Legislature(1993 - 1994)
03/25/1994 01:15 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE March 25, 1994 1:15 p.m. MEMBERS PRESENT Rep. Brian Porter, Chairman Rep. Jeannette James, Vice-Chair Rep. Gail Phillips Rep. Pete Kott Rep. Joe Green Rep. Jim Nordlund MEMBERS ABSENT Rep. Cliff Davidson OTHER LEGISLATORS PRESENT Rep. Terry Martin Rep. Harley Olberg COMMITTEE CALENDAR HB 47: "An Act relating to primary elections and to the delivery of the primary ballots to persons making application for them when, by operation of political party rule, two or more primary ballots must be provided to the public." CSHB 47 MOVED OUT OF COMMITTEE HB 518: "An Act extending the termination date of the Board of Governors of the Alaska Bar Association; and providing an effective date." MOVED OUT OF COMMITTEE SB 151: "An Act providing for oil and gas exploration incentive credits for certain activities on certain land in the state; and providing for an effective date." CSSB 151 MOVED OUT OF COMMITTEE HB 367: "An Act relating to the control of outdoor advertising." CSHB 367 MOVED OUT OF COMMITTEE WITNESS REGISTER REPRESENTATIVE TERRY MARTIN Alaska State Legislature State Capitol, Room 411 Juneau, AK 99801-1182 465-3783 Position Statement: Prime Sponsor of HB 47 JACK CHENOWETH Legislative Legal Counsel Department of Law 130 Seward St. Juneau, AK 99801 465-2450 Position Statement: Testified on HB 47 JOSEPH L. SWANSEN, Director Division of Elections Office of the Lieutenant Governor P.O. Box 110017 Juneau, AK 99811-0017 Position Statement: Testified on HB 47 PHILIP R. VOLLAND Alaska Bar Association 211 H. St. Anchorage, AK 99501 276-5231 Position Statement: Testified on HB 518 KEN BOYD, Deputy Director Division of Oil and Gas Department of Natural Resources P.O. Box 107034 Anchorage, AK 99510-0734 762-2548 Position Statement: Testified via teleconference on SB 151 CARL MEYER Income & Excist Audit Division Department of Revenue P.O. Box 110420 Juneau, AK 99811-0420 465-2343 Position Statement: Testified on SB 151 REPRESENTATIVE HARLEY OLBERG Alaska State Legislature State Capitol Juneau, AK 99801-1182 465-4859 Position Statement: Prime Sponsor of HB 367 CHRYSTAL SMITH Alaska Municipal League 217 2nd St., Suite 200 Juneau, AK 99801 Position Statement: Testified on HB 367 LYNN STANTON HCR 64 Box 386 Seward, AK 99664 224-2344 Position Statement: Testified via teleconference on HB 367 JERRY LUCKHAUPT, Attorney Legislative Legal Counsel Division of Legal Services Legislative Affairs Agency 130 Seward St. Juneau, AK 99801 465-2450 Position Statement: Testified on HB 367 DAVID KAMRATH, Legislative Assistant Representative Harley Olberg Alaska State Legislature State Capitol Juneau, AK 99801-1182 465-4859 Position Statement: Testified on HB 367 PREVIOUS ACTION BILL: HB 47 SHORT TITLE: ABSENTEE BALLOTS - PRIMARY ELECTIONS SPONSOR(S): REPRESENTATIVE(S) MARTIN JRN-DATE JRN-PG ACTION 01/12/93 43 (H) READ THE FIRST TIME/REFERRAL(S) 01/12/93 43 (H) STATE AFFAIRS, JUDICIARY, FINANCE 01/28/93 (H) STA AT 08:00 AM CAPITOL 102 01/30/93 (H) STA AT 08:00 AM CAPITOL 102 01/30/93 (H) MINUTE(STA) 02/04/93 (H) STA AT 08:00 AM CAPITOL 102 02/06/93 (H) STA AT 08:00 AM CAPITOL 102 02/06/93 (H) MINUTE(STA) 02/09/93 (H) STA AT 08:00 AM CAPITOL 102 02/11/93 (H) MINUTE(STA) 02/13/93 (H) STA AT 08:00 AM CAPITOL 102 02/18/93 (H) STA AT 08:00 AM CAPITOL 102 02/18/93 (H) MINUTE(STA) 03/02/93 (H) STA AT 08:00 AM CAPITOL 102 03/02/93 (H) MINUTE(STA) 03/04/93 (H) STA AT 08:00 AM CAPITOL 102 03/04/93 (H) MINUTE(STA) 03/05/93 540 (H) STA RPT CS(STA) NEW TITLE 3DP 4NR 03/05/93 540 (H) DP: VEZEY, SANDERS, KOTT 03/05/93 540 (H) NR: ULMER, B.DAVIS, OLBERG, G.DAVIS 03/05/93 540 (H) -FISCAL NOTE (GOV) 3/5/93 02/07/94 (H) JUD AT 01:15 PM CAPITOL 120 02/07/94 (H) MINUTE(JUD) 03/25/94 (H) JUD AT 01:00 PM CAPITOL 120 04/05/94 3119 (H) JUD RPT CS(JUD) NEW TITLE 5DP 1NR 04/05/94 3119 (H) DP: GREEN,KOTT,JAMES,PORTER, PHILLIPS 04/05/94 3119 (H) NR: NORDLUND 04/05/94 3119 (H) -FISCAL NOTE (GOV) 4/5/94 04/12/94 (H) FIN AT 08:30 AM HOUSE FINANCE 04/13/94 (H) FIN AT 08:30 AM HOUSE FINANCE 04/14/94 3425 (H) FIN RPT CS(FIN) NEW TITLE 2DP 5NR 2AM 04/14/94 3425 (H) DP: MARTIN, GRUSSENDORF 04/14/94 3425 (H) NR: LARSON, HANLEY, HOFFMAN, BROWN 04/14/94 3425 (H) NR: MACLEAN 04/14/94 3425 (H) AM: PARNELL, THERRIAULT 04/14/94 3426 (H) -ZERO FISCAL NOTE (GOV) 4/14/94 04/15/94 3465 (H) RULES TO CALENDAR 4/15/94 04/15/94 3465 (H) READ THE SECOND TIME 04/15/94 3466 (H) FIN CS ADOPTED UNAN CONSENT 04/15/94 3466 (H) ADVANCED TO THIRD READING UNAN CONSENT 04/15/94 3466 (H) READ THE THIRD TIME CSHB 47(FIN) 04/15/94 3466 (H) PASSED Y37 N- E3 04/15/94 3467 (H) EFFECTIVE DATE SAME AS PASSAGE 04/15/94 3530 (H) TRANSMITTED TO (S) 04/18/94 3750 (S) READ THE FIRST TIME/REFERRAL(S) 04/18/94 3750 (S) STATE AFFAIRS 04/25/94 (S) STA AT 09:00 AM BUTROVICH ROOM 205 BILL: HB 518 SHORT TITLE: EXTEND ALASKA BAR ASSOCIATION SPONSOR(S): JUDICIARY JRN-DATE JRN-PG ACTION 03/04/94 2608 (H) READ THE FIRST TIME/REFERRAL(S) 03/04/94 2608 (H) JUDICIARY 03/21/94 (H) JUD AT 01:00 PM CAPITOL 120 03/21/94 (H) MINUTE(JUD) 03/25/94 (H) JUD AT 01:00 PM CAPITOL 120 BILL: SB 151 SHORT TITLE: OIL & GAS EXPLORATION INCENTIVE CREDITS SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR JRN-DATE JRN-PG ACTION 03/05/93 618 (S) READ THE FIRST TIME/REFERRAL(S) 03/05/93 618 (S) OIL & GAS, JUDICIARY, FINANCE 03/05/93 618 (S) ZERO FISCAL NOTES (DNR, REV) 03/05/93 619 (S) GOVERNOR'S TRANSMITTAL LETTER 03/16/93 (S) O&G AT 08:00 AM 03/16/93 (H) MINUTE(O&G) 03/16/93 (S) MINUTE(O&G) 03/23/93 (S) O&G AT 05:00 PM BUTROVICH ROOM 205 03/23/93 (S) MINUTE(O&G) 03/30/93 (S) MINUTE(O&G) 03/31/93 1002 (S) O&G RPT 3DP 1DNP/AM 03/31/93 1002 (S) PREVIOUS ZERO FNS (DNR, REV) 04/15/93 1418 (S) JUD REFERRAL WAIVED Y11 N9 04/18/93 1468 (S) FIN RPT 6DP 1DNP 04/18/93 1468 (S) PREVIOUS ZERO FNS (DNR, REV) 04/18/93 (S) FIN AT 01:00 PM SENATE FINANCE 04/18/93 (S) MINUTE(FIN) 04/18/93 (S) MINUTE(RLS) 04/21/93 1613 (S) RULES 3CAL 1NR 4/21/93 04/21/93 1620 (S) MOVED TO BOTTOM OF CALENDAR 04/21/93 1633 (S) READ THE SECOND TIME 04/21/93 1633 (S) AM NO 1 FAILED Y9 N11 04/21/93 1634 (S) AM NO 2 FAILED Y7 N13 04/21/93 1634 (S) ADVANCE TO THIRD READING FAILED Y11 N9 04/21/93 1634 (S) THIRD READING 4/22 CALENDAR 04/22/93 1675 (S) READ THE THIRD TIME SB 151 04/22/93 1675 (S) PASSED Y14 N6 04/22/93 1675 (S) EFFECTIVE DATES SAME AS PASSAGE 04/22/93 1675 (S) JACKO NOTICE OF RECONSID 04/23/93 1714 (S) RECON TAKEN UP - IN THIRD READING 04/23/93 1715 (S) PASSED ON RECONSIDERATION Y14 N6 04/23/93 1715 (S) EFFECTIVE DATES SAME AS PASSAGE 04/23/93 1717 (S) TRANSMITTED TO (H) 04/24/93 1508 (H) READ THE FIRST TIME/REFERRAL(S) 04/24/93 1508 (H) OIL & GAS, RESOURCES, FINANCE 01/31/94 (H) O&G AT 05:00 PM CAPITOL 124 01/31/94 (H) MINUTE(O&G) 02/02/94 2215 (H) ADOPT AMENDMENT 02/02/94 2215 (H) O&G RPT 3DP 2NR 02/02/94 2215 (H) DP: KOTT, G. DAVIS, GREEN 02/02/94 2215 (H) NR: SITTON, OLBERG 02/02/94 2215 (H) -ZERO FISCAL NOTE (DNR) 2/2/94 02/02/94 2216 (H) JUD REFERRAL ADDED 02/23/94 (H) MINUTE(ECO) 03/04/94 (H) RES AT 08:15 AM CAPITOL 124 03/04/94 (H) MINUTE(RES) 03/07/94 2641 (H) RES RPT HCS(RES) 6DP 03/07/94 2641 (H) DP: HUDSON, GREEN, JAMES, MULDER 03/07/94 2641 (H) DP: BUNDE, WILLIAMS 03/07/94 2641 (H) -ZERO FISCAL NOTE (REV) 3/7/94 03/07/94 2641 (H) -PREVIOUS ZERO FISCAL NOTE (DNR) 2/2/94 03/21/94 (H) JUD AT 01:00 PM CAPITOL 120 03/21/94 (H) MINUTE(JUD) 03/25/94 (H) JUD AT 01:00 PM CAPITOL 120 BILL: HB 367 SHORT TITLE: PROHIBITED HIGHWAY ADVERTISING SPONSOR(S): REPRESENTATIVE(S) OLBERG JRN-DATE JRN-PG ACTION 01/13/94 2052 (H) READ THE FIRST TIME/REFERRAL(S) 01/13/94 2052 (H) TRANSPORTATION, JUDICIARY 02/23/94 (H) MINUTE(ECO) 03/01/94 (H) TRA AT 05:00 PM CAPITOL 17 03/01/94 (H) MINUTE(TRA) 03/11/94 2716 (H) TRA RPT CS(TRA) NEW TITLE 4DP 1NR 03/11/94 2717 (H) DP: VEZEY, G.DAVIS, HUDSON, FOSTER 03/11/94 2717 (H) NR: MULDER 03/11/94 2717 (H) -ZERO FISCAL NOTE (DOT) 3/11/94 03/12/94 (H) MINUTE(ECO) 03/23/94 (H) JUD AT 01:00 PM CAPITOL 120 03/25/94 (H) JUD AT 01:00 PM CAPITOL 120 ACTION NARRATIVE TAPE 94-51, SIDE A Number 000 The House Judiciary Standing Committee was called to order at 1:15 p.m. on March 25, 1994. A quorum was present. CHAIRMAN PORTER stated that the following bills would be heard: HB 47, HB 518, SB 151, and HB 367. He called Representative Terry Martin to come forward and introduce HB 47. HB 47 - ABSENTEE BALLOTS - PRIMARY ELECTIONS Number 019 REP. TERRY MARTIN, Prime Sponsor of HB 47, testified that the CS for this bill addresses many of the questions previously raised. He then deferred to Jack Chenoweth from Legislative Legal Services to address the CS. Number 052 JACK CHENOWETH, Legislative Legal Services, testified that he has eliminated the requirement that multiple ballots be sent to applicants if the director or staff were not able to determine which ballot was proper and has in the long material being added from the middle of page 3 on to the top of page 4, laid out a team by which the director or his staff would make a determination as to which is the proper ballot and if, after going through all of this, it's still not possible, based on representation made by the applicant or records in the custody of the division, then and only then is the statutory ballot to be given. He said they have also closed the window of opportunity to change party affiliation in the 30 day period preceding the primary. This conforms with the 30 day pre-general election requirement for party affiliation registration. Number 095 JOSEPH SWANSON, Director, Division of Elections, Office of the Lieutenant Governor, testified that they are very supportive of the bill and are proud of the work done on the bill. Number 112 REP. PHILLIPS inquired whether just public radio would be used for an education campaign or would private radio also be used. Number 115 MR. SWANSON responded that they have funding to also use private TV and private radio. Number 118 REP. JAMES moved to adopt the Judiciary CS to HB 47. Number 119 CHAIRMAN PORTER, hearing no objection, adopted the CS. Number 120 REP. JAMES moved that CSHB 47 be moved from committee with individual recommendations and accompanying fiscal note. Number 138 CHAIRMAN PORTER, hearing no objection, declared CSHB 47 moved from committee. Number 142 HB 518 - EXTEND ALASKA BAR ASSOCIATION PHILIP VOLLAND, President of the Board of Governors of the Alaska Bar Association, testified in support of HB 517 and stated that HB 517 reflects the recommendation of the Legislative Budget and Audit Committee that the function of the Alaska Bar Association continue for another four years. He further testified that by statute, disciplinary, admission assessment, fee assessments, continuing legal education, pro bono services, all are designed to enhance public perception and their confidence in how attorney's serve the interests of clients. The Budget and Audit Committee found that the bar fulfills this function effectively and at no cost to the state. The board is able to function because of its power to assess fees against every lawyer in the state and those fees cover the activities of the board. Number 256 REP. GREEN inquired how the bar handles complaints that come before them and where these complaints originate. Number 270 MR. VOLLAND responded principally by complaints by clients or other lawyers. The discipline council of the Bar Association has authority to bring action on his or her own based upon information the council may receive and that that happens occasionally. But by and large most of the complaints are by either clients or other lawyers. The council then works up a series of hearings depending on how significant the complaint may be. Sometimes a complaint is disposed of by the lawyer agreeing to a private discipline. Other times it goes to a hearing committee, which is a committee composed of lawyers and members of the public. Lawyers can then appeal that and go to the Board of Governors which can act as an independent board hearing the same evidence and depending on the level of sanction, all significant discipline has to approved by the Supreme Court which can review the record entirely on its own. Number 295 REP. GREEN inquired if the bar's hammer is that if they call Johnson in and he doesn't show then the bar can make a pretty harsh recommendation. Number 300 MR. VOLLAND responded that they could. Number 310 REP. PHILLIPS inquired whether all other states have a Board of Governors and when was Alaska's established. Number 315 MR. VOLLAND responded that Alaska's Board of Governors was established in 