Legislature(1993 - 1994)
04/14/1993 01:00 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE April 14, 1993 1:00 p.m. MEMBERS PRESENT Representative Brian Porter, Chairman Representative Jeannette James, Vice-Chair Representative Pete Kott Representative Joe Green Representative Cliff Davidson Representative Jim Nordlund MEMBERS ABSENT Representative Gail Phillips OTHER MEMBERS PRESENT Representative Gene Therriault Representative Cynthia Toohey COMMITTEE CALENDAR HB 28 "An Act relating to the penalty for providing alcoholic beverages to a person under the age of 21; and providing for an effective date." CSHB 28 (JUD) PASSED OUT WITH A DO PASS RECOMMENDATION HB 92 "An Act relating to notaries; and providing for an effective date." CSHB 92 (JUD) PASSED OUT WITH A DO PASS RECOMMENDATION HB 188 "An Act relating to forfeiture of certain property; and providing for an effective date." HEARD AND HELD IN COMMITTEE HB 211 "An Act relating to the municipal tax exemption for inventories intended for export." PASSED OUT WITH A DO PASS RECOMMENDATION HB 195 "An Act authorizing youth courts by which to provide for peer adjudication of minors who have allegedly committed violations of state or municipal laws, renaming the community legal assistance grant fund and amending the purposes for which grants may be made from that fund in order to provide financial assistance for organization and initial operation of youth courts, and relating to young adult advisory panels in the superior court." NOT HEARD HB 222 "An Act relating to landlords and tenants, to termination of tenancies and recovery of rental premises, to tenant responsibilities, to the civil remedies of forcible entry and detainer and nuisance abatement, and to the duties of peace officers to notify landlords of arrests involving certain illegal activity on rental premises." NOT HEARD WITNESS REGISTER GAYLE HORETSKI, Committee Counsel House Judiciary Committee Alaska State Legislature State Capitol, Room 120 Juneau, Alaska 99801-1182 Phone: 465-6841 Position Statement: Reviewed changes in CSHB 28 (JUD) and CSHB 92 (JUD) REPRESENTATIVE GENE THERRIAULT Alaska State Legislature State Capitol, Room 421 Juneau, Alaska 99801 Phone: 465-4797 Position Statement: Prime sponsor of HB 92; supported CSHB 92 (JUD) CHARLIE COLE Attorney General Department of Law P. O. Box 110300 Juneau, Alaska 99811-0300 Phone: 465-3600 Position Statement: Supported HB 188 DEAN GUANELI Assistant Attorney General and Criminal Division Administrator Department of Law P. O. Box 110300 Juneau, Alaska 99811-0300 Phone: 465-3428 Position Statement: Answered questions related to HB 188 RAY BROWN Alaska Academy of Trial Lawyers P. O. Box 102323 Anchorage, Alaska 99510 Phone: 277-5400 Position Statement: Voiced concerns about HB 188; urged changes be made to HB 188 REPRESENTATIVE CYNTHIA TOOHEY Alaska State Legislature State Capitol, Room 104 Juneau, Alaska 99801-1182 Phone: 465-4919 Position Statement: Prime sponsor of HB 211 MITCH GRAVO Anchorage Economic Development Corporation 2550 Denali, 17th Floor Anchorage, Alaska 99503 Phone: 272-6474 Position Statement: Supported HB 211 PREVIOUS ACTION BILL: HB 28 SHORT TITLE: PENALTY FOR PROVIDING ALCOHOL TO A MINOR BILL VERSION: SPONSOR(S): REPRESENTATIVE(S) WILLIAMS,Phillips,B.Davis, Nicholia,Olberg,Bunde,Kott TITLE: "An Act relating to the penalty for providing alcoholic beverages to a person under the age of 21; and providing for an effective date." JRN-DATE JRN-PG ACTION 01/04/93 31 (H) PREFILE RELEASED 01/11/93 31 (H) READ THE FIRST TIME/REFERRAL(S) 01/11/93 31 (H) HES, JUDICIARY, FINANCE 01/13/93 54 (H) COSPONSOR(S): OLBERG 01/14/93 62 (H) COSPONSOR(S): BUNDE 02/10/93 312 (H) COSPONSOR(S): KOTT 03/04/93 (H) HES AT 03:00 PM CAPITOL 106 03/04/93 (H) MINUTE(HES) 03/05/93 539 (H) HES RPT 3DP 3NR 03/05/93 539 (H) DP: BUNDE, TOOHEY, NICHOLIA 03/05/93 540 (H) NR: KOTT, VEZEY, BRICE 03/05/93 540 (H) -2 FISCAL NOTES (CORR, ADM) 3/5/93 03/05/93 540 (H) -3 ZERO FNS (LAW, DPS, ADM) 3/5/93 03/24/93 (H) JUD AT 01:00 PM CAPITOL 120 03/24/93 (H) MINUTE(JUD) 04/14/93 (H) JUD AT 01:00 PM CAPITOL 120 BILL: HB 92 SHORT TITLE: REGULATION OF NOTARIES PUBLIC BILL VERSION: CSSSHB 92(JUD) AM SPONSOR(S): REPRESENTATIVE(S) THERRIAULT TITLE: "An Act relating to notaries; and providing for an effective date." JRN-DATE JRN-PG ACTION 01/27/93 163 (H) READ THE FIRST TIME/REFERRAL(S) 01/27/93 164 (H) LABOR & COMMERCE, JUDICIARY 02/01/93 198 (H) SPONSOR SUBSTITUTE INTRODUCED- REFERRALS 02/01/93 198 (H) LABOR & COMMERCE, JUDICIARY 02/02/93 (H) L&C AT 03:00 PM CAPITOL 124 02/02/93 (H) MINUTE(L&C) 02/03/93 210 (H) L&C RPT CSSS(L&C) 1DP 3NR 02/03/93 211 (H) DP: HUDSON 02/03/93 211 (H) NR: PORTER, WILLIMS, GREEN 02/03/93 211 (H) -ZERO FISCAL NOTE (GOV) 2/3/93 02/03/93 224 (H) COSPONSOR(S): JAMES 02/05/93 241 (H) COSPONSOR REMOVED: JAMES 03/31/93 (H) JUD AT 01:00 PM CAPITOL 120 03/31/93 (H) MINUTE(JUD) 04/14/93 (H) JUD AT 01:00 PM CAPITOL 120 BILL: HB 188 SHORT TITLE: FORFEITURE OF CERTAIN PROPERTY BILL VERSION: SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR TITLE: "An Act relating to forfeiture of certain property; and providing for an effective date." JRN-DATE JRN-PG ACTION 03/01/93 489 (H) READ THE FIRST TIME/REFERRAL(S) 03/01/93 490 (H) JUDICIARY, FINANCE 03/01/93 490 (H) -4 ZERO FNS (ADM, ADM, DPS, LAW) 3/1/93 03/01/93 490 (H) GOVERNOR'S TRANSMITTAL LETTER 04/05/93 (H) JUD AT 01:00 PM CAPITOL 120 04/06/93 (H) JUD AT 01:00 PM CAPITOL 120 04/07/93 (H) JUD AT 02:00 PM CAPITOL 120 04/12/93 (H) JUD AT 01:00 PM CAPITOL 120 04/14/93 (H) JUD AT 01:00 PM CAPITOL 120 BILL: HB 211 SHORT TITLE: MUNICIPAL INVENTORY TAX EXEMPTION:EXPORTS BILL VERSION: HB 211 AM S SPONSOR(S): REPRESENTATIVE(S) TOOHEY,Brown,Menard; TITLE: "An Act relating to the municipal tax exemption for inventories intended for export." JRN-DATE JRN-PG ACTION 03/10/93 590 (H) READ THE FIRST TIME/REFERRAL(S) 03/10/93 590 (H) CRA, JUDICIARY 03/12/93 629 (H) COSPONSOR(S): BROWN 03/25/93 (H) CRA AT 01:00 PM CAPITOL 124 04/01/93 (H) CRA AT 01:00 PM CAPITOL 124 04/01/93 (H) MINUTE(CRA) 04/02/93 931 (H) CRA RPT 5DP 2NR 04/02/93 931 (H) DP:SANDERS,DAVIES,TOOHEY, OLBERG, WILLIAMS 04/02/93 931 (H) NR: BUNDE, WILLIS 04/02/93 931 (H) -ZERO FISCAL NOTE (DCRA) 4/2/93 04/14/93 (H) JUD AT 01:00 PM CAPITOL 120 BILL: HB 195 SHORT TITLE: AUTHORIZING YOUTH COURTS BILL VERSION: SPONSOR(S): REPRESENTATIVE(S) SITTON,Ulmer,Willis,Foster, Brown,B.Davis,Olberg,Porter TITLE: "An Act authorizing youth courts by which to provide for peer adjudication of minors who have allegedly committed violations of state or municipal laws, renaming the community legal assistance grant fund and amending the purposes for which grants may be made from that fund in order to provide financial assistance for