Legislature(1995 - 1996)
02/20/1995 03:05 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE LABOR & COMMERCE STANDING COMMITTEE February 20, 1995 3:05 p.m. MEMBERS PRESENT Representative Pete Kott, Chairman Representative Norman Rokeberg, Vice Chairman Representative Jerry Sanders Representative Beverly Masek Representative Kim Elton Representative Gene Kubina Representative Brian Porter MEMBERS ABSENT All Members Present COMMITTEE CALENDAR Confirmation Hearing: William L. Hensley, Department of Commerce. Confirmation Hearing: Tom Cashen, Department of Labor. WITNESS REGISTER WILLIAM L. HENSLEY, COMMISSIONER-DESIGNEE Department of Commerce and Economic Development State Office Building, 9th Floor P.O. Box 110800 Juneau, AK 99802-0800 Telephone (907) 465-5442 POSITION STATEMENT: Testified regarding his confirmation. TOM CASHEN, COMMISSIONER-DESIGNEE Department of Labor 1111 W 8th Street P.O. Box 21149 Juneau, AK 99802-1149 Telephone (907) 465-2700 POSITION STATEMENT: Testified regarding his confirmation. REBECCA NANCE, DIRECTOR Employment Security Division Department of Labor 1111 W. 8th Street P.O Box 25509 Juneau, AK 99802-1149 Telephone (907) 465-2711 POSITION STATEMENT: Gave information regarding the Department of Labor, Empoyment Security Division's computer system. ACTION NARRATIVE TAPE 95-7, SIDE A Number 000 The House Labor and Commerce Standing Committee was called to order by Chairman Pete Kott at 3:05 p.m. Members present at the call to order were Representatives Kott, Rokeberg, Sanders, Masek, Kubina and Elton. Representative Porter was absent. CHAIRMAN PETE KOTT stated there was a quorum present. He noted that on today's agenda were confirmation hearings for Commissioner Designee William (Willie) Hensley to the Department of Commerce and Economic Development and Commissioner Designee Tom Cashen to the Department of Labor. He stated that Commissioner Hensley was standing by on teleconference from Anchorage. Number 022 CHAIRMAN KOTT pointed out that this hearing was going to be much like a job interview and asked Commissioner Hensley to start off by telling the committee why he should be confirmed as Commissioner of the Department of Commerce. He added that the committee had a copy of his resume. Number 039 COMMISSIONER-DESIGNEE WILLIE HENSLEY, Department of Commerce and Economic Development testified via teleconference that he was invited to be commissioner by the Governor after the election. He explained that over the past 20 years he had been engaged in business in one form or another, such as with his former job with NANA Corporation. He explained one of the reasons he enjoyed this department was that it covered a wide spectrum of economic development in tourism, trade, forestry, and in the regulatory functions of Alaska's commerce. He talked of a sewage treatment plant project in Prudhoe Bay he was involved in, and he noted that it was a partnership between the state, the oil industry, the North Slope Borough, and Nana Corporation. He explained that later he got involved in tourism with his hotel in Kotzebue, and in Prudhoe Bay. He discussed providing tours for people coming up the highway or flying in. He talked of operating three bulk fuel storage facilities in three of the villages, and the difficulties of engaging in that type of enterprise with all the new environmental laws. COMMISSIONER HENSLEY spoke of his experiences contracting to service companies along the pipeline in providing food and janitorial services. He also talked of bidding on some tracts in the Beaufort Sea some 20 years ago. He discussed the initial investments to the permitting process in development off shore. Commissioner Hensley then spoke of the Red Dog Mine project, which was a ten year effort from idea to completion and operation. He spoke of the major hurtles with financing, the environment and local hire issues. Commissioner Hensley concluded that it was because of these experiences that Governor Knowles felt he would be the best choice for the job. Number 133 REPRESENTATIVE GENE KUBINA stated that Alaska is fortunate to have someone with Commissioner Hensley's experience to work for the government. He commented on the sacrifices people make, with respect to family, life and friends, by accepting these positions. He thanked Commissioner Hensley for accepting the position and stated that he looks forward to working with him in the coming years. Number 148 VICE CHAIRMAN NORMAN ROKEBERG stated that he would support Commissioner Hensley's confirmation; however, he wanted to confirm that the Commissioner had no more legal problems relating to the United Bank of Alaska's failure. Number 165 COMMISSIONER HENSLEY stated that was entirely behind him. He stated that he was very proud to have been one of the founder's of the bank. At that time, he explained, it was very difficult to get loans outside of the urban areas. Many of the bankers weren't aware of the potential. Commissioner Hensley stated that most of the enterprises he has been involved with were successful. Unfortunately, he stated, that one wasn't. Number 190 CHAIRMAN KOTT asked Commissioner Hensley to address what he hoped to accomplish with tourism over the next four years, in promoting Alaska. Number 204 COMMISSIONER HENSLEY stated that one of the reasons he was in Anchorage was to get a better feel for where the departments at. Tourism, he stated, was an area of great potential. He talked of how his community is at the tail end of the great tourist migration into the state, and how it only gets seven to ten thousand tourists over a season, however, he stated that keeps a lot of people working. He stated that he would like to see not only an increase in the number of tourists, but also increases in the length of the tourist season. He talked of working with businesses and communities that are off the "main trail" to create new attractions that will help filter people into those communities. He also discussed working with the bigger tour operators, by giving advice on how to feed more tourists into these communities. CHAIRMAN KOTT inquired into Commissioner Hensley's relationship with the Alaska Visitor's Association (AVA), and the Tourism and Marketing Council, and asked what role he saw himself taking as Commissioner. Number 240 COMMISSIONER HENSLEY stated that he saw this as a partnership, where