1955. Number 338 REP. NORDLUND inquired what the bar's response has been to the Legislative Budget and Audit report. Number 345 MR. VOLLAND responded that some of the recommendations they agree with, but Audit found that one of their board terms is out of sync with the statutory rotation and the bar is taking action to change that. Number 420 REP. NORDLUND inquired as to the recommendation that the Bar Association establish a toll free complaint line. Number 429 MR. VOLLAND responded that that recommendation was under review and the bar may very well adopt it. Number 432 REP. GREEN recommended that the committee move HB 518 from committee with individual recommendations and accompanying zero fiscal note. Number 435 CHAIRMAN PORTER, hearing no objection, declared HB 517 moved from committee and next brought SB 151 before the committee. Number 441 SB 151 - OIL & GAS EXPLORATION CREDITS REP. JOE GREEN, testified that SB 151 is a companion bill to HB 199, which was the exploration licensing bill; this being a companion bill in that it is another encouragement to get some sort of delineation, or discoveries in remote areas of the state. This bill would allow the commissioner of Natural Resources to grant relief on taxes to a company or companies that spent money that would be acceptable to the commissioner as exploration dollars, up to a limit, against either their existing production taxes or against the development of something that they might find in the areas they are looking at. I have for the committees review a handout which could help explain the differences between this tax incentive and an existing tax incentive program that has been on the books since statehood. Rep. Green further testified that this bill applies to unleased state land and private land as well and does not just confine itself to taxes from state land. The dollar limit under the current program is five million allowable per company for each operation. The concept there is that five million is a pretty small amount in relation to the total program. SB 151 would have a sunset in ten years. The concept there is to get some activity in a close time frame so that the time it takes from discovery to development would ensure the solvency. The confidentiality provision in the existing credits is that a person can drill an exploratory well where there is unleased land around that well, he can request the commissioner hold the material confidential so it does not become a benefit to people who might bid on adjacent land. That provision has been in law for some time. SB 151 puts a maximum cap of two years on the confidentiality provisions. This is a credit allowance and all the dollars have to be approved by the commissioner. If this bill is passed there would be a maximum of fifty percent of the expenses, not to exceed five million, done on state land, and up to twenty-five percent of that done on private land. Number 573 REP. PHILLIPS inquired on page 2, line 30, section E, the amount of the exploration explained there is determined by the commissioner. Is that a normal procedure, he asked, and how they will develop those guidelines as far as limits that normally occur? Number 580 REP. GREEN responded that the commissioner determines what is eligible and quite often, what is negotiated before hand is a situation like, "I'm going to go out and drill on this land and I'm going to have these kinds of costs." Number 582 REP. PHILLIPS inquired whether other states have these kind of incentive credits. Number 589 REP. GREEN responded that there are incentive credits in other states which are to a greater or lesser extent. In Texas, they don't have the undrilled land that we do in Alaska. Number 595 CHAIRMAN PORTER inquired as to whether, for the record, it could be explained the difference between the state benefits from drilling on and discoveries on private land verses state land. Number 598 REP. GREEN responded that the benefit would be is that where they are adjacent, and the well is in close proximity, say within a lease of two by two square miles, there would be a significant interest to the state because the field might be large enough to extend on state land. But