organization and initial operation of youth courts, and relating to young adult advisory panels in the superior court." JRN-DATE JRN-PG ACTION 03/03/93 519 (H) READ THE FIRST TIME/REFERRAL(S) 03/03/93 519 (H) HES, JUDICIARY, FINANCE 03/12/93 628 (H) COSPONSOR(S): WILLIS, FOSTER, BROWN 03/12/93 628 (H) COSPONSOR(S): B.DAVIS, OLBERG 03/19/93 716 (H) COSPONSOR(S): PORTER 03/24/93 (H) HES AT 03:00 PM CAPITOL 106 03/31/93 (H) HES AT 03:00 PM CAPITOL 106 03/31/93 (H) MINUTE(HES) 03/31/93 (H) MINUTE(HES) 04/01/93 (H) HES AT 03:00 PM CAPITOL 106 04/01/93 (H) MINUTE(HES) 04/02/93 (H) HES AT 03:00 PM CAPITOL 106 04/02/93 (H) MINUTE(HES) 04/05/93 974 (H) HES RPT CS(HES) NEW TITLE 5DP 2NR 1AM 04/05/93 974 (H) DP:BUNDE,G.DAVIS,TOOHEY, B.DAVIS, NICHOLIA 04/05/93 974 (H) NR: VEZEY, OLBERG 04/05/93 974 (H) AM: KOTT 04/05/93 974 (H) -2 ZERO FNS(DCRA, DHSS) 4/5/93 04/14/93 (H) JUD AT 01:00 PM CAPITOL 120 BILL: HB 222 SHORT TITLE: USE OF RENTED PROPERTY/LAW VIOLATIONS BILL VERSION: SPONSOR(S): REPRESENTATIVE(S) JAMES,Porter TITLE: "An Act relating to landlords and tenants, to termination of tenancies and recovery of rental premises, to tenant responsibilities, to the civil remedies of forcible entry and detainer and nuisance abatement, and to the duties of peace officers to notify landlords of arrests involving certain illegal activity on rental premises." JRN-DATE JRN-PG ACTION 03/12/93 619 (H) READ THE FIRST TIME/REFERRAL(S) 03/12/93 619 (H) LABOR & COMMERCE, JUDICIARY 04/01/93 (H) L&C AT 03:00 PM CAPITOL 17 04/01/93 (H) MINUTE(L&C) 04/02/93 932 (H) L&C RPT 3DP 4NR 04/02/93 932 (H) DP: WILLIAMS, MULDER, PORTER 04/02/93 932 (H) NR: GREEN, MACKIE, SITTON, HUDSON 04/02/93 932 (H) -2 FISCAL NOTES (DPS, LAW) 4/2/93 04/12/93 (H) JUD AT 01:00 PM CAPITOL 120 04/13/93 1188 (H) FIN REFERRAL ADDED 04/14/93 (H) JUD AT 01:00 PM CAPITOL 120 ACTION NARRATIVE TAPE 93-60, SIDE A Number 000 The House Judiciary Standing Committee meeting was called to order at 1:17 p.m., on April 14, 1993. A quorum was present. Chairman Porter announced that the committee would take up HB 28 first. HB 28: PENALTY FOR PROVIDING ALCOHOL TO A MINOR Number 023 GAYLE HORETSKI, COMMITTEE COUNSEL, HOUSE JUDICIARY COMMITTEE, called the members' attention to a draft committee substitute for HB 28, dated April 1, 1993. She noted that a subcommittee, chaired by Representative Kott, had met to discuss HB 28, and stated that the sponsor, Representative Bill Williams, concurred with the subcommittee's recommendations incorporated in the draft committee substitute. MS. HORETSKI stated that new language appeared on page 1, lines 6-10 of the draft committee substitute. She mentioned that under existing law, it was a misdemeanor crime to provide alcohol to a minor. The original HB 28 made all such offenses class C felonies, she noted. However, the draft committee substitute made providing alcohol to a minor a class C felony only if the provider had been previously convicted of that same offense within the preceding five years. MS. HORETSKI commented that new language also appeared on page 2, in sections 3 and 4. Under existing law, she said, liquor establishments had to post warning signs regarding drinking alcohol during pregnancy. New language in HB 28 required liquor licensees to post a second sign, citing the penalties for providing alcohol to minors. Those penalties included imprisonment for up to five years and a fine of up to $50,000. She mentioned that those penalties would apply to second and subsequent offenses, but not to first offenses. Number 098 REPRESENTATIVE JOE GREEN asked Ms. Horetski to describe the penalties for first offenses. Number 106 MS. HORETSKI replied that a first offender would be guilty of a class A misdemeanor. Number 123 REPRESENTATIVE JIM NORDLUND stated that he was a member of the subcommittee, although he had not been notified that the subcommittee was meeting. But, he said, he was happy with the product which the subcommittee had created. He called the draft committee substitute an improvement to a bill about which he still had concerns. Number 135 REPRESENTATIVE PETE KOTT indicated that the subcommittee had met, and had notified Representative Nordlund's office of the meeting. He mentioned that it had been almost impossible to get all of the subcommittee members to agree on a time at which to meet. He added that the subcommittee had attempted to address the committee's concerns in the draft committee substitute for HB 28. Number 156 REPRESENTATIVE JEANNETTE JAMES made a MOTION to ADOPT the draft committee substitute for HB 28, dated April 1, 1993. There being no objection, IT WAS SO ORDERED. Number 160 REPRESENTATIVE CLIFF DAVIDSON commented that our society was becoming a society of signs. He asked the Chairman to comment, from his perspective as a former police officer, on the deterrent effect of signs. Number 173 CHAIRMAN BRIAN PORTER responded that during his career as a police officer, he had spent a great deal of time in bars. It was his impression that as long as there were some liquor handlers interested in providing alcohol to minors and some minors who were intent on purchasing alcohol, it would happen, regardless of whatever signs might be present. He stated that posting signs would not hurt, however. Number 210 REPRESENTATIVE DAVIDSON indicated that the committee would be filling up the statute books with language that might or might not have an impact on the behavior of individuals. He stated his opposition to moving HB 28 out of committee. Number 231 REPRESENTATIVE JAMES commented that it was difficult to measure the effect of signs. She said that people often did not notice that a particular sign was posted, but when a person saw a sign, he or she knew that he or she had seen the sign before. That, she said, counted for something. She supported posting signs. Number 252 REPRESENTATIVE KOTT echoed some of Representative Davidson's comments. But, he said that if one sign saved one life, then it would be worth posting them in bars and liquor stores throughout the state. Number 276 REPRESENTATIVE NORDLUND reiterated his earlier statement that the committee substitute was a vast improvement over the original HB 28. He indicated his belief that the legislature should fashion penalties appropriate to crimes. He did not know if a person would be any more deterred by the notion of spending five years in prison than he or she would be by the notion of spending one year in jail. Number 290 REPRESENTATIVE JAMES asked rhetorically what penalty would he deem appropriate in the event that an adult provided alcohol to a minor, and that intoxicated minor went out and killed himself? She said that she would like to give judges the option of imposing a stiffer penalty in such a