most claims don't get that far because
of the expense [of going to trial]. He said: "There's kind of
a magic number of about $10,000 per person that everybody knows,
and I think where this bill would help us is in the ability to
state some statutes and keep it from getting to that point." He
added that it would be helpful to be able to have his company's
attorney simply write the claimant's attorney, cite the specific
statute, and either get the claim dropped or limit it to
something reasonable such as medical expenses.
MR. WINDRED, in conclusion, indicated that his industry is
concerned about fairness. He offered that it is in an
operator's best interest to maintain equipment, train employees
well, inform the participants of the inherent risks - either
through written statements or through videos or some other
method that can be substantiated - and keep accurate records.
He remarked that most of the claims his company sees have to do
with somebody tripping over something, somebody dropping a
camera in the water, or similar incidents. He suggested that in
circumstances where something occurs as a result of an inherent
risk, in making the decision to participate, a large portion of
the responsibility for any ensuing outcome rests with the
individual participant.
Number 1479
MR. WINDRED provided the following example:
Several years ago, we had somebody go on our river-
rafting trip here in Juneau.... We give everybody a
very good safety briefing in the bus, have them sign
an acknowledgement form of the risks that are involved
and that they're in generally good health, and when
they get on the raft we go through the whole safety
thing again and [explain], "Hey, the water ... starts
off at 33 degrees and gets to a good balmy 35 or 36
[degrees] by the end of the river." But we had one
gentleman who wasn't hanging on to the raft as was
instructed; [he] fell off the raft during the rapids.
We pull him out of the water a while later, and ...
immediately had an ambulance there, took him to the
hospital just to be checked out for hypothermia. And
at that point we find out he'd just gone through a
triple bypass about two weeks earlier. So, we had
never been informed of that ... and he'd decided to go
ahead and take that risk on his own.
MR. WINDRED posited that had something even more major happened
to that individual, the family would have come after the company
just for taking him on the trip. He said that this is a perfect
example of where this legislation could really help. "At some
point people have to be responsible for their own decisions when
choosing to participate in an activity," he added.
REPRESENTATIVE BERKOWITZ, noting that Mr. Windred had indicated
that claims had gone up and insurance rates had gone up, asked,
"Can you tell me how much?"
MR. WINDRED said: "About 20 to 25 percent."
REPRESENTATIVE BERKOWITZ asked whether that was the percentage
for both the increase in claims and the increase in insurance
rates.
MR. WINDRED attempted to clarify that the number of claims
hasn't really gone up; but, he opined, the insurance rates have
gone up because of the number of claims.
CHAIR ROKEBERG asked whether that was "year over year."
MR. WINDRED replied: "Fairly consistently; some of it has to do
with negotiating with insurance companies, but over the last
couple of years it's been 20 percent.
Number 1569
REPRESENTATIVE BERKOWITZ surmised, then, that Mr. Windred is
indicating that the number of claims has roughly held steady,
but the insurance costs have risen.
MR. WINDRED agreed, adding:
Over the last, I'd say, five years it has. Previous
to that it's gone up pretty tremendously, I think
because people - the traveling public - is getting
more educated about going after an operator to pay for
the cost of their vacation or ... they want to make a
little money off of something that happened that maybe
wasn't even an operator's fault.
REPRESENTATIVE BERKOWITZ said:
I'm sympathetic to the problems of small businesses
with frivolous suits, having endured some. But I'm
having a hard time seeing the correlation here, when
the ... number of claims have been essentially flat
and the insurance rates have gone up 20 to 25 percent,
... what the linkage is between claims and the rates.
Have the amount of the claims gone up?
MR. WINDRED replied that to some degree, the amount of the
claims has gone up, and suggested that the types of claims also
[influence rates]. He elaborated:
Previously a lot of the claims that we fought were not
things that we needed to turn in to the insurance
company, as they were for damaged equipment, et
cetera. And now people ... - the traveling public -
have become so well educated that the story has seemed
to [grow] in terms of what's happened in the accident.
So ... it becomes very important for us, if it looks
like there's a potential that this might go to trial
or that it's a serious claim, that that gets reported
to the insurance company.
REPRESENTATIVE BERKOWITZ asked whether the demographic of the
client base has changed.
MR. WINDRED indicated that the average age of clients has
actually gone down slightly over the years.
Number 1652
REPRESENTATIVE BERKOWITZ surmised, then, that Mr. Windred is
indicating: "The trends are, you've got healthier people, same
number of claims, slightly higher cost of claims, but greatly
increased cost of insurance.
CHAIR ROKEBERG mentioned that [this increase] may or may not be
attributable to the high level of awards.
REPRESENTATIVE JAMES asked Mr. Windred: "When you're counting
these claims ..., you're just counting your own?" Or do the
numbers reflect other companies? Are they statewide numbers or
nationwide numbers?
MR. WINDRED said, "That's just within our company."
REPRESENTATIVE JAMES opined that because insurance companies
have a broad base for what establishes their costs, unless all
the factors are known, "I don't think it's measurable."
MR. WINDRED offered that there were two things to keep in mind
about insurance: First of all, there is the general rate that
is set by the state, but then there is also an "experience mod"
for each company. For example, one rafting company can haul the
exact same number of clients as another rafting company in the
same area, and they won't have the same insurance rate because
each company's "experience mod" is different.
CHAIR ROKEBERG said he assumes that the insurance rates for that
type of business are going to be extraordinarily high because it
is a risky business. He suggested that in future litigation,
legislation such as HB 319 would ensure that responsibility - in
the form of monetary judgment - is apportioned more fairly.
MR. WINDRED agreed. Using the aforementioned incident as an
example, he said one of the issues that might have had to be
settled in court was whether the company was at fault for the
man falling into the water; if HB 319 passes and should a
similar case go to trial, the court might find that the
participant, through his/her own negligence, contributed to the
incident and became subject to the inherent risks of the
activity because he/she did not follow instructions. He offered
that HB 319 would set up standards that companies in this
industry would have to measure up to. For example: "If, as a
company, ... we didn't maintain our equipment or we couldn't
prove that we maintained our equipment or we couldn't prove that
we had told ... [clients] about an inherent risk, then this
legislation says that we ... [can be held] civilly liable.
Number 1782
REPRESENTATIVE BERKOWITZ asked: But in that instance, ... the
gentleman who fell overboard didn't sue, did he?
MR. WINDRED said he had not.