in the other areas, let's say this is on Native land, but perhaps several miles from the nearest state border, it would be relative small value. There would still be value because there would be an area you could tie seismic work to. Number 626 CHAIRMAN PORTER inquired into the revenue differences to the state from producing on state land versus private land. Number 628 REP. GREEN responded we wouldn't have any royalties from private land. We would have severance and ad valorem taxes. Number 630 REP. NORDLUND inquired as to what the credits that would apply towards payments and obligations, would that be for any obligations that might be due on that particular project or would it be overall taxes or obligations owed by the company to the state. Number 640 REP. GREEN responded that it could be either. Number 644 REP. NORDLUND responded that we are diminishing some of the resources available to the state to encourage companies to drill on private land. Number 647 REP. GREEN responded that that is why it is reduced to twenty-five percent as opposed to fifty percent. This only means that the commissioner has the right to do this. He could go as high as fifty percent, but he never has. Number 664 REP. NORDLUND expressed his concern regarding Natural Resources commissioners having discretion over the credits and whether the commissioner would have the best interests of the state in mind when granting credits. Number 667 REP. GREEN responded that the commissioner must show cause why he would think that this particular case be granted credits. Number 672 KEN BOYD, Deputy Director, Division of Oil and Gas, testified that Representative Green pretty much covered SB 151 and he would respond to questions, if any. He further added that the fifty million was a total over the life of the bill. Number 691 REP. PHILLIPS inquired why there was a ten year sunset in this legislation. Number 700 MR. BOYD responded that the rationale was to try the program and see if it works and whether this type of incentive would lead to increased exploration. Number 711 REP. PHILLIPS inquired about the two year confidentiality provision. Number 713 MR. BOYD responded that right now on state land the confidentiality provision is guaranteed for two years. At the end of that period of time a company can come in and ask for an extension of the confidentiality period. Number 732 REP. PHILLIPS responded that in light of the ten year sunset provision, the two year confidentiality provision was probably okay. Number 736 REP. NORDLUND inquired whether the fiscal note, which is a zero fiscal note that definitely has a fiscal impact, would actually result in a revenue loss to the state. Number 747 CARL MEYER, Income and Excise Division, Department of Revenue, testified that the fiscal note was put together on the basis that it would be difficult to determine what type of credit might be granted. He further stated that there was no way to be absolutely certain what types of credits would be granted. He felt that it would probably be around twenty-five million. So the top would be twenty-five million, but it could in fact be less than that. Number 766 REP. NORDLUND felt that a cost/benefit analysis should be conducted to determine if the state comes out in balance. Number 775 REP. KOTT responded that while there is a cost to the exploration credit, there would be future revenue which would offset or balance out the cost. Number 782 REP. GREEN further responded that even if you select an arbitrary number of wells, that still doesn't mean that there's twenty-five million at which fifty percent is applied. It is still up to the commissioner to grant what he will. Number 789 CHAIRMAN PORTER inquired whether any credit would be given if no oil was found. Number 793. REP. GREEN responded that that was not necessarily true. An oil company could drill a dry hole and still get credit if they have other producing activity. Number 795 REP. PHILLIPS inquired whether the passage of SB 151 would positively further exploration in Alaska. Number 799 REP. GREEN responded yes. This is the kind of legislation that is more valuable to the industry than the number of dollars that are