situation. Number 305 REPRESENTATIVE DAVIDSON stated that society owed its children the opportunity to learn for themselves about self- discipline and personal responsibility. He stated that instead of micro-managing Alaska's businesses, the legislature should focus its efforts on the children. He commented that, as a parent, he found the more he said no, the more he had to say no. He drew a parallel by asserting that the more signs society posted, the more signs society would have to post. Number 337 CHAIRMAN PORTER agreed with Representative Davidson's comments, except to say that some people would not respond to education and positive reinforcement, and therefore required criminal sanctions. He mentioned the evolving role of smoking in our society. Smoking became unpopular not because it was criminalized, he said, but because of a combination of elements which made smoking "uncool." He noted that HB 28 might help prevent adults from providing alcohol to minors. Number 382 REPRESENTATIVE JAMES made a MOTION to MOVE the Judiciary Committee substitute for HB 28 out of committee, with individual recommendations. There being no objection, IT WAS SO ORDERED. CHAIRMAN PORTER announced that the committee would take up HB 92 next. HB 92: REGULATION OF NOTARIES PUBLIC Number 399 REPRESENTATIVE GENE THERRIAULT, PRIME SPONSOR of HB 92, called the members' attention to a draft committee substitute dated April 9, 1993. He said that the committee substitute dealt with issues on which the committee had expressed the desire for clarification and change. He supported the draft committee substitute, as did Ms. Patty Trott from the Lieutenant Governor's Office. Number 417 MS. HORETSKI commented that at the previous hearing on HB 92, the committee had a committee substitute before it. The April 9, 1993 draft committee substitute was a change from the previous committee substitute, she added. She said that new language appeared on page 2, lines 7-9. The phrase "applying for" was added, in order to clarify timetables within the bill. She commented that new language clarified the types of crimes which would make a person ineligible to be a notary. MS. HORETSKI stated that language requiring notaries to notarize all items presented to them, on page 3, line 13, was deleted from HB 92. Additionally, she said, on lines 17-18 of page 3, the language was reworded to allow notaries to promote or endorse products, but not to use their notarial seals or titles to do so. On page 3, lines 20-21, the words "notarial certificate" were substituted for "document," she said, based on language in the Model Notary Act. The last change was located on page 4, lines 30-31, and established who should notify the Lieutenant Governor's Office in the event that a notary public died. Number 480 REPRESENTATIVE GREEN asked Ms. Horetski to clarify HB 92's language regarding false certificates. Number 484 MS. HORETSKI explained that the language to which Representative Green was referring was identical to that in the last version of HB 92. Number 490 REPRESENTATIVE DAVIDSON asked what would happen in the event that a notary public's next of kin did not notify the lieutenant governor's office that the notary public had died. Number 493 MS. HORETSKI replied that there were no enforcement mechanisms for that requirement included in HB 92. Number 498 REPRESENTATIVE GREEN asked if HB 92's sponsor concurred with the changes in the draft committee substitute. REPRESENTATIVE THERRIAULT indicated that he concurred. Number 502 REPRESENTATIVE GREEN made a MOTION to ADOPT the draft committee substitute dated April 9, 1993. There being no objection, IT WAS SO ORDERED. REPRESENTATIVE GREEN made a MOTION to MOVE the Judiciary Committee substitute for HB 92 out of committee. There being no objection, IT WAS SO ORDERED. CHAIRMAN PORTER announced that the committee would take up HB 188 next. HB 188: FORFEITURE OF CERTAIN PROPERTY Number 524 CHARLIE COLE, ATTORNEY GENERAL, STATE OF ALASKA, commented that he had intended to submit legislation this session modeled on a successful California program which did away with the necessity of notaries public. He urged the committee to look into adopting a similar program in Alaska. MR. COLE testified in support of HB 188, and said that the bill was one of the governor's priorities. He said that the bill would provide for forfeiture of real property under certain conditions, and would result in a major, positive change to the state's forfeiture laws. He stated that a great deal of drug activity centered around the illicit use of real property. Under present law, he said, real property could not be forfeited. He noted that there was a "gaping hole" in the state's forfeiture laws. MR. COLE suggested that the committee change language on page 6, line 23, of the work draft dated April 12, 1993, to avoid subjecting a claimant to the heavy burden of proving that he or she did not have "reasonable cause to believe" that drug activity was conducted on the real property. He recommended deleting the words "or have reasonable cause to believe." Number 600 MR. COLE stated that currently, forfeiture cases were handled by the U. S. Attorney, not the state, as the federal government had greater forfeiture powers for real property than the state did. Thus, much of the proceeds of a successful forfeiture went to the federal government. He said that if HB 188 was enacted, the legislature would supervise and control forfeitures. If complaints were heard about abuse of forfeiture powers, the legislature could restrict the state's authority. Number 632 REPRESENTATIVE JAMES said that her question pertained to both HB 188 and to HB 222, Use of Rented Property/Law Violations, which she had sponsored. She said that HB 222 required law enforcement authorities to notify property- owners if someone other than the property-owner was arrested. She asked if authorities had notified a property- owner of an arrest, but the property-owner did not evict the tenants, was the property-owner then "knowledgeable" about the illegal activity and subject to the forfeiture of his or her property. REPRESENTATIVE JAMES offered an example of a family living in a rental unit when the husband was indicted. If the landlord was notified of the indictment, but did not evict the tenants, and the wife was later indicted, she asked if the landlord would be seen as having reason to know that illegal activity was taking place on the premises. Number 652 MR. COLE stated that he would have to think about HB 188's effect on such a situation. He stated that an indictment did not mean that a person was guilty. Number 669 CHAIRMAN PORTER stated that if an arrest was made and a person jailed as a result, a person would not be deemed to "reasonably