Legislature(2001 - 2002)
04/10/2002 03:32 PM House L&C
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
April 10, 2002
3:32 p.m.
MEMBERS PRESENT
Representative Lisa Murkowski, Chair
Representative Andrew Halcro, Vice Chair
Representative Kevin Meyer
Representative Pete Kott
Representative Norman Rokeberg
Representative Harry Crawford
Representative Joe Hayes
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 269
"An Act establishing employment protections for certain
employees in the aviation industry relating to safety issues."
- HEARD AND HELD
HOUSE BILL NO. 271
"An Act relating to recovery of punitive damages resulting from
an aviation accident; and providing for an effective date."
- MOVED CSHB 271(L&C) OUT OF COMMITTEE
HOUSE BILL NO. 429
"An Act relating to certain licenses for the sale of tobacco
products; relating to tobacco taxes and sales and cigarette tax
stamps; relating to provisions making certain cigarettes
contraband and subject to seizure and forfeiture; relating to
certain crimes, penalties, and interest concerning tobacco taxes
and sales; relating to notification regarding a cigarette
manufacturer's noncompliance with the tobacco product Master
Settlement Agreement or related statutory provisions and to
confiscation of the affected cigarettes; and providing for an
effective date."
- HEARD AND HELD
PREVIOUS ACTION
BILL: HB 269
SHORT TITLE:JOB PROTECTION FOR EMPLOYEES IN AVIATION
SPONSOR(S): LABOR & COMMERCE
Jrn-Date Jrn-Page Action
05/04/01 1532 (H) READ THE FIRST TIME -
REFERRALS
05/04/01 1532 (H) L&C, JUD
05/04/01 1532 (H) REFERRED TO LABOR & COMMERCE
05/06/01 1617 (H) PRIME SPONSOR CHANGED
04/10/02 (H) L&C AT 3:15 PM CAPITOL 17
BILL: HB 271
SHORT TITLE:CAP ON AVIATION ACCIDENT PUNITIVE DAMAGES
SPONSOR(S): LABOR & COMMERCE
Jrn-Date Jrn-Page Action
05/04/01 1532 (H) READ THE FIRST TIME -
REFERRALS
05/04/01 1532 (H) L&C, JUD
05/06/01 1617 (H) PRIME SPONSOR CHANGED
04/10/02 (H) L&C AT 3:15 PM CAPITOL 17
BILL: HB 429
SHORT TITLE:TOBACCO TAXATION; LICENSING
SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR
Jrn-Date Jrn-Page Action
02/15/02 2282 (H) READ THE FIRST TIME -
REFERRALS
02/15/02 2282 (H) L&C, JUD, FIN
02/15/02 2282 (H) FN1: (REV)
02/15/02 2282 (H) GOVERNOR'S TRANSMITTAL LETTER
04/03/02 (H) L&C AT 3:15 PM CAPITOL 17
04/03/02 (H) Heard & Held
04/03/02 (H) MINUTE(L&C)
04/08/02 (H) L&C AT 3:15 PM CAPITOL 17
04/08/02 (H) Scheduled But Not Heard
04/10/02 (H) L&C AT 3:15 PM CAPITOL 17
WITNESS REGISTER
CHRIS KNIGHT, Staff
to Representative Andrew Halcro
Alaska State Legislature
Capitol Building, Room 414
Juneau, Alaska 99801
POSITION STATEMENT: Presented HB 269 and HB 271 on behalf of
the sponsor, the House Labor and Commerce Standing Committee.
FRED CIARLO, General Manger
Tanana Air Service
PO Box 60713
Fairbanks, Alaska 99706
POSITION STATEMENT: Discussed the costs of aviation insurance.
MIKE SALAZAR
PO Box 6918
Ketchikan, Alaska
POSITION STATEMENT: Testified that anything that can be done to
limit the awards of settlements in aviation cases will reduce
the costs to travelers.
BOB JACOBSEN
Wings of Alaska
8421 Livingston Way
Juneau, Alaska
POSITION STATEMENT: Discussed the rise in aviation insurance
rates.
KIP KNUDSON, President
Alaska Air Carriers Association
929 E. 81st, Number 108
Anchorage, Alaska 99518
POSITION STATEMENT: Testified that HB 271 is a good start.
