Legislature(1993 - 1994)

03/02/1993 03:00 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    HOUSE LABOR AND COMMERCE                                   
                       STANDING COMMITTEE                                      
                          March 2, 1993                                        
                            3:00 p.m.                                          
  MEMBERS PRESENT                                                              
  Rep. Bill Hudson, Chairman                                                   
  Rep. Joe Green, Vice Chairman                                                
  Rep. Brian Porter                                                            
  Rep. Joe Sitton                                                              
  MEMBERS ABSENT                                                               
  Rep. Eldon Mulder                                                            
  Rep. Jerry Mackie                                                            
  COMMITTEE CALENDAR                                                           
  *HB 160:  "An act relating to the time for filing certain                    
            civil actions; and providing for an effective                      
            MOVED FROM COMMITTEE                                               
  *HB 112:  "An act relating to limited partnerships; and                      
            providing for an effective date."                                  
            MOVED FROM COMMITTEE                                               
  HB 115:   "An Act extending the termination date of the                      
            Alaska Tourism Marketing Council; and providing                    
            for an effective date."                                            
            CSHB 115(ITT) MOVED OUT OF COMMITTEE                               
  (* First public hearing.)                                                    
  WITNESS REGISTER                                                             
  REP. JOE GREEN                                                               
  Alaska State Legislature                                                     
  State Capitol                                                                
  Juneau, Alaska 99801-1182                                                    
  Position Statement:  Prime Sponsor of HB 160                                 
  RICHARD RITTER                                                               
  American Institute of Architects                                             
  800 Glacier Hwy.                                                             
  Juneau, Alaska 99801                                                         
  Position Statement:  Spoke in support of HB 160                              
  RICHARD CATTANAUGH, Vice President                                           
  Alaska General Contractors                                                   
  8181 Old Seward                                                              
  Anchorage, Alaska 99515                                                      
  Position Statement:  Spoke in support of HB 160                              
  DOUG GREEN                                                                   
  Alaska Professional Design                                                   
  901 W. 29th Ave.                                                             
  Anchorage, Alaska 99503                                                      
  Position Statement:  Testified by way of teleconference in                   
                       support of HB 160                                       
  LEE HOLMES                                                                   
  Alaska Professional Design                                                   
  2522 Arctic #200                                                             
  Anchorage, Alaska 99503                                                      
  Position Statement:  Testified by way of teleconference in                   
                       support of HB 160                                       
  GENE REHFIELD                                                                
  American Society of Civil Engineers                                          
  137 Behrends Avenue                                                          
  Juneau, Alaska 99801                                                         
  Position Statement:  Spoke in support of HB 160                              
  MIKE FORD                                                                    
  Legal Services                                                               
  Department of Law                                                            
  P.O. Box 110300                                                              
  Juneau, Alaska 99811-0300                                                    
  Position Statement:  Commented on HB 160                                     
  ART PETERSON, Attorney                                                       
  Dillon and Findley Law Offices                                               
  One Sealaska Plaza, Suite 202                                                
  Juneau, Alaska 99801                                                         
  Position Statement:  Supported HB 112                                        
  WENDY MULDER, Legislative Liaison                                            
  Department of Commerce and Economic Development                              
  P.O. Box 110800                                                              
  Juneau, Alaska 99811-0800                                                    
  Position Statement:  Commented on HB 115 for the department                  
  PREVIOUS ACTION                                                              
  BILL:  HB 160                                                                
  BILL VERSION:                                                                
  SPONSOR(S): REPRESENTATIVE(S) GREEN,Phillips,Larson,                         
  TITLE: "An Act relating to the time for filing certain civil                 
  actions; and providing for an effective date."                               