know" that illegal activity was continuing while the defendant was in jail. Number 677 MR. COLE commented that most forfeiture situations were worked out at an administrative level and did not go to a hearing. Number 694 CHAIRMAN PORTER mentioned that the unfortunate reality was that budgets were so low that prosecutors and law enforcement officials did not have time to work on marginal cases. If officials knew that they could not prove that a property-owner knew about the illegal activity taking place on his or her property, they would not pursue the forfeiture case. Number 701 REPRESENTATIVE NORDLUND supported the state's efforts in trying to achieve the forfeiture of property that was used in the commission of a crime, particularly in the case of drug offenses. However, he expressed concerns that HB 188 could negatively impact innocent property-owners. He said that the bill could be improved by allowing for forfeiture only in the cases in which a conviction occurred and/or there was a showing that the property was materially used in the commission of the crime. Number 714 MR. COLE asked if the language on page 1, line 11 did not adequately address Representative Nordlund's concern. REPRESENTATIVE NORDLUND replied that the language to which Mr. Cole had referred pertained to property, but not to the owners. Number 731 MR. COLE responded that language in sections 4 and 7 of the bill seemed to provide adequate safeguards. Additionally, he said that the amendment which he had suggested would go even further to protect against innocent property-owners having their property seized. REPRESENTATIVE DAVIDSON offered an example in which a person owned a new home. That person's grown children returned home to live with that person, having become involved in drug trafficking while living away from home. The person had always trusted the children, and saw no reason to keep close track of the children's activities. As a result of the drug trafficking, the person's home was seized. He asked Mr. Cole to outline the steps that the person would have to go through in order to ensure that the real property was not forfeited. Number 766 MR. COLE indicated his belief that it was not difficult to keep track of activities going on in one's home. He then outlined the stages governing Representative Davidson's hypothetical situation. He said that the person would very likely know if an arrest was made, and therefore not need to learn about the proposed forfeiture when notice of it was advertised in the newspaper. He stated that section 4 of HB 188 provided for public notice of proposed forfeiture actions. MR. COLE said that the person would then be required to make a claim under oath, setting out his or her interest in the property, the date it was acquired, the acquisition price, and then generally answering the state's allegations of forfeiture. If the person did not make a claim, then forfeiture would be ordered by the court without further proceedings. Number 790 MR. COLE stated that section 7, beginning on page 6, line 15 of the work draft, established the standards for a timely claim. He said that a person could have property returned upon proof, by a preponderance of evidence that (1) the person had a valid interest in the acquired property, acquired in good faith; (2) he or she did not knowingly participate in or facilitate the conduct that resulted in the property being subject to forfeiture; and (3) the person did not know that another person might engage in conduct that resulted in the property being subject to forfeiture. Number 808 REPRESENTATIVE DAVIDSON asked if Mr. Cole was saying that a person had, in effect, to prove his or her innocence. MR. COLE replied in the affirmative. REPRESENTATIVE DAVIDSON asked about what would happen if a person missed making a timely claim, due to being out of state on vacation for six weeks. He asked Mr. Cole if he felt that there should be some sort of appeal process included in HB 188. TAPE 93-60, SIDE B Number 000 MR. COLE replied that similar situations already occurred, including notification that a bank was going to foreclose on a house. He said that HB 188 was no greater danger than many existing laws, as it included standard and routine notice periods. Number 022 REPRESENTATIVE DAVIDSON expressed a concern that the forfeiture process proceeded rather swiftly. Number 029 MR. COLE commented that 30 days in which to file a claim was somewhat generous, in light of other time periods used for legal proceedings. Number 039 REPRESENTATIVE GREEN mentioned that section 7 appeared to violate "innocent until proven guilty" constitutional protections. Number 052 MR. COLE responded that there were no constitutional problems in HB 188, in his opinion. He said that there were many provisions in civil law which placed the burden of proof on the citizen. He gave the Internal Revenue Code as an example. He noted that the basic presumption of innocence was with regard to the commission of a crime. He asked how law enforcement officials could prove that a property-owner knew about illegal activity occurring on his or her real property. He said that it was not unreasonable to impose the burden of proof on the property-owner. MR. COLE stated that a property-owner would not find it difficult to prove that he or she did not know about the illegal activity. Number 109 REPRESENTATIVE NORDLUND asked Mr. Cole to offer his opinion on restricting HB 188's provisions to those situations in which a conviction occurred. Number 118 MR. COLE replied that Representative Nordlund's suggestion was an intermediate step, one on which he did not choose to express an opinion. He said that it would result in a less- strict law. CHAIRMAN PORTER asked Mr. Dean Guaneli, from the Department of Law's Criminal Division, to compare HB 188 with federal forfeiture requirements. DEAN GUANELI, ASSISTANT ATTORNEY GENERAL, CRIMINAL DIVISION ADMINISTRATOR, DEPARTMENT OF LAW, testifying via telephone, stated that he believed that a conviction was not a prerequisite for forfeiture in any jurisdiction. He said that a conviction was definitely not a requirement under current Alaska forfeiture law. He said that the problem with basing forfeiture on conviction was that lack of a conviction did not prove a defendant's innocence. Often, he said, a conviction did not occur due to suppression of evidence, invalid search warrants, or police mistakes. MR. GUANELI expressed an opinion that the state should still be able, in certain circumstances, to go after property used in the commission of a drug offense, even if no conviction resulted. He noted that forfeiture was viewed as a proceeding which was separate and apart from a criminal case; therefore, the outcome of the criminal