REPRESENTATIVE BERKOWITZ said: "[So] we're sort of going on
this hypothetical supposition that his estate would have sued
had he died...."
MR. WINDRED agreed. He mentioned that there have been other
incidents very similar to the example given. Elaborating about
one such incident, he said: "A tree falling on somebody in a
raft, for instance, act of God, went to court, spent years in
court, (indisc.) absolutely nothing that the company could
do;... it was several hundred thousand dollars in [attorney]
fees over this."
REPRESENTATIVE BERKOWITZ surmised that the insurance company
paid those fees.
MR. WINDRED acknowledged that was true, adding that of course
the insurance rates went up, everything but the deductible. He
said that his company spends about $30,000 a year - basically
buying people off because they have made some poor choices - in
order to keep things from going to court.
REPRESENTATIVE BERKOWITZ remarked: "Thirty thousand dollars for
150,000 people."
CHAIR ROKEBERG remarked: "That's just nuisance settlements
though; that doesn't include their other stuff."
REPRESENTATIVE BERKOWITZ commented: "Those would not be the
'vexatious cases,' then, would they?"
CHAIR ROKEBERG said: "Yes, they would."
REPRESENTATIVE BERKOWITZ replied: "Not if they're not
nuisance."
Number 1878
AL CLOUGH, after mentioning that he is a private aircraft owner
and operator, said that it is not uncommon to fly family,
friends, associates, or friends of friends from one destination
to another or out on hunting, fishing, sightseeing, or various
other types of recreational trips. These are noncommercial,
uncompensated, not-for-hire activities, and, he explained, the
FAA does not allow fees to be charged for these types of
flights. In addition, the FAA regulations specify what kind of
expenses can be shared by the pilot and the passengers, and it
is a very limited list. He said that according to his
understanding of HB 319, it provides some level of relief for
the aircraft operator and the small vessel operator should there
be some sort of incident. He added that commonly, the types of
flights that he would be taking people on would be to remote
airstrips, gravel bars, beaches, lakes, rivers, or saltwater;
these are unimproved landing sites with a whole host of
potential hazards, not to mention that there are potential
problems with the weather en route.
MR. CLOUGH said that as an aircraft owner and operator, he
certainly wouldn't have any [compunction] against placarding his
aircraft with notice that it is uninsured. He added, "The
majority of my flying friends and associates operate uninsured
aircraft for private enterprises." He mentioned that a friend
of his recently rebuilt an aircraft and the net value of it is
now in excess of $100,000; when his friend inquired about
insurance, he learned that it would cost over $10,000 a year and
would include severe restrictions regarding where the insurance
would remain in effect. Mr. Clough relayed that his friend has
chosen to simply try to fly carefully for the next ten years
rather than getting that insurance.
CHAIR ROKEBERG asked if that was just for liability insurance.
MR. CLOUGH, after nodding his head in the affirmative, went on
to say: "There is some insurance available that is very
restricted, though I've [spoken] to some people I know ..., and
they said they had just received questionnaires that were much
more detailed than ever before, and this is backlash over 9/11."
He said that of the 20 to 25 friends and associates whom he
knows that do fly for private enterprise, only one person has
insurance. He remarked that his insurance comes in the form of
"an extra piece of rope on the aircraft."
Number 2005
MR. CLOUGH, with regard to the aviation portion of HB 319,
relayed the following analogy:
I'm an owner of a hangar here at Juneau. It was a
four-unit hangar complex, [but] we recently added four
units on to them, [and] the net value of this whole
project's approaching $1 million now.... The
insurance prior to 9/11 for an aircraft hanger - not
contents insurance - was about $300 a year per hangar
bay; this is private noncommercial. Immediately after
9/11, we were informed by the insurance underwriter
that they were not going to reissue the policy for the
ensuing year. And we finally found somebody that
would insure and it went up 25 percent for a brand new
building with no contents insurance. But this is the
type of thing - I'm sure you've heard elsewhere in
aviation - that [is] the backlash over 9/11.
In all honesty I can't say ... how this bill would
directly lead to ... insurance ... that would be
affordable for private aviators, or give some level of
comfort to our estates ..., but it seems to me [to be]
a good start in the right direction. Right now it's
pointless to try to get insurance that's going to do
what you want to do as a small aircraft owner. And
[so I] just tell people ... what my experience is and
what the age of the aircraft is and what we're doing.
If they choose not to get in, that's their own choice.
[I personally have] not refused to get in people's
aircraft, but I have opted out of getting in people's
vessels in years past because of my personal
experiences; I wasn't comfortable with ... what was in
front of me.... I can't assure you that this would
make insurance affordable to aircraft [owners] - I'm
not in the insurance business - but it seems that it
would offer some relief and perhaps lead in that
direction, and I personally support it.
Number 2086
REPRESENTATIVE BERKOWITZ asked Mr. Clough if he's had a chance
to look at, and compare with HB 319, other pending legislation
regarding air carriers.
MR. CLOUGH said he had not yet done so. He added, "I know there
is a lot of effort [on] that end, and I am more than somewhat
familiar with the battles that the air carriers are facing now,
especially the '135 operators,' and it's scary and it looks like
it's going to get worse."
CHAIR ROKEBERG referred to Section 3 of HB 319. He noted it
describes "compensation" as: "a substantial payment in money,
services, or materials, but does not include a token payment."
He asked Mr. Clough to describe what expenses are customarily
shared between pilot and passengers.
MR. CLOUGH said that the FAA allows gas expenses and other of
the aircraft's direct operating expenses to be shared on a pro
rata basis.
REPRESENTATIVE BERKOWITZ noted that sometimes a pilot will fly
friends into a remote area to go hunting or fishing, and is then
given some of the catch in trade." He asked whether such a
practice would constitute "a substantial payment in ...
materials".
MR. CLOUGH said he could not speak to that particular issue,
reiterating that the customary practice is to essentially share
fuel. He said that when he is operating as a private pilot
operating a private aircraft, if he were to ask passengers to
pay for all of the direct costs of the airplane's operation, he
would be in violation of FAA regulations; the FAA would view it
as "operating for hire."
CHAIR ROKEBERG mentioned that he was "not sure that ...
[Alaska's] fish and game laws allow bartering and trading for
urban residents."