With regard to HB 269, the association is neutral.
MIKE ONEIL (PH), Owner
Security Aviation
3600 W. International Airport Road
Anchorage, Alaska
POSITION STATEMENT: Discussed difficulties with rising aviation
insurance rates.
JOHN STEINER, Assistant Attorney General
Transportation Section
Civil Division (Anchorage)
Department of Law
1031 W 4th Avenue, Suite 200
Anchorage, Alaska 99501-1994
POSITION STATEMENT: Expressed concerns with HB 269.
RICHARD HARDING, Vice President
Peninsula Airways
(No address provided)
POSITION STATEMENT: Discussed reasons for rising aviation
insurance costs.
MIKE ELERDING
Northern Sales Company
PO Box 8112
Ketchikan, Alaska
POSITION STATEMENT: Provided written comments and noted support
of an amendment to HB 429 included in the committee packet.
ACTION NARRATIVE
TAPE 02-54, SIDE A
Number 0001
CHAIR LISA MURKOWSKI called the House Labor and Commerce
Standing Committee meeting to order at 3:32 p.m.
Representatives Halcro, Meyer, Crawford, and Hayes were present
at the call to order. Representatives Murkowski, Kott, and
Rokeberg arrived as the meeting was in progress.
HB 269-JOB PROTECTION FOR EMPLOYEES IN AVIATION
HB 271-CAP ON AVIATION ACCIDENT PUNITIVE DAMAGES
VICE CHAIR HALCRO announced that the first order of business
would be HOUSE BILL NO. 269, "An Act establishing employment
protections for certain employees in the aviation industry
relating to safety issues." and HOUSE BILL NO. 271, "An Act
relating to recovery of punitive damages resulting from an
aviation accident; and providing for an effective date."
VICE CHAIR HALCRO reminded the committee that last year there
was a subcommittee on aviation in Alaska. The subcommittee,
chaired by Representative Halcro, put forth three
recommendations. There was a recommendation for training and
education which [led to] substantial investment in programs such
as the Medallion Program and the Cap Stone Program at the
University of Alaska. The second recommendation was employee
protection, which is encompassed in HB 269. The third
recommendation was for tort reform for aviation accidents, which
is encompassed in HB 271. House Bill 271 limits punitive damage
awards.
Number 0226
CHRIS KNIGHT, Staff to Representative Andrew Halcro, Alaska
State Legislature, presented HB 269 and HB 271 on behalf of the
sponsor, the House Labor and Commerce Standing Committee. Mr.
Knight explained that HB 269 inserts "whistle-blower" protection
privileges into the current aviation statutes. Therefore, an
employee of an aviation company has certain protections when
working for that company. So an individual who talks about
certain safety practices, for example, would be protected under
HB 269 with [regard to the retention of their job]. Mr. Knight
said that 99.9 percent of the aviation businesses in Alaska
operate good businesses. He noted that HB 269 mirrors some
existing statutes on whistler-blower protection.
MR. KNIGHT turned to HB 271, which addresses punitive damages.
He mentioned the difficulty in obtaining hard data with regard
to how many punitive damages relating to aviation accidents have
been awarded in Alaska. This legislation limits the punitive
damage portion of litigation involving aviation accidents that
go to court. This legislation does not limit, in any way, the
compensatory damages. House Bill 271 is important in this
package for aviation because typically a lawyer enters into
settlement cases and although the lawyer will never move through
the processes to seek punitive damages, the lawyer will threaten
to do so in order to boost settlement costs or compensatory
damages.
MR. KNIGHT said that the main reason for this all is that
insurance rates [for aviation] are going through the roof. In
some cases, insurance rates have tripled and quadrupled. He
pointed out that the committee packets should include a document
from the Division of Insurance, which discusses the direct
losses incurred over the last ten years. With regard to the
direct losses, Alaska has increased by 141 percent over ten
years. This legislation, HB 271, is aimed at allowing insurance
companies to get a handle on their overall costs, which then
allows the insurance companies to [adjust] their rates.
Therefore, it would benefit the air carriers.
MR. KNIGHT concluded by noting that he has had little
communication with the insurance companies. All the impetus for
these bills has come from the air carriers.