case should have no bearing on the forfeiture proceeding. Number 185 REPRESENTATIVE NORDLUND mentioned concerns which had been raised regarding the state seizing a cruise ship, if drugs were found aboard. Number 196 MR. GUANELI stressed that the state would take reasonable actions with regard to forfeitures. He said that the state had found evidence of drug dealing on cruise ships in the past, and had taken no actions against the ship owners. He added that drug dealers used Alaska Airlines jets to convey drugs to Alaska on occasion, and the jets were not seized by the state. He reiterated the Attorney General's comment that most forfeiture cases would be worked out at the administrative level. MR. GUANELI mentioned that if the state had evidence that a girlfriend or other associate of a drug trafficker was listed on a title or deed in order to protect certain assets, the state would aggressively pursue forfeiture of the property. On the other hand, he said, if a parent or wife knew nothing of drug trafficking occurring in their home, there was no point in the state pursuing forfeitures. He said that the whole point behind forfeiture laws was to make people take care of the property that they owned, so that it was not used in drug dealing. MR. GUANELI said that forfeiting an Alaska Airlines jet, or a cruise ship, or the assets of a lending institution would not further the purposes of forfeiture laws. He reiterated the Chairman's comment that the state did not have time to pursue marginal forfeiture cases. Number 245 MR. COLE expressed his opinion that if a cruise ship captain knew that his or her vessel was being used for drug trafficking, then the state ought to seize the ship. Number 273 REPRESENTATIVE DAVIDSON commented that operators were not necessarily owners. He asked Mr. Cole what protections HB 188 offered to property-owners. MR. COLE replied that HB 188 included lien protections in section 7, on page 6, line 19. Number 284 RAY BROWN, representing the ALASKA ACADEMY OF TRIAL LAWYERS, testified in support of forfeiture laws, but stated that he had many concerns about HB 188. He urged the committee to make substantial changes to the bill before passing it out of committee. He predicted that HB 188 would make lawyers rich, and only benefit the entity which received the proceeds from successful forfeitures. MR. BROWN stated that only those who could afford to litigate civil forfeitures would have an opportunity to regain their property; less-affluent citizens would simply lose their property, even if they were innocent of any wrongdoing, because they could not afford to litigate forfeiture issues. He argued that if law enforcement officials had a monetary incentive to seize assets of significant value, then such forfeiture matters would not be worked out administratively. He called HB 188 extremely dangerous. MR. BROWN stated further that a cruise ship company might have no idea that a particular crew member was running a drug trafficking operation out of one of the company's ships. But, according to the Attorney General, if the company did not know of the operation, but the ship's captain did, the company's vessel should be forfeited. He commented that the state merely had to get an indictment or establish probable cause to make a prima facie showing that the property was forfeitable. He said that it was extremely easy for the state to get an indictment. MR. BROWN commented that if an indictment established a prima facie showing, then people who could not afford to litigate a forfeiture action would lose their property. He stated his opinion that a conviction should not be necessary for the state to seize property. He mentioned that children hid many things from their parents. He said that, under HB 188's provisions, if a parent had sent a child with a drug problem to a rehabilitation facility, and that child returned home, a parent could potentially be found to have reason to know that his or her child was selling drugs. MR. BROWN said that if a child was selling marijuana out of his or her room, and was indicted for that offense, a parent who could not afford to hire an attorney to defend him- or herself could lose his or her home. He commented that HB 188 placed an unfair burden on people. He stated that allowing law enforcement agencies and prosecutors to keep the proceeds from forfeiture cases provided too great of an incentive for seizures. He asserted that parts of HB 188 were unconstitutional. MR. BROWN said further that the bill's requirement regarding filing claims on one's seized property violated Fifth Amendment rights. He commented that currently, when the state handed over forfeiture cases to the federal government, the proceeds were shared between the federal government, the state, and local law enforcement agencies. He stated that HB 188 should not change that situation. Or, he said, it might result in several agencies scrambling to forfeit assets in order to receive the proceeds. CHAIRMAN PORTER noted that Mr. Brown's comments about current sharing of proceeds were correct. He indicated his understanding that under HB 188's provisions, proceeds would go into the state's general fund, not to specific agencies. Number 460 MR. BROWN said that it was his understanding that proceeds would go directly to the agencies responsible for the seizures, but said that he might be wrong. He indicated his support for the proceeds being deposited into the general fund instead. He praised law enforcement officials in Alaska, but expressed concern that if a big enough incentive to seize property existed, forfeiture authority might be abused. MR. BROWN commented that lending institutions would probably object to HB 188, as it would require them to prove that they had no knowledge that illegal activities were occurring on real property for which they had lent money. He said that the only people who would praise the bill would be lawyers who would be hired to represent people whose property had been seized. He said that HB 188 invited abuse. Number 489 REPRESENTATIVE JAMES asked Mr. Brown to clarify his opinion regarding law enforcement abuse of HB 188. Number 496 MR. BROWN indicated his belief that a law enforcement officer would only seize property if she or he believed that there was probable cause to seize that property. But, he said, a law enforcement officer would not know, at the time of seizure, that a property-owner was innocent of any wrongdoing. He said that innocent property-owners would suffer under HB 188, as the cost of litigation would often outweigh the cost of the assets seized. He commented on Representative James' HB 222, Use of Rented Property/Law Violations. MR. BROWN mentioned that he used to live in a condominium where a