  JRN-DATE    JRN-PG                     ACTION                                
  02/17/93       362    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/17/93       362    (H)   LABOR & COMMERCE, JUDICIARY                      
  02/17/93       373    (H)   COSPONSOR(S): VEZEY, MULDER                      
  02/19/93       396    (H)   COSPONSOR CORRECTIONS:PHILLIPS,                  
  02/19/93       397    (H)   HUDSON, PORTER, BUNDE                            
  02/19/93       397    (H)   COSPONSOR(S): KOTT                               
  03/02/93              (H)   L&C AT 03:00 PM CAPITOL 17                       
  BILL:  HB 112                                                                
  BILL VERSION:                                                                
  SPONSOR(S): REPRESENTATIVE(S) MOSES                                          
  TITLE: "An Act relating to limited partnerships; and                         
  providing for an effective date."                                            
  JRN-DATE    JRN-PG                     ACTION                                
  02/01/93       199    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/01/93       199    (H)   LABOR & COMMERCE, JUDICIARY                      
  03/02/93              (H)   L&C AT 03:00 PM CAPITOL 17                       
  BILL:  HB 115                                                                
  SHORT TITLE: EXTEND TOURISM MARKETING COUNCIL                                
  BILL VERSION:                                                                
  SPONSOR(S): LABOR & COMMERCE                                                 
  TITLE: "An Act extending the termination date of the Alaska                  
  Tourism Marketing Council; and providing for an effective                    
  JRN-DATE    JRN-PG                     ACTION                                
  02/03/93       213    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/03/93       213    (H)   TRADE & TOURISM, LABOR & COMM,                   
  02/18/93              (H)   ITT AT 05:00 PM CAPITOL 102                      
  02/18/93              (H)   MINUTE(ITT)                                      
  02/18/93              (H)   MINUTE(TRA)                                      
  02/24/93       442    (H)   STA REFERRAL ADDED,FOLLOWING L&C                 
  02/25/93       453    (H)   ITT RPT  CS(ITT) NEW TITLE  6DP                  
  02/25/93       454    (H)   DP: GREEN, SANDERS, NORDLUND,                    
  02/25/93       454    (H)   DP: TOOHEY, JAMES                                
  02/25/93       454    (H)   -ZERO FISCAL NOTE (DCED) 2/25/93                 
  03/02/93              (H)   L&C AT 03:00 PM CAPITOL 17                       
  03/02/93              (H)   MINUTE(STA)                                      
  ACTION NARRATIVE                                                             
  TAPE 93-17, SIDE A                                                           
  Number 000                                                                   
  CHAIRMAN HUDSON called the House Labor and Commerce                          
  Committee to order at 3:16 p.m. on March 2, 1993.  Members                   
  present were Reps. Hudson, Green, Porter and Sitton.                         
  HB 160: CERTAIN CIVIL ACTIONS                                                
  REP. JOE GREEN, PRIME SPONSOR of HB 160, testified that HB
  160 proposes a "Statute of Repose" for legal action against                  
  design and construction companies.  The statute of repose is                 
  similar to the statute of limitation in other lawsuits.  The                 
  sponsor believes that without a time limit to file legal                     
  actions, design professionals and others in the construction                 
  trade are subject to an indefinite and unfair period of                      
  liability.  Rep. Green further stated that poor maintenance,                 
  improper operation, or alteration of a building can                          
  adversely affect an original structure.  He stated the bill                  
  would not grant immunity, at any time, from injury or damage                 
  as the result of gross negligence.  (See attachment 1)                       
  REP. HUDSON asked for questions from the committee.  There                   
  were no questions from the committee.                                        
  REP. HUDSON called for testimony from Richard Ritter.                        