Number 2238
KIP KNUDSON; Era Aviation, Inc. ("Era"); testified via
teleconference in favor of CSHB 319(L&C). He said:
We feel the bill will, over the long term, have a
direct impact on our insurance rates. Just so you
know, the part of our operation that is relevant to
this legislation is our helicopter flightseeing tours,
where passengers board an aircraft in an urban area
and fly up to a remote area and usually get out of the
helicopter and have some sort of recreational
activity. That might be as simple as walking around
on a streambed or as complicated as getting off on a
glacier and getting on a dogsled. Currently, Era
Aviation briefs passengers, prior to their getting on
the aircraft, about the inherent dangers of that
recreational activity that they're about to engage in.
As far as I can tell, this legislation does not
address the liability issues associated with getting
to and from the recreational activity; that's dealt
with in other statutes and other pieces of legislation
that the committee currently has before it. I am
probably specifically kept out of the loop on the
number of claims and nuisance suits brought against
Era, but based on the questioning brought [up] today,
I'd be happy to spend time with any members talking
about that number with our corporate counsel. But the
... typical one that you may hear over and over is: a
passenger gets on a helicopter in Juneau, they fly up
to a glacier, they get off the helicopter, they're
walking around on the glacier, they slip and fall, and
then either [there is] a charge that a claim will be
brought or a claim is brought. And that's were this
specific piece of legislation will of great
assistance.
Number 2322
MR. KNUDSON continued:
Now, it hasn't been discussed, but a carrier or an
operator does not have to give the briefing that is
outlined in this piece of legislation. And then, if
they do not, they don't (indisc.) the initial
protection. Era is very excited about giving a more
detailed briefing, and we'll be doing that regardless
of whether the legislation passes or not. But of
course, if this piece of legislation passes, then our
protection on some of these claims will be greater.
One thing that Era does have slight heartburn with ...
is the language that's contained on page 3 of the
bill. Starting on line 2 there's the discussion of
first aid and cardiopulmonary resuscitation [CPR]
training. We think that application may be a little
broad. (Indisc.) a summer operation, we'd talked
about employees responsible for assisting
participants; that could be the customer service agent
that actually takes the money, [it] could be the line
service agents that are on the ramp getting the
helicopter into the air, it could [even] be ... the
guy that's feeding the dogs on [the] glacier.
So ... we have proposed ... language that would say
that the people directly responsible for the
recreational activity have that training. So, instead
of training hundreds of summer hires, we could train
20 to 30 summer hires that are specifically engaged in
the recreational activity, and that is walking on a
glacier or in the dog sled.
CHAIR ROKEBERG asked whether that proposed language has been
submitted to the committee.
MR. KNUDSON indicated that Ms. Sylvester has that proposed
language.
TAPE 02-48, SIDE B
Number 2390
MS. SYLVESTER confirmed that this proposed language had been
discussed with the sponsor, and noted that he felt that such a
change should be left up to the committee's discretion because
it would be limiting the responsibilities of the providers
somewhat. She pointed out that on [lines 2 and 3], it says,
"employees who are responsible for assisting in the actual
performance of a commercial recreational activity". This
language, she opined, would be construed as the actual raft
guide, for example, since the word "actual" tends to limit who
that language would apply to. She said that while it is not the
sponsor's intent to burden any industry, having CPR and first
aid training is not a bad thing. She said that should there be
an amendment to address this issue, it would simply involve
adding the word "directly" in front of "responsible" on page 3,
line 2.
Number 2298
ROBERT WAGSTAFF, Attorney, testified via teleconference in
opposition to HB 319 after mentioning that he is also a pilot.
He said:
I've been a lawyer for 35 years and a pilot for the
same; I started to fly when I was in law school. A
lot of my law practice is focused upon aircraft-crash
litigation, and [with regard to] my flying, at this
point I have about 10,000 hours in the air and hold an
airline-transport pilot rating and have owned numerous
aircraft and own several now. ... I want to approach
this ... from ... an aviation perspective. When I
take a guest in my aircraft - which from time to time
I do, I invite a friend to go fishing, and they're
looking forward to a good, safe, pleasant, successful
day - they trust me completely with their lives and
safety.
They trust me to get the weather briefing. They trust
that I'm knowledgeable and current on my aircraft and
its operating limitations, as well as my own. They
trust my judgment that I will take them to a place
that is reasonably safe and [that] I will not put them
in a position that may be hazardous to them and that
they may suffer injury from. They have no knowledge
of aviation. They have no knowledge of the [weather
conditions] - they haven't got their own weather
briefing. They have no knowledge of the risk of the
operation of the aircraft in currents; for example,
... if you're taking someone fishing in a river
situation, landing on floats in the river ... can be
quite tricky and can also be quite dangerous.
In terms of their assumption of risk or knowing really
what they're getting into, they don't have a clue
about how really, truly dangerous an operation such as
this can be. They are trusting their lives and safety
solely to me, and that's a responsibility that I have.
And I don't insure their safety; if the engine fails
through no fault of mine, I'm not going to be held
liable for that, or if there is some act of God that
causes them injury, I'm not liable for that. But I'm
going to be liable for my negligence when I do
something that a reasonably prudent person would not
do; when I "push weather" through [Lake Clark] Pass
simply because I want to spend the night in Anchorage
and not at Lake Clark, I'm going to be responsible for
that, as well I should be.
Number 2173
MR. WAGSTAFF continued:
What this bill seems to say, or what it really does,
is eliminate that responsibility by saying, "Well, the
person knows it's dangerous, so whatever happens,
they're on their own." Well, they may know it's
dangerous, but they really do not know the actual
risk, or appreciate the risk, or have any control
whatsoever over what happens. Once we take off, my
passenger, my guest, is totally at my mercy. There's
nothing they can do about anything at that point other
than pray and hope that their trust is not misplaced.
And if I abuse that trust, or if I'm negligent, I'm
going to be responsible for it. And this [proposed]
statute seems to not recognize that very important
public policy that I should be responsible for my
negligence when I take a guest up who's intrusting
himself to me and they have absolutely no control over
what happens.
... I'm speaking primarily at this point to the guest
aspect of the [proposed] statute, but ... what I'm
saying applies equally to commercial operators, and
you would hope more so when the passenger's actually
paying for the service - something that at the least
should make a higher degree of responsibility. In
terms of insurance, I have insurance; I have liability
insurance and "hull insurance." The liability
insurance, to me, seems very reasonably priced. The
hull insurance can get quite expensive: at least 8 to
10 percent of the aircraft value for landing off
airports, ... [and] floatplane operations are
generally - except for Lake Hood - off an airport.