neighbor was a crack dealer. He stated that there was very little that could be done about these people, because probable cause could not be established to enter the premises. He said that, under HB 188, the same situation existed for a banker, who had heard that someone to whom he or she had lent money for a car was a drug dealer. He said that the banker or a landlord could risk a libel suit by seizing the automobile, or evicting tenants. He said that HB 188 put tenants, lienholders, and bankers in a ridiculous position. Number 529 REPRESENTATIVE JAMES asked if HB 188 did not protect liens. Number 532 MR. BROWN replied in the affirmative. He offered a hypothetical situation in which a banker had lent a person money with which to buy a car. In the eighth month that the person was making payments on the car, the banker learned that the person was using the car for drug dealing. "What would the banker do?" he asked. The banker technically had knowledge of the illegal activity and its relationship to the car, he said. Number 538 CHAIRMAN PORTER mentioned the Attorney General's recommendation that language on page 6, line 23 of the April 12, 1993 work draft, "or have reasonable cause to believe" be deleted. He asked Mr. Brown if he believed that the situation that he had just described would meet the test of knowledge. Number 545 MR. BROWN said that if the forfeiture was litigated, then it would not meet the knowledge test. However, if a person was arrested and indicted, the forfeiture would still have to be litigated. A property-owner would probably win such a case, although it would cost him or her a great deal of money in legal fees. Number 552 CHAIRMAN PORTER asked Mr. Brown how he would propose to fix HB 188. Number 555 MR. BROWN responded that consensus should be reached among the Department of Law, the Public Defender Agency, the Office of Public Advocacy, and the criminal defense bar on how to amend HB 188 so that it was palatable to all parties. He expressed his concern over the burden of proof contained in HB 188, as well as the fact that the bill could hurt innocent people. MR. BROWN mentioned that a New York law held that real property could not be forfeited unless it contributed directly and materially to the commission of a specified serious felony offense. Also, he said, there had to be knowledge and complicity. Number 584 MR. GUANELI agreed with Mr. Brown in that he was in favor of forfeiture laws. He also agreed with an ACLU position paper which noted that forfeiture laws were a useful and powerful tool in the war against drugs. He said that HB 188 was designed to take the profit out of drug dealing, therefore serving as a deterrent. He responded to Mr. Brown's contention that HB 188 was unconstitutional, as it would require a defendant to disclose information about his or her defense, or perhaps incriminate him-or herself before trial. Number 599 MR. GUANELI noted that the Alaska Supreme Court had said that the preferred procedure, if a defendant would have to disclose something about his or her defense, or would have to incriminate him- or herself in a forfeiture proceeding, was to postpone the forfeiture proceeding until after the criminal case was resolved. Therefore, he said that Mr. Brown's concern was invalid. He asserted that HB 188 was not unconstitutional. He said that to contend that HB 188 would cause innocent property-owners to lose their property was overstating the case. MR. GUANELI reminded the committee members that the state already had a forfeiture law which contained most of the provisions included in HB 188. He stated that Alaska's forfeiture laws were not used often, because they were not as adequate as federal forfeiture laws. He noted that the state often used the federal system to accomplish much of what HB 188 would allow the state to do itself. He commented that the state was interested in seizing greenhouses in which marijuana was grown, as well as buildings which were built and used solely for drug operations. Number 628 MR. GUANELI indicated that the state was not interested in pursuing the forfeiture of the family home of someone whose adult child sold cocaine on one occasion in that house. He said that prosecutors would not bother to pursue cases involving innocent property-owners. He commented that HB 188 started with the current Alaska drug forfeiture law, and made some specific changes to it. The bill, he said, would permit forfeiture of real property, and would permit prosecutors to trace drug money to property purchased with that money. MR. GUANELI indicated that HB 188 would require that forfeiture proceeding costs be paid by the drug dealers. Additionally, he said that HB 188 allowed the court to seize non-related assets of a drug dealer, in the event that the dealer destroyed related assets, or moved them out of the jurisdiction. He stated that HB 188 was designed to prevent drug dealers from hiding the assets from their business in coin collections, works of art, etc., and to take the profit out of drug dealing. He said that the bill was not designed to run roughshod over innocent people. MR. GUANELI commented that HB 188 resolved some ambiguities in Alaska forfeiture laws, which the courts had noted. He called the members' attention to his written summary of what HB 188 did to protect innocent property-owners. Under current Alaska law, he said, a car, boat, or plane could be forfeited unless a lending institution proved that it was not knowledgeable of the vehicle's involvement in drug activity. An Alaska Supreme Court case held that there was a very strict test for allowing property to be forfeited. MR. GUANELI said that the Supreme Court had held that if, prior to parting with property, the lienholder did not know or have reasonable cause to believe that the property would be used to violate the law, or that the violator had a criminal record or a reputation for committing certain crimes, property could be forfeited. He commented that HB 188 reversed that court opinion and said that it was not enough to show that a bank knew of a borrower's drug dealing reputation, nor was it enough to show that a bank knew of a borrower's criminal record. MR. GUANELI stated that HB 188 provided that a bank had to know or have reasonable cause to believe that an offense would occur. He said that HB 188 offered significant protection to lending institutions. TAPE 93-61, SIDE A Number 000 MR. GUANELI, in response to an earlier question from Representative James, said that if a landlord was notified of a drug offense after it had occurred, that landlord could not be reasonably expected to know what had occurred before he or she had knowledge of the offense. He added that if a landlord was unable to evict a