Number 0517
REPRESENTATIVE CRAWFORD inquired as to what was used to
established the punitive damages limits in HB 271.
MR. KNIGHT answered that the limits were based on what the
current policyholders have with regard to compensatory damages.
He informed the committee that in 1997 legislation was enacted
that established limits for punitive damages that allowed three
times the compensatory rate or $5,000, whichever is higher. In
the aviation industry, the compensatory awards are often upwards
of $1 million. Therefore, under the current tort reform laws
there could be punitive damage awards upwards of $3 million.
The limits in HB 271 seem to be fair while allowing the
insurance companies to obtain a grasp on their marketable risk.
With regard to punitive damages sought by an attorney, it's hard
to prove the egregious act was knowingly performed with no
regard to safety mechanisms or hazards and that those business
practices continued and thus endangered the clients or other
people. He reiterated that in 99 percent of the cases that are
settled, the lawyers seeking compensatory damages use punitive
damages as a threat in order to drive up the costs of
compensatory damages. Mr. Knight said that the committee
packet should include research that specifies that there have
been eight punitive damage awards in the last two years, four of
which were between $15,000-$100,000. Of the other four awards
that were higher than $100,000, the three highest awards were
$2.6 million to $150 million.
Number 0768
REPRESENTATIVE CRAWFORD related his understanding of Mr.
Knight's testimony that under current tort reform, the upper
limit [for punitive damages] would be $3 million. However, [the
research] specifies that there was a judgment for $150 million.
MR. KNIGHT said that there are certain ways around the [tort
reform limitations for punitive damages]. He explained that
tort reform for punitive damages allows three times the limit
[specified for] compensatory [damages] or $5,000, whichever is
higher. Therefore, placing a cap on punitive damages seems to
allow the insurance companies and air carriers to have a "fix"
on how much their rates can expand.
VICE CHAIR HALCRO noted that both HB 269 and HB 271 were
introduced last May and in the last three months there have been
a number of newspaper articles on these subjects.
Number 0967
FRED CIARLO, General Manger, Tanana Air Service, informed the
committee that two years ago Tanana Air Service was listed as
the ninth largest passenger carrier for rural Alaska. Tanana
Air Service operates out of 86 different villages in the
Interior. Insurance is one of the major costs and anything that
can be done to reduce that cost would be appreciated. Mr.
Ciarlo explained that last year Tanana Air Service was quoted
$3,000 per seat to insure an airplane. Therefore, 50 seats
would equate to $150,000. Those costs are [borne by the
consumer] at a rate of $15-$20 a ticket. This year Tanana Air
Service faces a 20 percent increase in insurance. Mr. Ciarlo
informed the committee that last year he reduced the number of
seats by 13 and didn't insure those seats. Furthermore,
passenger service out of Bethel was eliminated because of
insurance and the high cost of jury-awarded settlements. Mr.
Ciarlo related that if there is an accident and someone dies, he
could expect to lose the company. He noted that safety has been
increased through the aforementioned Medallion Program.
"Anything that we can do to limit the awards of settlements will
reduce the costs to the air constituents in traveling and we
appreciate those efforts," he said.
The committee took a brief at-ease and the gavel was returned to
Chair Murkowski.
MIKE SALAZAR testified on his own behalf, but noted that he
works for Accordion Northwest out of Seattle, Washington. Mr.
Salazar informed the committee that he was in the aviation
business for over 30 years in Ketchikan. He said that this
legislation won't chase any insurance companies out of Alaska
but rather will help. Most of the underwriters that he spoke
with felt that obtaining a cap on what they will have to pay out
results in establishing better rates under which the operators
can work. With regard to punitive damages, Mr. Salazar pointed
out that many insurance policies don't cover punitive damages or
there are questions with regard to whether they do or don't.
Therefore, the carrier has to hire an attorney in order to
ensure that the carrier is protected.
MR. SALAZAR informed the committee that certified air carriers
are only required to carry $150,000 of insurance per seat. A
401 certified air carrier, which means that the aircraft hauls
the mail on a scheduled basis through the Federal Aviation
Administration (FAA) and the Department of Transportation (DOT),
[is required to carry] a minimum of $300,000 worth of insurance.