included. It sends a very positive message that the state of Alaska is saying they truly want to compete for industry dollars, along with third world countries, etc. Number 810 REP. NORDLUND again expressed concern over a commissioner granting a credit without having the best interest of the state in mind. He doesn't see this provision in SB 151 and that it would be appropriate to require that in this legislation. Number 820 MR. BOYD responded that it would be very difficult to mandate such a provision. Our current state law has provided a benefit to the state, he said, but it is hard to substantiate it. The benefit to the state is immediate because at the very least the state would gain valuable information as to the mineral content of the land. REP. NORDLUND inquired whether an oil company would drill a well anyway, even without an exploration credit. Number 846 Mr. BOYD responded that there is no way to determine whether they would or not. But without SB 151, if they did, the state would not get the data on the land. Number 853 REP. PHILLIPS informed the committee that during her last national Energy Council meeting, the energy minister for Alberta reported to our body that she had approved nine thousand last year alone and on her desk as of January 1, 1994, she had application permits for ten thousand additional exploratory wells. In the United States 569 permits were offered for wells and in Alaska 11 were offered. She felt SB 151 was bound to help. Number 872 REP. NORDLUND informed the committee he didn't oppose this legislation, but he wanted some of his concerns addressed. Number 878 REP. KOTT motioned that CSSB 151 be moved from committee with individual recommendations and a zero fiscal note. Number 884 CHAIRMAN PORTER, hearing no objection, declared CSSB 151 moved from committee. TAPE 94-51, SIDE B Number 008 HB 367 - CONTROL OF OUTDOOR ADVERTISING REP. JAMES motioned that HB 367 be moved from committee. Number 013 CHAIRMAN PORTER felt there should be discussion on the motion. REP. HARLEY OLBERG, Prime Sponsor of HB 367, testified that HB 367 would allow certain restricted exceptions to the state's limitations on outdoor advertising, thereby addressing the need for improved directional signage to accommodate the state's traveling public. These changes would facilitate efforts by roadside businesses to direct motorists to available services and products. In response to suggestions made by members of committees of both bodies last session, he wanted them to consider CSSB 367 today. CS for HB 367 allows one new exception to the state limitation on outdoor advertising signs, displays and devices. Directional signs could be placed in zoned or unzoned commercial or industrial areas along the state highway subject to stringent restrictions. The draft bill would also codify two existing DOT/PF programs in statute. They are space leasing program and the tourist oriented directional signage program. CS for HB 367 would help many small business owners while not negatively impact the scenery visible from Alaska's highways. He strongly encouraged support for this bill and asked that a committee substitute be drafted, which would be version k. The two changes in the CS are one, page 3, line 6. He said it used to read business adjacent to the highway, and it has been cleaned up to say activities conducted on or abutting the leased property, and the other one on line 20 of page 3, a municipality may regulate directional signs allowed under AS 19.25.105(a)(6) in a way that is more restrictive than AS 19.25.105(a)(6) by an ordinance that is adopted after the effective date of this act. Number 126 REP. NORDLUND inquired what the problem is that necessitates this legislation. Number 129 REP. OLBERG responded that the problem is, along the highway, say between Tok and Glenallen, a mom and pop operation are not allowed to have any sign off of there directing people to their business. This bill would allow them, within fifty miles of their operation, to place a maximum of up to four signs, with directions on them, on private property. This allows for private property placement only. Number 183 REP. PHILLIPS remarked that along the Sterling