But I have hull insurance as well. The liability
[insurance] is affordable ... - I hesitate to say
reasonably priced, but it certainly is not
unreasonable - and it is obtainable.
Number 2081
MR. WAGSTAFF added:
It would encourage me not to have insurance - I think
I'd have it anyway, I know I would - but ... this
particular bill ... seems to encourage the lack of
insurance. Another point I'd like to make [is] in
terms of ... the inherent risk. In the years that
I've been flying, I knew a lot of people who were
flying, or pilots that are no longer with us, that
have been killed. And these are not just people that
I knew who they were or recognized the name; these are
people that if I saw on the street before the
accidents - their accidents - I would have stopped and
talked to them. They were acquaintances; we knew each
other's name. And probably 20 years ago, I realized I
was forgetting their names - there were so many of
them - and it was hard to keep them straight. And so
I made a list that, unfortunately, I still update
frequently.
And in the 35 years I've been flying, there're over 50
people that I know personally [who] were pilots that
have been killed in aviation. And, without exception,
and I mean literally without exception, there's not
one person whose death was not optional - it did not
need to happen: error of judgment in weather, trying
to fly beyond their own or their equipment's
limitations - the various things that go into making
an aircraft accident. There've been some engine
failures that were attributable to maintenance, but in
the cases in which it happened, they knew about it;
they went ahead anyway and took a chance, and suffered
the consequences.
Now, that's the reality of aviation, and to say that
someone assumes that responsibility when they
innocently take a ride with someone, they have no
knowledge what they're getting into. Their decision
is based completely on trust and the superior
knowledge of the pilot, and the responsibility is
great. So I think that this is really bad public
policy, and I also question the real need for it,
because insurance is available and obtainable, at
least for me....
Number 1968
MR. WAGSTAFF concluded:
I heard a lot of things said today about, "Well, this
doesn't apply to negligence." Well, it does - as I
read it. And the idea of cost sharing - I heard that
initially explained; it was backwards from ... the way
it really is, as far as the FAA is concerned. And ...
I'm not sure what problem's being addressed here; if
there's an insurance crises or insurance rates that
[you're] concerned with, there's absolutely no linkage
between this legislation and any reduction of
insurance, nor is there any relief suggested. So I
question the reason for this - the need for it; the
policy seems reversed. I think that people should be
responsible for their negligence: [If] they don't
insure, they're responsible when they do not do
something that a reasonably prudent person should do.
MR. WAGSTAFF, in response to questions, said that he has
represented both sides - both victims and operators - in
aviation-related disputes, and that when he represents an
operator, although it is the insurance company that pays the
legal fees, he is actually working for the operator, and does
not and cannot directly represent the insurance company.
REPRESENTATIVE BERKOWITZ referred to Section 3 [subsections
(b)(2)(A) and (B)] and asked for an explanation. He said: "In
essence, as I read it, it says this section doesn't apply to a
civil action if the owner has insurance or if he doesn't have
insurance but tells people about [it] - that he doesn't have
insurance." He said that he is wondering how that would have
practical application.
MR. WAGSTAFF said that from an economic standpoint, [that
language] would encourage an operator to not have insurance. He
observed:
This idea of linking liability with the existence - or
nonexistence, in this case - of insurance seems contra
to the basic concept - legal concept - in tort law
that insurance is irrelevant. ... The existence or
nonexistence of insurance can never be mentioned to a
jury because it's thought, and I think rightly so,
that [it] will somehow skew their decision ... one way
or the other. And this linkage here, I really
question it from a policy standpoint. And also it
seems to operate in the wrong direction.
Number 1801
REPRESENTATIVE BERKOWITZ asked for clarification regarding the
term "owner or operator": "If I own an airplane and I let you
use it, you would be the operator? And [if] something happens
to you while you're operating it, how would that play out just
on the basis of the first sentence?
MR. WAGSTAFF, referring to the term "owner or operator", said
that that language is not unusual, but it generally applies to
commercial operations; for example, the "owner" is the air-taxi
company or the air carrier, and the "operator" is an employee.
He opined that that language would be inappropriate for "a guest
situation with a private pilot" because, as is the case with
him, he is both owner and operator. He added, "I guess ... some
people do have corporations that own their aircraft in an
attempt to avoid liability, so I guess it could cover that."
REPRESENTATIVE BERKOWITZ said:
If I let my wife use my boat, and something happens to
her ... Or a friend uses my boat and something
happens to him or her ... I'm just unclear on the
interplay. You've got all these disjunctives running
around in that sentence and it's sort of confusing to
unscramble.
MR. WAGSTAFF agreed.
Number 1698
BRUCE BARKER, Vice President, General Manager, Mount Roberts
Tramway, testified in favor of HB 319. He said:
I would like to encourage you to pass this
legislation. We feel that this would be of benefit to
us ... [as] the second highest visitor activity in the
state after the White Pass Railroad. We do about
200,000 visitors a year.... And I think we need to
keep in mind, one of the main purposes of this is not
so much to base the legislation on what has happened,
but [on] what we might avoid in the future - ... the
nuisance suits, which are extensive....
We feel that this would go a long way in helping us
avoid some of those [situations] where we're being
sued because somebody wasn't watching where they were
going and fell off the trail, or had a heart attack on
the mountain and had to take the tram down and didn't
make it. There's a number of situations like that
that occur. We do our best to try to make our paying
guests aware of the environment that they're entering;
particularly this time of year - early in the season -
we have lots of snow on top of the tram right now,
more than I've ever seen ... in the four years I've
been here. So we will have trails that are covered
with ice; we do have areas that melt out holes
underneath the snow that people can fall into.
MR. BARKER showed the committee a sign that he had brought with
him, and said:
This is a sign that we use early in the season.
There's only two places where the public can get away
from the mountain station of the tram, and we have
signs posted at both spots. Last year I had an
elderly woman who had gone right past this sign,
gotten off of the trail, got lost, fell into a hole,
got stuck in the snow, somehow got herself back to
[the] tram, her husband found her, and her hands were
cut up from grabbing on little branches of trees. And
she [was] very unhappy and felt that I had a very
large amount of responsibility in how she got lost out
there, even though she walked right past this sign.
And I did point the sign out to her, and she
understood that she had walked right past this sign
and didn't read it.