Basically, each company bets its net worth when it flies. In
conclusion, Mr. Salazar related his belief that what the
committee is doing is good.
Number 1252
REPRESENTATIVE HALCRO recalled the Haglen (ph) Aviation case in
which the judge ruled that punitive damages weren't covered in
the [business] per person limit. Hopefully, passage of this
legislation [HB 271] would define a businesses exposure. He
requested Mr. Salazar discuss how this legislation would help
underwriters get a better grip on the total exposure in order to
establish rates.
MR. SALAZAR answered that if a person sues for punitive damages,
the aviation business has to provide a defense. He noted that
one result could be the charge that punitive damages are
excluded from the policy. However, without review of each
policy he couldn't say.
CHAIR MURKOWSKI related that she had read in the February
Journal Commerce that the percentage increase in insurance can
be anywhere from 20-200 percent.
MR. SALAZAR agreed and pointed out that the largest problem is
getting the proper coverage for the air carrier.
Number 1390
BOB JACOBSEN, Wings of Alaska, informed the committee that from
1989-1994 Wings of Alaska paid about $150,000 for its annual
insurance policy for 120-130 seats. In 1995 the cost went to
about $250,000. In 1996-1999 the insurance costs for Wings of
Alaska were about $350,000, which increased to about $700,000 in
2000 and last year it rose to about $850,000. He pointed out
that during 1989-1994 Wings of Alaska had "smooth policy
limits". He explained that a $10-$20 million policy didn't have
any per passenger sub-limit. However, underwriters don't like
smooth policy limits because they feel too exposed and
underwriters have spent a lot due to the current liberal juries.
Therefore, the [per passenger] sub-limit came into play. Mr.
Jacobsen informed the committee that this year Wings of Alaska
will pay about the same price as last for $250,000 a seat, which
is all the company could afford. He explained that in the last
few years Wings of Alaska has been purchasing the most insurance
that it could afford. What is happening is that good carriers
are being put out on a limb. Mr. Jacobsen noted his
appreciation of the committee's efforts with HB 271, which he
characterized as a start. Although HB 271 doesn't go far
enough, he expressed hope that it would be the first step in
more meaningful tort reform while work in the area of training
and safety continues.
Number 1585
CHAIR MURKOWSKI turned to the spike in Wings of Alaska's rate
between 1999 and 2000 and asked if that was due to an accident
or was that merely the market.
MR. JACOBSEN answered that it was reflective of what was
happening in the market. He informed the committee that in the
last two years during which Wings of Alaska faced these large
increases, it has not had one claim. He related that in those
years some underwriters were lost; there has been consolidation
in the worldwide aviation underwriting market. Furthermore, the
State of Alaska has lost some underwriters due to the Haglen
(ph) accidents. Also, there was a [more recent] case in which
the people on the ground who witnessed their relatives in an
accident and went after the third-party liabilities. A judge
found in favor of the plaintiffs, which cost the underwriters
well beyond their policy limits on the per sub-passenger basis.
He mentioned that much of what is happening this year is related
to the September 11th tragedy. He also mentioned that this
increase in insurance rates is now happening to [larger carriers
outside of Alaska] such as with United Airlines and Alaska
Airlines. Perhaps this will all plateau or decrease a bit over
the coming years, although he predicted rates won't decrease
that much in Alaska.
Number 1698
KIP KNUDSON, President, Alaska Air Carriers Association,
characterized the issues being discussed today as discussions of
Alaska's transportation infrastructure in rural Alaska. He
explained that Alaska has an odd public:private agreement. That
is, private companies do most of the hauling and the public
entities provide spaces for the air craft to land and handle the
passengers. As mentioned earlier, carriers are moving out of
the passenger-carrying business in droves. However, "you
haven't seen nothing yet," he said. For almost every carrier in
the state the next "re-up" for insurance will happen in the next
six months and the increases that were discussed by Mr. Jacobsen
will be felt by those who have yet to experience them. He
predicted that those companies will either pull out of the
passenger business or go out of business completely. Therefore,
the conundrum becomes how the state provides adequate
transportation to those in rural Alaska. However, he questioned
whether the current situation, with the limits that are being
carried, provides adequate transportation.