Highway they have some taxidermists, and he bought a beautiful piece of property along the bluff of Cook Inlet, as well as a house as a museum/workshop for the tourists. He put a beautiful hand crafted wood sign on his property along the highway, and was ordered to remove the sign. The cost to an individual is astronomical as a result of a stupid law. Number 188 REP. NORDLUND expressed a concern that we could end up with a plethora of signs along the highway that would not be very attractive and he wanted to know what sort of limitations are in this legislation to prevent that from occurring. Number 201 REP. OLBERG responded that in his area of the state, the shear lack of private property would be the most effective deterrent. Number 219 REP. PHILLIPS remarked that she is very much in support of this legislation and would encourage all committees to support this legislation. Number 249 CHRYSTAL SMITH, Alaska Municipal League, testified that the Municipal League has no problems with the concept of the bill, but has a problem with the municipalities being able to control the signs within their boundaries. She felt that Representative Olberg's amendment was a back-door approach to solving the problem and she felt that a municipality should not have to open up their sign ordinances again to comply with this legislation. She proposed that the bill be amended at page 3, line 20, stopping after AS 19.25.080 to 19.25.180, which would say that you could enact ordinances that regulate signs that are more restrictive. Number 292 REP. JAMES remarked that in the Interior there are a lot of people who can't find where they are going and she felt the municipality should be just as interested as finding their location. Number 308 MS. SMITH responded that that was true, but the decision needed to be made in the local environment and if a municipality already had a sign ordinance that said x, y, z, that then they shouldn't have to go back into their ordinance because of a change in state law. Number 322 LYNN STANTON testified via teleconference from Seward that she supports the bill as it is presently written. Number 332 CHAIRMAN PORTER inquired as to the applicability of the section relating to municipalities. He asked if what was being said was that a municipality may have a more restrictive sign ordinance if they want. He asked if there was any reason they have to adopt it after enactment of this legislation. Number 339 REP. OLBERG asked, if we exclude the municipalities from the more liberal provisions of this bill, can they then by ordinance take advantage of the exception granted? Number 363 JERRY LUCKHAUPT, Legislative Legal Counsel, Division of Legal Services, Legislative Affairs Agency, testified that what is trying to be attempted here is that we are allowing the municipalities to enact sign ordinances that are anything that they want. They can be more restrictive than the state, they can do whatever they want, except in this area. This new allowance for signs that the legislature is creating is that this is such a new area, no one's been able to enjoinder that and any previous sign ordinance to this that could be out there; they are saying this is something we want everybody to look at, including the municipalities. Any sign ordinances the municipality has enacted prior to this can never have engendered this possibility, because it wasn't out there. It wasn't an option in Alaska. The thought of this language is that if a municipality wants to be more restrictive in this particular area, because they haven't been able to consider this, any previous sign ordinance has not been able to consider this exception that is now there, and thus they would have to adopt a new section, not a new sign ordinance. CHAIRMAN PORTER inquired whether a municipality had in place an ordinance that would preclude, and we are now voiding it and making them revisit it. Number 412 MR. LUCKHAUPT responded yes for this particular statute. Number 415 CHAIRMAN PORTER asked Chrystal Smith if she know of anybody that had this kind of restriction that this would fit under. Number 419 MS. SMITH responded that she was not sure. She reiterated the point that