Number 1556
I was very kind to her and took care of her and made
sure she was happy and bought her and her husband
dinner, and they went away happy. We've also had a
number of injuries on the mountain where people have
broken their ankle or broken their wrist ... - mostly
it's due to falling off a trail. And I have always
gotten them quickly to the hospital, and paid for the
ambulance, paid for their deductible - if there was a
deductible - and been happy to do that without getting
into [a] nuisance suit, which, as [Mr. Windred]
pointed out, can be very expensive.
MR. BARKER showed the committee another sign he'd brought with
him and said that it was what he was going to have made up for
the coming season. He said that it addresses the ice and mud
situation a little bit more specifically.
CHAIR ROKEBERG surmised that not all of Mr. Barker's clientele
are English speaking.
MR. BARKER said that is correct, although the majority do speak
English. In response to a question, he confirmed that his
company also uses [signs with] international symbols.
REPRESENTATIVE JAMES surmised that even if HB 319 were to become
law, Mr. Barker would continue to treat clients who have had
similar difficulties in the same manner because negative
publicity is bad for business.
REPRESENTATIVE BERKOWITZ asked Mr. Barker how many lawsuits were
brought against his company last year.
MR. BARKER indicated that he has never had any lawsuits filed
against his company.
CHAIR ROKEBERG suggested that HB 319 would enable companies to
"practice preventative law."
MR. BARKER indicated that they strive to do so as much as
possible. He mentioned the term "guest services," and said that
these include taking care of the guests, making sure they're
happy, addressing their needs, giving them more than what they
were anticipating. By doing these things, he added, "you always
win." He said that the main reason that his company would like
to see HB 319 pass is that even though "I haven't been sued in
six years, I will get sued, and right now I have a lost person
on the mountain - he's been lost since September 10 - and how
that's going to fall out, I have no idea, but ... I hope that we
recover his body this year." He added, "His wife is going to
come back up, and we've been communicating with her," but this
is the type of situation for which it would be very beneficial
to have this bill in place.
Number 1390
MR. BARKER, in response to a question regarding this lost
individual, explained:
He was a 79-year-old Japanese-American, had advanced
Alzheimer's, was with his wife and brother-in-law, the
brother-in-law was assigned the responsibility of
watching him, was sitting at the top of the tram ...
in a public place, and the brother-in-law went over,
going to take a picture, turned around and he was
gone. And we haven't found him; it's a very
interesting situation. ... We called in "search and
rescue," looked ... a big part of the evening. The
next morning, of course, was 9/11, and all our rescue
... people, all the authorities - fire department, et
cetera, et cetera - were totally wrapped up in
emergency reactions to that. We were lucky enough to
get a helicopter in the air with an infrared sensor -
who covered the whole top of the mountain out of the
trees and didn't find a thing.
REPRESENTATIVE BERKOWITZ asked Mr. Barker whether his
[insurance] premiums have gone up in that time.
MR. BARKER said: "We have been informed by our insurance
company that our premiums are going up; 30 to 50 percent is what
my insurance company quoted us. Luckily we ... had signed our
new contract prior to September 11."
REPRESENTATIVE BERKOWITZ said: "I'm unclear why this specific
bit of legislation would take a substantial bite out of that 30
to 50 percent."
MR. BARKER replied:
Well, what this legislation would do is it would
prevent a nuisance suit against me, which would lead
to an increase in my rates; as [Mr. Windred] pointed
out, insurance companies base their rates on what they
call an "experience mod," and as your "experience mod"
increases, then your rates increase.
Number 1293
REPRESENTATIVE BERKOWITZ pointed out, however, that:
As I understand it, you haven't had any nuisance
suits, and yet your rates have already gone up 30 to
50 percent. And it seems to me that maybe the focus
ought to be on the insurance companies who've actually
cost you money, as opposed to these suits, which
haven't.
MR. BARKER said:
Again, ... I'm thinking about the future; I'm not
thinking about ... what has happened in the past. I
haven't had any suits, but I will have suits in the
future; it's guaranteed in our litigious society, and
this is what [we wish] to avoid, and that's why we
support this legislation.
REPRESENTATIVE BERKOWITZ asked Mr. Barker whether he would also
be supportive of legislation that affected the insurance rates
directly.
MR. BARKER asked whether Representative Berkowitz was referring
to liability caps.
REPRESENTATIVE BERKOWITZ said no; liability caps pertain to the
"damage end of things". He clarified that he was referring to
legislation that would affect insurance rates.
MR. BARKER indicated he would be supportive of legislation that
would keep insurance rates under control.
REPRESENTATIVE MEYER asked Mr. Barker whether his company posts
signs warning people of bears and other wildlife. He also asked
who would be responsible if a bear were to chase one of the
passengers.
MR. BARKER said they did have "the typical bear signs at both
trailheads that warn people that bears are around, and it's the
same sign that you see on all the trailheads throughout town;
Trail Mix [Inc.] puts those up for us."
REPRESENTATIVE JAMES mentioned that she is not specifically
focused on lowering insurance rates, because that may only
result in there being fewer insurance companies, which could
result in insurance not being available at all. She said that
she understood the concerns regarding nuisance suits.
Number 1118
CHAIR ROKEBERG made a motion to adopt Conceptual Amendment 1:
On page 3, line 25, after the word "compensated" insert "or
hired". That portion of the bill would then read: "if the
owner or operator is not being compensated or hired for the
transportation." He remarked that such language is consistent
with FAA language.
REPRESENTATIVE BERKOWITZ asked:
Are you trying to say, "is neither being compensated
nor hired"? Or are you trying to say, "is not being
compensated or is being hired"?
CHAIR ROKEBERG, after consulting with committee staff, reminded
members that it is a conceptual amendment; thus the drafter and
committee staff will ensure that the appropriate language is
inserted.
Number 1030
CHAIR ROKEBERG noted that there were no objections to Conceptual
Amendment 1. Therefore, Conceptual Amendment 1 was adopted.
CHAIR ROKEBERG, referring to the suggested change regarding CPR
and first aid training, indicated that he is satisfied that the
current language is clear that only the employees directly
responsible for participants [during] the recreational activity
will be required to have that training.
REPRESENTATIVE JAMES indicated agreement; it "probably wouldn't
apply" to "ticket agents or anything like that."