  Number 108                                                                   
  supported the statements made by Rep. Green and commented                    
  that of the 45 states with a statute of repose, 32 of them                   
  have been adjudged constitutional.  He further elaborated on                 
  the costly burden on a firm when a claim is filed against                    
  them, and provided specific examples.                                        
  Number 120                                                                   
  REP. HUDSON asked for examples of states that do not have a                  
  "statute of repose."                                                         
  Number 125                                                                   
  MR. RITTER responded they were Alaska, Alabama, Wisconsin,                   
  Kentucky and New York.  He also reiterated that 32 of the 45                 
  states with a statute of repose have been tested in court                    
  and were found constitutional.                                               
  Number 172                                                                   
  CONTRACTORS, testified in favor of HB 160, stating that                      
  under current law, contractors have unlimited liability for                  
  any construction project that a company may undertake.  He                   
  said he believes the law is unfair, pointing out that the                    
  statute of limitations for crimes such as vandalism and                      
  murder have shorter statute of limitations.                                  
  MR. CATTANAGH further pointed out that there are many                        
  professionals involved in a construction project and he                      
  feels that it is unreasonable to leave the contractor solely                 
  responsible if a claim is filed.  He recommended that a ten                  
  year statute of repose is too long.                                          
  Number 218                                                                   
  REP. HUDSON asked if Mr. Cattanagh participated in the                       
  rewriting of this issue last year.                                           
  Number 220                                                                   
  MR. CATTANAGH responded no, the contractors had been                         
  excluded from the bill.  As a result, the contractors dealt                  
  with the designing engineers and did not participate in                      
  rewriting or redrafting the bill.                                            
  Number 233                                                                   
  DOUG GREEN testified via teleconference from Anchorage in                    
  support of HB 160.  He pointed out that a building itself is                 
  a process which architects and contractors bring to                          
  completion.  At that time, the owner cares for, maintains,                   
  improves or neglects that building, and at that point the                    
  responsibility is transferred from contractor to owner.                      
  Number 240                                                                   
  MR. GREEN also stated that HB 160 would not protect those                    
  who are negligent or fraudulent within that process.  In                     
  addition, he said, passage of this bill would potentially,                   
  over time, lower insurance rates.                                            
  Number 305                                                                   
  REP. PORTER asked Mr. Green if 10 years was too extreme.                     
  Number 310                                                                   
  MR. GREEN said that some studies show that a lesser length                   
  of time may be justified and would be interested if that                     
  were proposed.                                                               
  Number 319                                                                   
  REP. HUDSON asked what would be a lesser time and what is                    
  the standard in other states.                                                
  Number 323                                                                   
  MR. GREEN said that the standard in most states is five to                   
  eight years.  In previous legislation in the Senate, the                     
  Alaska Professional Design Council supported the seven year                  
  "statute of repose."                                                         
  Number 327                                                                   
  REP. GREEN explained that he was concerned that the shorter                  
  length of time would increase the likelihood of court                        
  intervention and/or if the amount of time was changed in the                 
  bill, it may hinder its passage.  His priority was to pass                   
  the bill from committee and amend it at a later date if that                 
  was deemed a reasonable length of time.                                      
  MR. GREEN agreed.                                                            
  Number 341                                                                   
  LEE HOLMES testified from Anchorage on behalf of the ALASKA                  
  PROFESSIONAL DESIGN COUNCIL in support of HB 160.  He                        
  reiterated comments made by Mr. Green.  He also pointed out                  
  that most claims are filed within 10 years.  If the length                   
  of time is longer than that, it poses a greater financial                    
  and operational burden to the company because of the cost in                 
  locating and maintaining documents.                                          
  Number 403                                                                   
  GENE REHFIELD testified on behalf of the ALASKA SECTION OF                   
  Number 430                                                                   
  REP. HUDSON asked MIKE FORD from LEGAL SERVICES in the                       
  DEPARTMENT OF LAW to come forward.  He asked about the                       
  question of the constitutionality of HB 160 and if this                      
  issue had been before the Labor and Commerce Committee last                  
  year.  He also asked if there was a substantive change in                    
  this bill.                                                                   
  Number 438                                                                   
  MR. FORD stated there were two changes:  HB 160 expands the                  
  group of people protected, and also increases the period of                  
  time that a lawsuit can be brought against a company or                      
  REP. HUDSON asked if the time limit was seven years in last                  
  year's bill.                                                                 
  MR. FORD said there were various versions, seven being the                   
  most popular.  He went on to say, if the committee adopts                    
  the ten year provision, 3 percent of potential litigants                     
  would be excluded.  This is significant in terms of equal                    
  protection analysis and who is being prohibited from                         
  bringing lawsuit.                                                            
  Number 456                                                                   
  REP. PORTER asked Mr. Ford if there was an equal protection                  
  concern regarding who it was protecting by this legislation.                 