municipalities that have sign ordinances regulate the size and type of sign within their boundaries and should not have to revisit their ordinances as a result of passage of CSHB 367. Number 433 DAVID KAMRATH, Legislative Assistant to Representative Harley Olberg, Prime Sponsor of HB 367, commented that this bill allows for criteria that a business must be at least twenty miles away and that seventy-five percent of the business receipts must come from tourists, so you are not going to have every business in town putting up signs. Another point to be made is that the zoned and unzoned areas along the rural highways, the only thing that is zoned or unzoned is where a business is located and in operation. A business must be there, open, and must contact a property owner down the highway for permission to put a sign on their property. Number 452 MR. LUCKHAUPT remarked that this exception only applies to those areas that are zoned industrial or commercial. This exception of allowing signs would not exist in those residential areas and other zoned areas. Again, it only applies to interstate and primary highways within those municipalities. So it doesn't apply to those roads that are not part of the interstate or primary system of this state. Number 468 CHAIRMAN PORTER remarked that he hopes that doesn't appear to be too adverse to those municipalities. Number 477 REP. KOTT inquired as to what we have on the books at this time that would require those businesses who erected a sign to actually maintain the sign. Number 491 MR. LUCKHAUPT responded that the exceptions and also the existing language for signs in statute require that they be erected and maintained pursuant to DOT's directions. The DOT fights with people all the time about signs. Jeff Otteson from DOT has been testifying on how DOT requires and maintains signs. The DOT has in AS 19.25 dealing with offending signs and how they can be required to be maintained or taken down. REP. PHILLIPS moved the CS for HB 367, version K. CHAIRMAN PORTER, hearing no objection, moved the adoption of CSHB 367, version k. Number 553 REP. NORDLUND inquired what are the DOT requirements for the type, size and lighting. Number 567 MR. LUCKHAUPT responded that you have the requirements that the letters be a specific size relating to the speed limit associated with the road. Also, if the road has a certain amount of traffic on it, the lighting has to be of a certain type. The sign can be reflective, but it can't be reflective to the extent that it could blind certain drivers. Number 584 REP. GREEN inquired whether there was any provision in the bill that would require the mom and pop operation to remove the sign if they closed the establishment. Number 589 Mr. KAMRATH responded that the DOT has the regulation authority to monitor that type of situation. Number 607 MR. LUCKHAUPT responded that Section 19.35.150, existing law, provides that an advertising sign, display or device which violates the provisions of this chapter is a public nuisance and the department is required under that statute to give thirty days notice of an unconforming or illegal sign. That would be a sign that doesn't meet these requirements or isn't maintained. Thus, the DOT can order the removal of the sign, or after thirty days the DOT can remove the sign and charge the cost of removal to the owner of the property. Number 620 REP. KOTT inquired, if this statute were to be implemented, would we see signs like the Marlboro at Harley's bar one mile down the road type of signs. Number 627 MR. LUCKHAUPT responded that we do put requirements on what the signs can advertise, on page 6. It actually has to indicate the specific business and must provide directional information and is limited to those situations. Number 635 REP. OLBERG remarked that the sign must be for an individual business entity that is a significant interest to the traveling public. Number 644 REP. PHILLIPS motioned to move CSHB 367 from committee with individual recommendations and fiscal notes as indicated. CHAIRMAN PORTER, hearing no objections, declared CSHB 367 discharged from committee. The House Judiciary Committee Standing Committee was adjourned at 2:40 p.m.