REPRESENTATIVE BERKOWITZ said: "It seems to me that you're
putting an excessive burden on business ... with this
paragraph." With regard to the tram, for example, the current
language could apply to everybody who opens and closes the tram
doors, or everyone who takes a ticket, or all the greeters; they
are all directly "responsible for assisting participants in the
actual performance of a commercial recreational activity", he
added. Referring to raft trips, he indicated that the same
could be said of everybody who drives a bus, paddles a boat, or
cooks [for the passengers]; because they are all directly
responsible for assisting participants, according to the current
language they would all be required to have this training.
CHAIR ROKEBERG said he disagrees and therefore infers that the
language does need clarification.
REPRESENTATIVE JAMES indicated that according to her
understanding of Representative Berkowitz's interpretation of
the current language, simply adding "directly" won't clarify the
issue.
CHAIR ROKEBERG said he would concede that there is ambiguity in
the current language and thus it is subject to interpretation.
Number 0858
CHAIR ROKEBERG made a motion to adopt Conceptual Amendment 2:
"The [paragraph] (2) on page 3 [lines 2-5] be narrowed in its
scope to mean only those people that are directly and actually
participating in the activity with the client, and therefore
having a limitation on it."
REPRESENTATIVE BERKOWITZ asked how "commercial recreational
activity" is defined.
CHAIR ROKEBERG pointed out that it is defined on page 3, [lines
17-20].
Number 0773
CHAIR ROKEBERG noted that there were no objections to Conceptual
Amendment 2. Therefore, Conceptual Amendment 2 was adopted.
Number 0760
REPRESENTATIVE JAMES moved to report CSHB 319(L&C), as amended,
out of committee with individual recommendations and the
accompanying zero fiscal note.
Number 0753
REPRESENTATIVE BERKOWITZ objected. He said:
It seems to me that this is an anti-business bill ...
because of the requirements that I spoke to earlier.
The definitions of "commercial recreational activity"
as well as "recreational activity" are so broad that
they would in essence account for anything that took
place outdoors, anywhere.... And I don't think it
solves the problem that it's intending to solve, which
is to lower the costs of doing business in the state,
and it certainly doesn't provide additional safety
precautions for consumers of these outdoor
recreational activities. And, therefore, because it
serves no good public purpose whatsoever, I oppose it.
CHAIR ROKEBERG said he disagrees.
REPRESENTATIVE JAMES said she, too, disagrees. She surmised
that the bill recognizes that there is an inherent risk to
[certain activities], and stipulates that just because someone
gets hurt after choosing to participate in an activity, he/she
will not necessarily receive compensation.
Number 0676
A roll call vote was taken. Representatives Coghill, Meyer,
James, and Rokeberg voted to report CSHB 319(L&C), as amended,
out of committee. Representatives Berkowitz and Kookesh voted
against it. Therefore, CSHB 319(JUD) was reported out of the
House Judiciary Standing Committee by a vote of 4-2.
CHAIR ROKEBERG called an at-ease from 2:55 p.m. to 2:56 p.m.
HB 124 - NURS.HOME/ASSISTED LIV. EMPLOYEES/VISITOR
Number 0639
CHAIR ROKEBERG announced that the last order of business would
be HOUSE BILL NO. 124, "An Act prohibiting nursing facilities
and assisted living homes from employing or allowing access by
persons with certain criminal backgrounds, with exceptions."
[Before the committee was CSHB 124(HES).]
Number 0629
REPRESENTATIVE COGHILL moved to adopt the proposed committee
substitute (CS) for HB 124, version 22-LS0087\R, Lauterbach,
4/3/02, as a work draft. There being no objection, Version R
was before the committee.
Number 0592
CHRISTOPHER KNIGHT, Staff to Representative Andrew Halcro,
Alaska State Legislature, sponsor, said, on behalf of
Representative Halcro, that the impetus for HB 124 came from
senior advocacy groups that were interested in "putting 'barrier
crimes' into statute." He noted that a number of senior long-
term care advocates and nursing facility advocates have been
worried about individuals who have [committed] serious offenses
being hired to work in such facilities. He added that [Version
R] defines what constitutes a serious offense. He explained
that currently, the Department of Administration (DOA) and the
Department of Health & Social Services (DHSS) have the statutory
authority to adopt "regulations for 'barrier crimes.'" After
numerous years, he added, one department has done so.
MR. KNIGHT noted that Version R adds the requirement that
potential employees provide a sworn statement that they have not
been convicted of any offenses in which the victim was a
resident of a nursing facility and/or a long-term care facility.
He added that by requiring a sworn statement, "we've removed the
fiscal note."
CHAIR ROKEBERG asked Mr. Knight what he means by "barrier
crime."
MR. KNIGHT said:
We call this the "'barrier crimes' legislation," and
the idea is that those individuals who've been
convicted of heinous crimes - serious offenses -
should not ... [be allowed] to work in our long-term
care facilities and nursing facilities. And [I] think
it's [an] important measure ...; protection and care
of our elders should be of the highest priority.
CHAIR ROKEBERG again asked what is meant by the term 'barrier
crime.'
MR. KNIGHT said:
It's kind of just a colloquial word used when we put
into statute preventative measures from higher and/or
-- I guess just limit one's abilities concerning their
criminal record.
Number 0448
ALISON ELGEE, Deputy Commissioner, Office of the Commissioner,
Department of Administration (DOA), remarked that she is
speaking on behalf of both the DOA and the Department of Health
& Social Services (DHSS). She said:
We certainly support the general concept that
Representative Halcro is trying to address here.
However, we do have some concerns over the language
that is used in the proposed committee substitute for
HB 124. We have made copies ... of what has been
adopted in a joint regulation project by the
Department of Administration and the Department of
Health & Social Services for our assisted-living
licensing function. Now, these do not apply to
nursing homes, but the nursing home certification and
licensing staff have said that they are interested in
adopting corresponding regulations for the nursing
home industry, so that we've got a similar regulation
format for both environments of long-term care. They
simply have not gotten those regulations adopted yet
because of the numerous other projects they've got on
their plate right now.