MR. KNUDSON turned to the legislation before the committee.
With regard to HB 271, the Alaska Air Carriers Association takes
the position that it's a good start, although the association
would probably prefer an elimination of punitive damages for
aviation incidents. In reference to HB 269, the association
isn't opposed to any whistle-blower protection, although the
association believes that there is probably ample protection now
either through the FAA or state law. Since none of the members
of the association see HB 269 as an issue, the association is
neutral on it.
Number 1827
CHAIR MURKOWSKI turned to HB 269 and suggested that rather than
flagrant safety violations there would be subtle economic
pressure. For instance, [the economic pressure could result in]
taking a flight of paying passengers sight seeing in less than
optimal weather. She said she believes there would be more of
that type of [infraction reported by a whistle blower] rather
than scrimping on the maintenance of the aircraft. However,
with the economics of insurance coming into play the deferred
maintenance may increase, she commented.
MR. KNUDSON informed the committee that the air carrier for
which he works, Era Aviation, is overseen by up to eight FAA
inspectors designated to Era Aviation alone. The oversight in
Alaska is quite adequate, he remarked. Under the FAA
regulations it has become very difficult, in a good way, to be a
passenger carrier in Alaska. Furthermore, the industry itself
is establishing higher standards for maintenance. Mr. Knudson
reiterated that none of the Alaska Air Carriers Association
members see whistle-blower protection as an issue and thus the
association doesn't oppose HB 269.
Number 1932
MIKE ONEIL (PH), Owner, Security Aviation, testified via
teleconference. He informed the committee that Security
Aviation consists of five aircraft [with a total] of 37
passenger seats which amounts to an approximate value of $5.9
million. Security Aviation has been in business for 17 years
and has been accident free for that time. Mr. Oneil noted that
he has extremely high standards for pilot recruitment. The
pilots log 10,000-35,000 hours of flight time in Alaska. Mr.
Oneil informed the committee that he is currently paying
$750,000 a year [for insurance]. He noted that although he has
slightly higher limits than most similar air taxis, it isn't
sufficient to make him comfortable because one accident could
result in the loss of [his business]. Mr. Oneil expressed
frustration with the way the insurance industry places everyone
with an Alaskan address in [a high rate category]. For example,
he pays an insurance rate about 40 times higher than an operator
of similar size out of Seattle, Las Vegas, or Key West. Mr.
Oneil noted that two days worth of operations pay for the
insurance premiums for minimal coverage.
MR. ONEIL expressed the hope that he would never come to the
point of flying into locations that aren't [optimal weather
wise] in order to pay for insurance. He informed the committee
that [due to increased insurance rates] some operators will
decrease the number of pilots while increasing the hours of
flying time for those pilots. The same situation can occur in
regard to maintenance. All of these things create more exposure
for the insurance companies. Although Mr. Oneil said that he
didn't have a solution, he did note that the insurance companies
can't be leaned on because they have no obligation to do
business in Alaska. He offered the suggestion of the state
providing a pool similar to that provided for workers'
compensation. With regard to the number of carriers leaving the
business, Mr. Oneil informed the committee that a senior FAA
inspector told him that the Anchorage office has had 23 "135
certificates" turned in since the September 11th tragedy.
Number 2173
JOHN STEINER, Assistant Attorney General, Transportation
Section, Civil Division (Anchorage), Department of Law,
testified via teleconference. He noted that the Department of
Law and the administration has not taken a formal position on HB
269. Mr. Steiner related that the provisions of HB 269 would
seem to reasonably alleviate potential concerns of an employee
in the aviation industry [when performing a task differently
than the employer specified for a reason related to aviation
safety]. However, he acknowledged Mr. Knudson's comments that
the aviation industry doesn't seem to have a problem and said
that he had no reason to dispute that.