tenant, it was inappropriate that forfeiture of the real property occur. He reiterated his statement that HB 188 was designed to deter drug dealers, and that seizing property of innocent-owners and lending institutions did not further that purpose. Number 034 REPRESENTATIVE DAVIDSON stated that Alaska had a forfeiture law, which some people contended did not go far enough. He said that everyone wanted to take property from those who had acquired it through illegal means. But, it seemed to him that Mr. Guaneli was saying, "Trust me -- we do not want to go after innocent people." The fact was, he asserted, that sometimes innocent parties had their property seized and HB 188 would require those innocent people to prove that they did not have any knowledge of the illegal activity. He had not heard any guarantees that innocent people's property would not be seized. Number 072 MR. GUANELI commented that the state now used federal law to accomplish much of what HB 188 would allow the state itself to do. One benefit of HB 188, he said, was that the state would assert control over forfeiture cases, instead of handing that control over to the federal government. He noted that any law could be abused, but said that HB 188 contained protections not found in federal forfeiture laws. He mentioned the "60 Minutes" program regarding federal forfeiture law, and stated that HB 188 would result in a different way of handling such cases. Number 089 MR. GUANELI said that if money was seized under current Alaska law, officials were required to present evidence to a judge within 48 hours, connecting the money to drug dealing. If that evidence was not brought forth, he said, the money had to be returned to its owner. He stated that there was apparently a requirement under federal law that, in order for a person to file a claim for seized property, he or she had to put up a 10% bond. He noted that there was no such requirement under Alaska forfeiture law. MR. GUANELI commented that HB 188 was an attempt to make Alaska law workable, so that the state could avoid using federal forfeiture laws. Number 191 REPRESENTATIVE DAVIDSON asked Mr. Guaneli if the impetus for HB 188 had come from the governor, or the attorney general, or himself. Number 196 MR. GUANELI replied that forfeiture bills had been before the legislature for the past six years. Previous bills were much broader than HB 188, he noted. He stated that the impetus for HB 188 had been the attorney general. Number 215 REPRESENTATIVE DAVIDSON commented that, if HB 188 was introduced in order to bring forfeiture proceeds to the state instead of to the federal government, then it sounded as if incentive issues were at play. Number 222 REPRESENTATIVE JAMES noted that she would feel more comfortable if, in cases of titled property in which the name on the title was different from that of the accused party, property-owners would be presumed innocent until proven otherwise. Number 244 MR. GUANELI mentioned that large-scale drug dealers were very adept at hiding their property and holding it in such a way as to prevent its forfeiture. He said that if the legislature enacted a bill which in essence instructed people on how they ought to structure the titles on their property, criminals would do whatever they needed to do to place their property under others' names in order to prevent its forfeiture. He said that such an amendment would place a heavy burden of proof on the state, merely because of a specific name on a title. Number 271 REPRESENTATIVE NORDLUND asked if Mr. Brown had any response to Mr. Guaneli's comments. He indicated that he would like to see the state have the ability to seize real property, but wanted to see protections included in HB 188. CHAIRMAN PORTER asked Mr. Brown to offer specific suggestions on ways to amend HB 188. Number 285 MR. BROWN suspected that when federal forfeiture laws were written, the U.S. attorney had given the same sort of "trust me" assurances which the committee was hearing from the Department of Law. He said that the committee should not put a lot of trust into those assurances. He suggested that the committee, at a minimum, raise the standard of proof at least to "clear and convincing evidence," instead of a preponderance of evidence. MR. BROWN said that in his eleven years as a criminal defense attorney, he had not found that drug dealers were terribly sophisticated about hiding their assets. He also suggested that the bill require that seized property have contributed materially and directly to a serious drug transaction, instead of the loose and tangential relationship now contained in HB 188. Also, he said that defendants and other property-owners should have to know about, consent to, and otherwise be an accomplice in the drug activity. Number 332 CHAIRMAN PORTER commented that the state had had a forfeiture law, excluding real property, on the books for years. He asked Mr. Brown if he knew of any cases in which a person's property was forfeited due to his or her child selling drugs while using that person's car or airplane. Number 336 MR. BROWN did not know of any such cases. However, he said that HB 188 represented a substantial change in the current forfeiture laws, for example, the inclusion of real property, and property traceable to drug offenses. CHAIRMAN PORTER stated that it was his understanding that HB 188 did not change the standards for seizing property. Number 368 REPRESENTATIVE DAVIDSON asked for Mr. Guaneli's comments on the idea of putting together a group to try to reach consensus on the forfeiture issue. Number 377 MR. GUANELI responded that he had worked with defense attorneys in the past on legislation. He expressed an opinion that there would be deep, philosophical differences in a working group, over the appropriateness of HB 188. He was not confident that putting a working group together would result in a consensus. He indicated his willingness to work with others, however. He stated that HB 188 was a very narrowly-crafted bill. Number 402 REPRESENTATIVE DAVIDSON said that it would be useful for him to have a list of areas where the experts disagreed. Number 414 CHAIRMAN PORTER mentioned Mr. Brown's concern regarding the constitutionality of requiring a person to testify against him- or herself in a forfeiture proceeding, when a criminal matter was not yet resolved. He commented that it had been explained that that would be precluded from occurring. CHAIRMAN PORTER noted that requiring a preponderance of evidence or clear and convincing evidence, as was a standard burden of proof for civil cases, was a policy call for the committee. He stated that the committee might be overlooking the fact that the state already had a forfeiture law in place; HB 188 merely