One of the things that we've done, in terms of
adopting these regulations, is we've taken an approach
where we have some crimes that ... create a permanent
bar for employment in the long-term care industry, and
those are listed ... as "Absolute Barrier Crimes," and
you'll see that in the spreadsheet. So somebody who's
convicted [of] one of these crimes can never ever be
employed in a long-term care environment or in an
assisted living environment, which is what these
regulations apply to. We have then, after identifying
the absolute barriers, ... identified barriers that
are time-barred. So, if you have committed the crimes
that are listed under "10-Year Barrier Crimes" within
the past 10 years, you're not eligible for employment
in an assisted living environment. There are crimes
where you're time-barred for five years, and there
[are] a couple of crimes that are listed as two-year
bars.
Number 0280
MS. ELGEE continued:
This allows [some discretion for] people who have
committed crimes, and ... the case you'll find most
frequently is somebody who's committed a crime in
their youth, and ... 20 years later there's been no
criminal history in between that youthful offense and
today. And the language that's contained in the
committee substitute for [HB 124] would not
distinguish; it would make most of the crimes that we
have put into our barrier-crime regulations permanent
barriers. And that is by virtue of the language that
is contained in both sections; first, in the nursing
home section on page 2, line 14: "a serious offense,
as defined in AS 12.62.900". This makes that serious
offense a permanent bar to employment. [Alaska
Statute] 12.62.900 is any felony offense. So we would
not have that opportunity to differentiate between the
degree of time, or the length of time, since that
crime was committed.
We also are aware of ... an article ... regarding a
Pennsylvania court ruling, (indisc. - coughing)
published in January of this year. [The] state of
Pennsylvania attempted to adopt similar legislation
that just had this broad-sweeping "any criminal
offense, you never can work in long-term care" kind of
approach. And the courts in Pennsylvania ruled that
as being too broad, and said, essentially, that there
... needed to be a nexus between the crime and the
employment environment in order for you to be able to
bar somebody permanently from ever being able to
participate in that employment environment. I've
checked with our attorneys, and they believe that
[with] a permanent bar, such as proposed in HB 124,
that our courts would rule very similarly to the
Pennsylvania courts.
Number 0102
MS. ELGEE concluded:
That said, we have no objection to the language that
is in [HB 124] requiring the sworn statement that the
crimes have never been [committed]; this would allow
us to put a zero fiscal note on this bill. And if the
legislature wants to actually embody in statute more
explicit direction in barrier crimes, we would suggest
that you model the statutory language after the
regulations that we have adopted.
CHAIR ROKEBERG inquired: "You're not suggesting we should
adopt, by reference, your regulations in statute?"
MS. ELGEE replied: "I think that's backwards, Mr. Chairman; I
was suggesting that you actually write into statute ...
permanent barriers and list all the crimes ..."
CHAIR ROKEBERG interjected, remarking that were they to do that,
the bill would become very long.
MS. ELGEE concurred. She went on to say:
We're very happy, Mr. Chairman, just maintaining this
definition in regulation; we think this works very
well. And when Representative Halcro started this
particular legislation, we had not finished the
[adoption] of regulations. But we have, since that
time, actually gotten these regulations adopted; they
were in a public hearing process last year when this
[bill was started].
TAPE 02-49, SIDE A
Number 0001
CHAIR ROKEBERG mentioned that it took the sponsor three months
to request that the bill be heard in the House Judiciary
Standing Committee.
REPRESENTATIVE JAMES said that she agreed with Ms. Elgee that
youthful indiscretions should not become a permanent bar to
employment. She mentioned that some people, early in life, have
had alcohol or drug problems, but have since turned their lives
around, and those people should not automatically be barred from
working in this field. "We have a tough time getting people to
work in these jobs; they're not easy, [and] you've got to have a
lot of compassion," she added. She noted that after quickly
looking over the list provided by Ms. Elgee, she did not see any
problems with it.
Number 0114
LISA CARESS-BEU, President, Center for Advocacy and Rights of
the Elderly (CARING), testified via teleconference in support of
HB 124. She said:
As president of Alaska's only citizen advocacy group
for [protection of the rights] of the elderly, I urge
you to support this bill. Alaska currently has no law
that prohibits nursing homes and assisted living homes
from employing and retaining individuals with criminal
backgrounds.... How has Alaska allowed this situation
to continue unanswered? Now is the time to raise the
bar of expectation when it comes to the care of the
vulnerable elderly in our state. Residents in long-
term care facilities are often incapable of
communicating situations of abuse, neglect, or
financial misappropriation. They're depending on us
to provide for their safety.
Individuals with a history of criminal activity that
may be working in or seeking employment in Alaska's
nursing and assisted living homes must not be allowed
to prey on our most vulnerable senior citizens.
Administrators of long-term care facilities have
complained that to prohibit individuals with criminal
backgrounds from working in their homes shrinks an
already depleted labor pool to a point where
acceptable staffing ratios are impossible to maintain.
This is a nationwide problem; good caregivers are
increasingly difficult to attract. However, this is
no excuse for employing persons ... [with] known
criminal histories. Under no circumstances should a
person that is no longer able to communicate their
needs be subject to [receiving] intimate care from a
person with a known criminal history....
Number 0241
MS. CARESS-BEU concluded:
A 1999 ... legislative audit done on the Alaska
[Pioneers'] Home system [shows] that they employed
four people that had been convicted of sexual abuse.
Would you want one of those employees to be
responsible for bathing your mother or father? You
would never consider allowing a person with such [a]
history to be employed in [the] care of our children.
Why are our frail elders less deserving of our
protection? It's frightening to know that assisted
living homes and nursing homes in Alaska currently
employ people who've been terminated from previous
jobs for substantiated abuse ... [of] long-term care
residents.
Must residents and their families continue to suffer
the employment of people with criminal convictions?
Please take this opportunity to help protect Alaska's
residents of long-term care from predators roaming the
halls of the place that they are to think of as their
home. I applaud Representatives Halcro, Hayes, Dyson,
and Stevens for taking a stance to protect Alaska's
long-term care residents; I ask the rest of this
committee to join them and pass HB 124. Thank you.
Number 0318
AILEEN HERRING, Vice President, Center for Advocacy and Rights
of the Elderly (CARING), testified via teleconference in support
of HB 124. She said:
I believe that [HB 124] will provide added protection
to ... vulnerable elderly adults living in ... nursing
and assisted living homes from predators working as
caregivers. My late father, Frank Y. Swanson, was a
resident of the Sitka and Anchorage [Pioneers'] Homes
for five years. Currently there is no law to prohibit
nursing and assisted living homes from employing
individuals with criminal backgrounds. The 1999
legislative audit lists four individuals employed by
the [Pioneers'] Homes that have been convicted of
sexual assault. Logic would tell us that we do not
want our children cared for by individuals with
convictions of theft, rape, pedophilia, or abuse. Why
don't we offer the same protection to the vulnerable
elderly adult?