MR. STEINER said that although he didn't see any legal problem
with the purpose of HB 269, he did have some questions with
regard to specific language. Although HB 269 has been described
as a whistle-blower provision, the legislation really doesn't
speak to whistle blowing in the traditional sense which is
reporting something to an oversight industry. Rather, the
legislation deals with an employee taking conduct on their own
or declining to take contact, which is a bit different than the
traditional thinking. The bill appears to cover all employees
of an employer in the aviation industry, which is a defined
term. It appears that the employee is covered even if the
employee has nothing to do with aviation itself. Therefore,
this legislation would arguably apply to all state employees
because the state troopers, fish and game, and the Air National
Guard operate aircraft. With such a definition, the legislation
appears to apply to those employees who don't even have aviation
jobs, but may be inclined to perform a task differently than
directed on the basis that some safety-related aviation issue
was involved. If the intent of the protection is to apply to
workers in the aviation industry, the bill could be a bit more
clear on that point. Furthermore, the concept of the safety-
related aviation issue isn't defined in the legislation nor is
the employee's relation in the action or inaction and the
safety-related issue. Although the legislation only protects
action or inaction that was performed in good faith, it appears
to make no difference whether the conduct is reasonable or
whether the good faith is based on reasonably relevant or
reliable information or reasonably sound judgment. Furthermore,
the legislation doesn't seem to be limited to situations in
which the employee reasonably believes that doing what he/she
was instructed to do would materially compromise safety. Mr.
Steiner stated that the aforementioned factors may make
enforcement more difficult and may preclude employers from
dealing with unreasonable conduct or poor judgment of an
employee claiming their conduct was based on an existing safety
issue.
MR. STEINER pointed out that the legislation also doesn't
indicate that employees who decline or fail to carry out
directions or perform differently than expected must report that
to the employer. Therefore, it seems that it could pose a risk
to safety if an employee is freed from responsibility of their
conduct but is not required to report to the employer that
he/she didn't do what he/she was supposed to do. This could
lead to the employer being unable to account for the
accomplishments of tasks with predictability.
TAPE 02-54, SIDE B
MR. STEINER, speaking from an employer's responsibility,
specified that there may be the need to change the language a
bit in order to ensure that it's not overly broad.
Number 2362
MR. STEINER pointed out that the Department of Law submitted an
indeterminate fiscal note because it can't predict the cost of
prosecuting enforcement of the civil fine provision against
employers due to the lack of knowledge with regard to how many
such cases there will be. Furthermore, the Department of Law
can't predict the cost of defending claims that might be brought
by a state employee. Moreover, the department can't predict
whether this legislation would change the behavior of state
employees on the basis of safety-related aviation issues that
would pose additional costs on other departments. Mr. Steiner
pointed out that one of the provisions of HB 269 is that
employers would be required to inform employees of these
protections, which could result in some abuse.
REPRESENTATIVE HALCRO suggested that perhaps a committee
substitute could be drafted to more clearly define the intent of
HB 269.
Number 2279
RICHARD HARDING, Vice President, Peninsula Airways, informed the
committee that he has flown in the state for 32 years and has
seen many changes, particularly in recent years. In the past
few years, passenger carriers have moved to cargo carriers only
because of insurance costs. The problem has become so bad that
U.S. Senator Ted Stevens has [introduced] legislation in
Washington, D.C., to address the problem. The congressional
legislation once again ties bypass mail to passenger carrying;
if a carrier doesn't carry passengers, then it can't carry
bypass mail. However, the root of the problem with carriers
leaving passenger travel is the insurance costs. He specified
that there are two reasons why aviation insurance rates are
expensive in Alaska. One of the reasons is Alaska's high
accident rate, which the Alaska Air Carriers Association is
working on via the Medallion Program. The other reason for
expensive aviation insurance rates in Alaska is because Alaska
is ranked the second worst state for jury awards. He indicated
that most aviation cases in Alaska are settled outside of court
because of the fear with regard to what would happen in court.
He noted his desire to not see any punitive damages. However,
having caps on noneconomic and punitive [damages] would allow
cases to be settled in months rather than years.
Number 2061
REPRESENTATIVE ROKEBERG asked if the Medallion Program is
recognized by the FAA.
MR. HARDING replied yes and noted that the FAA actually issues
the medallion. After a year of [successful] operation under the
Medallion Program, the operator is considered a medallion
carrier. He noted that there have been commitments from the
FAA, the Department of Transportation & Public Facilities, and
school districts to market the Medallion Program and require
their employees to fly on Medallion Program carriers. He
predicted that after a few carriers operate under this program,
others will want to join as well. He also predicted that once
carriers operate at a higher standard under the Medallion
Program, the number of accidents will be reduced. A reduction
in accidents will result in a decrease in insurance premiums, he
predicted.