  Number 460                                                                   
  MR. FORD said yes, and in addition, contractors had been                     
  added to the list of those protected and felt that was                       
  significant.  He continued to say that there is significance                 
  in the fact that liability laws have changed since the                       
  Scales case and may give the court a different view on this                  
  statute of repose.                                                           
  Number 475                                                                   
  REP. PORTER moved that HB 160 pass out of committee with                     
  individual recommendations and a zero fiscal note.                           
  REP. HUDSON asked for objections.  There were none, so HB
  160 passed from the House Labor and Commerce Committee.                      
  Number 478                                                                   
  CHAIRMAN HUDSON turned the meeting over to VICE CHAIR GREEN.                 
  REP. GREEN announced that HB 112 would be heard next.                        
  HB 112:  UNIFORM LIMITED PARTNERSHIP ACT UPDATE                              
  REP. CARL MOSES, PRIME SPONSOR of HB 112, gave a sponsor                     
  statement. (see attachment 2).  He said the bill would                       
  remove the use of the long form in limited partnerships.                     
  Number 509                                                                   
  ART PETERSON testified in support of HB 112.  He informed                    
  the committee that the long form was no longer necessary and                 
  just does not work under modern use.  He gave a brief                        
  history of the issue and reiterated comments by the sponsor.                 
  Number 560                                                                   
  (It was noted that Rep. Mulder joined the committee at 3:30                  
  Number 563                                                                   
  REP. PORTER asked if the code revision commission committee                  
  had anything to do with revising this law.                                   
  MR. PETERSON responded no and elaborated by noting the                       
  particular professor who made a recommendation was also the                  
  professor who helped the code revision commission on other                   
  REP. PORTER asked if it could be assumed that the majority                   
  of states also have this provision as outlined in HB 112.                    
  MR. PETERSON responded that they do and referenced the fact                  
  sheet in the bill packet. (see attachment 3)                                 
  REP. PORTER asked if this would change the information                       
  available to the public.                                                     
  Number 596                                                                   
  MR. PETERSON responded to Rep. Porter's concern by pointing                  
  out that prospective investors and lenders of credit would                   
  provide any needed information to the other in order to                      
  expedite business transactions in a limited partnership.  He                 
  also pointed out that Section 20 of HB 112 requires the                      
  corporation or organization to maintain all information                      
  requested on the long form.                                                  
  Number 609                                                                   
  REP. MULDER asked if this compared to Senator Rodey's SB 193                 
  of last year.                                                                
  MR. PETERSON said it did; HB 112 would fill in the gap left                  
  by SB 193.                                                                   
  REP. MULDER asked if it was intentionally left out of the                    
  bill last year.                                                              
  MR. PETERSON said it was intentionally left out and was                      
  inadvertently not picked up as Senate relations evolved                      
  during the session.                                                          
  Number 625                                                                   
  REP. SITTON made a motion to move HB 112 from committee with                 
  individual recommendations and a zero fiscal note.                           