House Bill 124 will not place any additional financial
burden on the state, and would help ensure that the
rights and safety of the residents would be protected.
I have a personal interest in [HB 124] being passed
and implemented so that the frail and ... vulnerable
residents in ... nursing and assisted living homes who
often have no voice in their care are assured a safe
environment in their declining years. My father died
under suspicious circumstances at APH [Anchorage
Pioneers' Home], and the suspected caregiver is still
employed as a caregiver. I just want to urge you to
pass [HB 124]; it's a very critical bill, and any
crime against the elderly in a nursing or assisted
living home is totally unacceptable. Thank you.
CHAIR ROKEBERG mentioned that he remembered Ms. Herring's
father.
MR. KNIGHT, commenting on points raised by Ms. Elgee, said:
She says this is a broad-sweeping measure. If you
look at the definition of serious ... offense, which
is ... currently in statute, we talk about ... any
felony ... offense. We currently require that if you
want to vote, you can't be convicted of any felonies,
so that is a barrier crime that's currently within our
statutes. Crime involving domestic violence, crimes
involving sexual assault/sexual abuse of a minor,
incest, unlawful exploitation of a minor, indecent
exposure, contributing to the delinquency of a minor,
distribution of pornography, prostitution - these are
all serious crimes, they're not broad-sweeping
measures. We're not talking about reckless driving
misdemeanor B or C charges. We're talking about
pretty serious crimes.
Number 0532
If you've been convicted of these, you certainly
shouldn't be allowed to work in a nursing facility
where you have vulnerable adults. And that's all
we're trying to get across here. Our senior advocates
are very concerned about regulations; regulations are
not permanent measures.... They can be changed next
week, next year.... As we all know, ... regulations
come and go as administrations come and go, and we
feel that we need to have something within the statute
that has some substance - some teeth - and it's
important to get something in there.
The regulations that the Department of [Health &
Social Services] adopted took five years in the
making. They had the statutory authority five years
ago; it took five years to get ... something into
regulation. The Department of Administration, for
nursing facilities, has yet to adopt regulations;
granted, with the threat of this (indisc.)
legislation, they certainly want to get regulations
into place, but I think ... we need to take some
measures here.
CHAIR ROKEBERG asked whether it is the sponsor's intent to have
a higher level of barrier than the departments have.
MR. KNIGHT said he would not comment on that issue. He added:
"I do know that if you look at the regulations, and I'm not
going to waste the committee's time as far as ... trying to look
for parallels within the regulations and serious crime offense
..."
CHAIR ROKEBERG interjected to say that he was looking at "5-Year
Barrier class C felony 'failure to register as a sex offender or
child kidnapper in the first degree'." He noted that with this
"failure to register" crime, it can be presumed that one has
already committed a sex offense.
MR. KNIGHT agreed. He added: "We're trying to put some teeth
in this statute ...; ... the regulations that the department has
adopted will not be negated by our adoption of the statutes."
Both would be in effect, he remarked; the [departments] would
still have the authority to change their regulations.
CHAIR ROKEBERG remarked to Mr. Knight that he appeared to be in
direct opposition to the department.
MR. KNIGHT disagreed.
CHAIR ROKEBERG said that instead of sending HB 124 to a
subcommittee, he would rather give Mr. Knight and the sponsor
time to work with the departments to develop something
acceptable to all parties.
Number 0683
REPRESENTATIVE JAMES mentioned that she has known people who
have made terrible mistakes in their youth. She also reminded
members that she has often spoken against jumping to make people
felons at a young age. Making someone a felon when he/she is
young can destroy that person's life rather than fixing it, she
added. She mentioned that she was raised to believe in the
concept of forgiveness, and that considering the low number of
people who are even willing to work in this field, she did not
want to say that [every felon] is automatically permanently
barred from that type of employment. She said, "You've got to
make that evaluation on who they are today, what they have been
doing over the last number of years, and what their behavior is
like." She also said:
Drugs and alcohol make a big change in people's lives,
and when they can get over that, and many of them do
..., there's a complete change in their behavior. I
don't want to rule them out and tell them that their
life is no good. So, I would rather have something
that is a little more ... permissive in some certain
cases.... When we need a lot of people to treat ...
[elderly] people compassionately and take care of them
in their vulnerable age, I agree that we need to have
people who are serious about doing it and doing it
right, but I don't want to exclude [people] to the
point that we don't ... have anybody to do it.
REPRESENTATIVE BERKOWITZ asked whether including an element of
discretion in HB 124 would assuage some members' concerns.
REPRESENTATIVE JAMES said it certainly would, adding, "I just
don't want to write people off if they've worked really hard to
rehabilitate themselves."
REPRESENTATIVE BERKOWITZ said: "So, you could do it with
unlocking presumptions, then."
Number 0832
MR. KNIGHT said:
I've got a grandmother currently that has Alzheimer's,
... and she lives in a nursing facility back in South
Carolina. And ... we come from a good Christian
family, she was a good Christian lady growing up, and
... on a personal level, I'd have some serious issues
with someone who'd been convicted of sexual assaults
and sexual abuse of a minor working with my
grandmother who's mentally impaired.... That raises
some serious concerns for me, and I know some of
that's covered - there are some parallels - within
current existing regulations, but I think that we have
an opportunity to put something in statute that's
going to be lasting.
REPRESENTATIVE JAMES acknowledged that she has the same
concerns, but added that when [the crime] of domestic violence
is included, it raises a whole different issue.
CHAIR ROKEBERG asked Ms. Elgee to recap the current status
regarding the adoption of the aforementioned regulations.
MS. ELGEE said:
The regulations for the assisted living environment,
which cover both the Department of Administration and
the Department of Health & Social Services, were
adopted last August. And I would like to clarify that
even ahead of this absolute laundry list, so that
everybody ... knew what the ground rules were, we were
conducting criminal background checks. It was just
that we did not have a black and white list that says
"yes" to this one, and "no" to that one.
CHAIR ROKEBERG announced that the HB 124 [Version R] would be
held over.
ADJOURNMENT
Number 0904
There being no further business before the committee, the House
Judiciary Standing Committee meeting was adjourned at 3:18 p.m.
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