REPRESENTATIVE ROKEBERG asked if it would be fair to create a
connection between those who qualify for the Medallion Program
and the level of the caps. He viewed it as an incentive.
MR. HARDING indicated it was a good idea, but didn't know about
the mechanics of it.
REPRESENTATIVE ROKEBERG noted that there may be some question
with regard to the legal application of creating a connection
between those who qualify for the Medallion Program and the
level of the caps.
REPRESENTATIVE HALCRO requested that HB 269 be held in committee
and HB 271 forwarded to the next committee of referral, the
House Judiciary Standing Committee. He noted that conversations
with rural legislators have [indicated] their support of this.
Number 1936
REPRESENTATIVE HALCRO moved to report HB 271 out of committee
with individual recommendations and the accompanying zero fiscal
note.
REPRESENTATIVE MEYER objected. He asked if there is a
definition of employee. He noted concern with regard to the
situation in which businesses use contractors versus employers.
MR. KNIGHT directed the committee to paragraph (2) on page 2 of
HB 271 and informed the committee that this bill was drafted to
reflect the current statute for tort reform. The current
statute discussed the number of employees per company.
Therefore, the drafter modeled the legislation after current
statute and some aviation items. Due to the size, only a few
companies would be applicable to the third category. If there
is a way to categorize the size of a company differently, he was
sure that Representative Halcro would be open to suggestions.
REPRESENTATIVE MEYER clarified that his question is in relation
to page 2, line 10, subsection (c). He pointed out that Alaska
Airlines may have less than 200 employees in the state while
having many out of state employees and others who are
contractors. Perhaps this issue could be reviewed in the House
Judiciary Standing Committee.
MR. KNIGHT said he would look into it.
REPRESENTATIVE MEYER related his understanding that the intent
is that the larger the carrier, the more the carrier could pay.
However, some of the larger carriers may have [the majority] of
their employees located in another state.
CHAIR MURKOWSKI suggested that Representative Meyer speak with
Representative Halcro between now and when this legislation is
heard in the House Judiciary Standing Committee.
REPRESENTATIVE MEYER pointed out that this legislation has an
effective date of July 1, 2001.
REPRESENTATIVE HALCRO withdrew his motion to report the bill
from committee.
Number 1752
REPRESENTATIVE MEYER moved that the committee adopt the
following amendment, Amendment 1:
Page 2, line 16,
Delete "July 1, 2001"
Insert "July 1, 2002"
There being no objection, the amendment was adopted.
Number 1722
REPRESENTATIVE HALCRO moved to report HB 271 as amended out of
committee with individual recommendations and the accompanying
zero fiscal note. There being no objection, CSHB 271(L&C) was
reported from the House Labor and Commerce Standing Committee.
[HB 269 was held over.]
HB 429-TOBACCO TAXATION; LICENSING
CHAIR MURKOWSKI turned to the final order of business HOUSE BILL
NO. 429, "An Act relating to certain licenses for the sale of
tobacco products; relating to tobacco taxes and sales and
cigarette tax stamps; relating to provisions making certain
cigarettes contraband and subject to seizure and forfeiture;
relating to certain crimes, penalties, and interest concerning
tobacco taxes and sales; relating to notification regarding a
cigarette manufacturer's noncompliance with the tobacco product
Master Settlement Agreement or related statutory provisions and
to confiscation of the affected cigarettes; and providing for an
effective date."
CHAIR MURKOWSKI informed the committee that members should have
received an amendment. She acknowledged that Mr. Elerding had
flown to Juneau to address the amendment. She noted that the
committee packet does include his previous written testimony.
She offered to let Mr. Elerding testify, although the bill would
not be taken up today.
MIKE ELERDING, Northern Sales Company, said that he would submit
his written comments. He announced that he is in favor of the
proposed amendment.
CHAIR MURKOWSKI announced that HB 429 would be heard on Monday
[April 15th].
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
4:40 p.m.
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