  There were no objections, so HB 112 passed from the House                    
  Labor and Commerce Committee.                                                
  CSHB 115(ITT):  "An act deleting a requirement that certain                  
  members of the board of directors of the Alaska Tourism                      
  Marketing Council be substantially involved in a visitor or                  
  recreation industry business; relating to the selection of a                 
  presiding officer for the Alaska Tourism Marketing Council:                  
  and providing for an effective date."                                        
  Number 639                                                                   
  REP. HUDSON gave a brief overview and explained that HB 115                  
  was amended in the House International Tourism and Trade                     
  committee to conform to changes made in the Senate companion                 
  Number 645                                                                   
  REP. HUDSON then expressed the following:  "I must mention                   
  there is some contention in this field as it relates to the                  
  Commissioner of the Department of Commerce and Economic                      
  Development.  He has approached me directly suggesting that                  
  they would like to have the legislation entertain a shift in                 
  the administrative overhead of the Alaska Tourism and                        
  Marketing Council (ATMC) and to essentially do away with the                 
  industries separate administrative escholon and place the                    
  administration of this into the hands of the director of the                 
  Division of Tourism.  What that would do if we adopt this                    
  bill in its current form would potentially put that at odds.                 
  I don't believe we would necessarily have to change this law                 
  in order to permit them to do that, and if that is going to                  
  occur, it will occur at the budgeting end where they                         
  literally take the administrative funds away from the ATMC.                  
  The Finance Committee can modify the management of the ATMC                  
  by simply budgeting the money into the Department of Tourism                 
  rather than into the ATMC."                                                  
  Number 680                                                                   
  REP. HUDSON continued:  "We can do one of two things.  We                    
  can either sit on this or we can pass it and it can be dealt                 
  with in the Finance Committee or State Affairs Committee.                    
  We introduced this legislation in substantially the form                     
  that the industry wants; the industry contributes heavily                    
  towards this whole program here.  As the chairman of this                    
  committee, I suggest that we pass it out and let it be dealt                 
  with ultimately in the Finance committee.  It will be a                      
  policy call that may involve a caucus decision."                             
  Number 780                                                                   
  VICE CHAIRMAN GREEN asked for questions from the committee.                  
  Number 785                                                                   
  REP. PORTER asked if the committee should send a letter of                   
  concern.  Rep. Porter aired a concern about the transferring                 
  of administrative functions.                                                 
  Number 801                                                                   
  In answer to Rep. Porter's question, REP. MULDER said that                   
  there are a number of concerns regarding funding and                         
  administrative functions by and for the tourism industry.                    
  He further speculated on the concern of the commissioner of                  
  the Department of Commerce and Economic Development.                         
  Number 835                                                                   
  COMMERCE, testified on behalf of the commissioner and made                   
  note that the commissioner was unable to join the Labor &                    
  Commerce Committee.  She clarified the concern of the                        
  commissioner by saying that the commissioner wanted the                      
  committee to know that it was a budgetary matter and felt                    
  that the committee should be aware of that.  She further                     
  stated that the department is willing to go any direction                    
  the legislature wishes the ATMC or the Division of Tourism                   
  to go.                                                                       
  Number 864                                                                   
  REP. GREEN asked if funding was the driving force behind                     
  what happens with the ATMC.  He asked if it would create                     
  confusion, and shouldn't there be an established place for                   
  Number 867                                                                   
  MS. MULDER explained that for budgetary reasons they would                   
  bring the staff of the ATMC back into the Division of                        
  Tourism.  The ATMC would still have voting power over the                    
  contracts, but administratively it would be handled in the                   
  Division of Tourism.                                                         
  Number 900                                                                   
  REP. HUDSON explained that because of the above stated                       
  reasons, this bill should be moved on to the Finance                         
  Number 906                                                                   
  REP. PORTER aired a concern regarding the moving of                          
  administrative functions of the ATMC to the Division of                      
  Tourism.  He further stated that he did not think that was a                 
  good idea.                                                                   
  Number 926                                                                   
  testified in support of HB 112.                                              
  Number 937                                                                   
  REP. MULDER moved and asked unanimous consent that CSHB
  112(ITT) move from committee with individual recommendations                 
  and a zero fiscal note.  There being no objections, it was                   
  so ordered.                                                                  
  VICE CHAIRMAN GREEN adjourned the House Labor & Commerce                     
  Committee meeting at 4:16 p.m.                                               

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