added real property to that law. Also, he said that federal forfeiture policies might be more onerous than that which was proposed in HB 188. Consequently, he said, passage of HB 188 might result in more protections for property-owners. Number 454 CHAIRMAN PORTER stated that his reading of the bill indicated that property had to have a direct and material link to drug activity in order to be forfeited. Number 466 REPRESENTATIVE DAVIDSON understood that the Alaska Academy of Trial Lawyers had intended to provide proposed amendment language to the committee. Number 469 REPRESENTATIVE NORDLUND responded that he had received a letter from Ms. Christine Schleuss of the Alaska Academy of Trial Lawyers regarding suggested language, and had distributed that letter to the committee members. He said that he would like to offer an amendment requiring that the standard of proof be raised to clear and convincing evidence in cases involving real property. He did not yet have the amendment drafted. Number 510 MR. GUANELI stated that the proposed amendment might be acceptable to him, although he would like to give the idea some more thought. Number 530 CHAIRMAN PORTER asked the committee members if there were other specific areas of the bill that they wished to consider amending. Number 540 MR. BROWN stated that he would like to review proposed amendments to HB 188. Number 546 REPRESENTATIVE DAVIDSON commented that the Alaska Academy of Trial Lawyers' letter raised the issue of a prohibition against state enforcement officers initiating federal forfeiture proceedings. Number 552 CHAIRMAN PORTER commented that that issue was completely out of the province of HB 188. REPRESENTATIVE DAVIDSON asked if the committee should be looking into addressing that issue in another bill. CHAIRMAN PORTER stated that Representative Davidson could introduce legislation addressing that issue, if he so desired. He did not know of any situations in Alaska that those testifying on HB 188 feared would occur if the bill was enacted. He stated that the state had given prosecutors and law enforcement officials the same power of arrest and indictment, and noted that in many cases, arresting a person for a heinous offense would have a much greater impact on a person's life than seizing that person's house or car. Yet, he said, although a person could be ruined by an improper arrest, that did not mean that no one should ever be arrested. Number 580 REPRESENTATIVE NORDLUND stated that it was his understanding that any proceeds from forfeited property would have to go into the general fund, as the state had a constitutional prohibition against dedicated funds. CHAIRMAN PORTER concurred. The only way that they would find their way to state law enforcement agencies or prosecutors, he said, was through legislative appropriations. Number 600 REPRESENTATIVE GREEN asked if the state's current forfeiture laws required property-owners to prove that their property was not linked to drug transactions. Number 610 MR. GUANELI stated that he understood Representative Green to ask if current law contained similar protections for innocent property-owners. He said that HB 188 expanded statutory provisions protecting innocent owners. He predicted that, under current law, Alaska's courts would probably interpret existing protections to include those additional protections provided in HB 188. Number 642 REPRESENTATIVE GREEN commented that the difference in language between HB 188 and existing law seemed to indicate that a significant change was being made in the law. He stated that existing law seemed less burdensome for property-owners than did the proposed language in HB 188. He asked if the legislature would be creating a situation which would be more prone to abuse than the situation created by existing law. Number 656 MR. GUANELI expressed an opinion that HB 188 provided greater protection than did existing law. He indicated that the Alaska Supreme Court had applied a fairly strict test regarding the circumstances under which a person would be considered knowledgeable about a drug offense. Number 667 CHAIRMAN PORTER asked Mr. Guaneli, Ms. Horetski, Ms. Schleuss, and Ms. Margot Knuth to craft a committee substitute which would strike "or have reasonable cause to believe" on page 6, line 23. Also, he asked that clear and convincing evidence be incorporated as the standard for forfeiture of real property. He asked that the committee substitute be ready for the committee's review on Friday. Number 683 MR. GUANELI stated that he would be out of town through Friday, but could be available via telephone. Number 687 CHAIRMAN PORTER announced that the committee would take up HB 211 next. HB 211: MUNICIPAL INVENTORY TAX EXEMPTION:EXPORTS Number 706 REPRESENTATIVE CYNTHIA TOOHEY, PRIME SPONSOR of HB 211, explained that the bill would remove a "glitch" in the statutes regarding local business inventory taxes which prevented the transportation hub of Anchorage from becoming an international warehousing and distribution center. She said that the bill would allow municipalities to opt to exempt goods being held for shipment out of state from inventory property taxes. REPRESENTATIVE TOOHEY noted that Alaska's proximity to Asia and the potential for opening a northeastern sea route to Europe were tremendous incentives for warehousing businesses to locate in Alaska. House Bill 211 would allow a local government to explore opportunities for attracting warehousing and distribution businesses. A local government would decide what tax exemptions to allow, and then create its own ordinance to govern those exemptions. REPRESENTATIVE TOOHEY stated that the bill had a zero fiscal note, and enjoyed the support of the Department of Community and Regional Affairs, the Alaska Municipal League, and other entities. Number 735 MITCH GRAVO, representing the ANCHORAGE ECONOMIC DEVELOPMENT CORPORATION (AEDC), stated that his organization strongly supported HB 211. He said that the AEDC was actively trying to attract warehousing business from large corporations to Anchorage. House Bill 211 would make the AEDC's job much easier, he added. Number 744 REPRESENTATIVE KOTT asked if, under current law, municipalities could exempt from taxation property intended to be exported out of state. REPRESENTATIVE TOOHEY replied in the affirmative. REPRESENTATIVE KOTT asked what HB 211 would accomplish then. Number 752 REPRESENTATIVE TOOHEY responded that HB 211 would allow a municipality to make exemptions as it saw fit. Number 768 REPRESENTATIVE KOTT made a MOTION to MOVE HB 211 out of committee, with individual recommendations and a zero fiscal note. There being no objection, IT WAS SO ORDERED. ADJOURNMENT CHAIRMAN PORTER adjourned the meeting at 3:30 p.m.