the Governor actually appoints half the members. He stated that they were trying to maximize Alaska as a destination. He spoke of tourism being such an important factor in employment and economic activity, and that his office would be interacting with the key players in the tourism business. Number 225 CHAIRMAN KOTT stated that he was happy to hear this, as he felt it extremely important to develop a good relationship with those two entities. Chairman Kott then asked Commissioner Hensley if he had any suggested changes concerning the marine pilots situation. Number 265 COMMISSIONER HENSLEY stated that there were less than one hundred marine pilots, but as a state, we can't take a laissez faire attitude. Since there are jobs, lives and property involved in this industry, whatever system they set up has to be able to accommodate growth in commerce in the event there are additional mining activities or the gas line becomes a reality. He also stated that we need to be assured that the training aspect of marine piloting is something that we're all comfortable with. CHAIRMAN KOTT asked Commissioner Hensley if perhaps the state should place greater emphasis on oversight or more decentralization. Number 294 COMMISSIONER HENSLEY responded that the department needed to play an active role in oversight. VICE CHAIRMAN ROKEBERG inquired into the taxation of the insurance industry and further asked what revenue is generated by such taxes. COMMISSIONER HENSLEY stated that he didn't have the figures in front of him, but the state brings in a significant amount of revenue from the insurance industry. Number 310 CHAIRMAN KOTT asked Commissioner Hensley about the Department of Commerce's involvement in the development of the A-J Mine. COMMISSIONER HENSLEY stated it has the potential for significant opportunity in employment, not only at the A-J Mine, but also at the Kensington and (indisc.). He added that, as a regulatory agency, the state needs to do everything possible to make sure that companies spending this kind of money to develop have an opportunity should have a fair hearing on the environmental impact. He stated that such companies need to know that the state is there to try to facilitate development because we want their investments. Number 346 CHAIRMAN KOTT stated that on behalf of the committee, he wanted to thank Commissioner Hensley for being available. He further stated that the Governor made an excellent choice in appointing Mr. Hensley, based on his background and knowledge. Number 364 REPRESENTATIVE KUBINA asked Chairman Kott if he was going to submit a letter of transmittal similar to the one stating they were before the body or submit something with a recommendation on whether to confirm or not confirm. CHAIRMAN KOTT stated that it would be the same format as utilized earlier with the appointees. He read a disclaimer at the bottom of the form, stating that this does not reflect the intent of the members to vote for or against the individual for the purposes of confirmation. REPRESENTATIVE KUBINA stated that when he was in the legislature in years earlier, it was the practice to make a recommendation on people. He further state that he thought that was why they had the committee hearings, just like on a bill, to state that the committee does or does not recommend this person for the position. CHAIRMAN KOTT felt that all of the committees were utilizing the present format, and that this was the way, they dealt with this in the 18th Legislative Session. REPRESENTATIVE KIM ELTON stated that the committee process was very important and that this is the one opportunity for dialogue with the commissioners. For the record, Representative Elton indicated his support for this nomination. He then moved that with the circulation of the letter, this be forwarded to the body. Number 405 VICE CHAIRMAN ROKEBERG stated that when this nomination comes to the floor, he will vote for it. REPRESENTATIVE BEVERLY MASEK stated that she had no comment at this time. Number 410 REPRESENTATIVE JERRY SANDERS stated that he's worked with and watched Commissioner Hensley for the past 15 years, through NANA Corporation and United Bank of Alaska. He stated since there was very little chance that Governor Knowles would submit a Republican, he felt we couldn't find a more capable or dedicated man in this state to take this position, and he intends to vote for Commissioner Hensley. Number 418 CHAIRMAN KOTT concurred with Representative Sanders that it wouldn't be likely that the Governor would submit a Republican. Chairman Kott noted that he'd had brief discussions with Commissioner Hensley, and having reviewed his resume, he couldn't find anything negative about this appointment. Chairman Kott stated that there was a motion to move the letter out of committee. Hearing no objection, the letter was moved out of committee. Number 435 CHAIRMAN KOTT asked Commissioner-Designee Tom Cashen, for the Department of Labor, to come forward and tell the committee why they should confirm his nomination. Number 441 COMMISSIONER-DESIGNEE TOM CASHEN, Department of Labor, stated that it was always his luck to follow someone like Commissioner Hensley. He talked of being a fourth generation Alaskan, and he stated that his ancestors came up in the 1880s for mining. He joined Local 942, in Fairbanks, in 1953. He added that, with the exception of a three year hitch in the Marine Corps, he's worked in Alaska all his life. He stated that he had the experience and maturity to be a good commissioner of the Department of Labor, and he was excited about the job. REPRESENTATIVE KUBINA stated that what they were looking at was a working man's resume and one of which he should be proud. Representative Kubina stated that he was just as excited about Tom Cashen serving as Commissioner as he was about Willie Hensley. REPRESENTATIVE ELTON stated that, as a member of the Juneau community, he knows what a great public servant Commissioner Cashen has been, while serving as a member of the Juneau Planning Commission and the Juneau School Board. Number 502 REPRESENTATIVE ROKEBERG inquired as to the constitutional problems concerning the local hire issue, and further inquired whether there was anything the state could legally do to provide more jobs for Alaskans. Number 510 COMMISSIONER CASHEN stated that for years, the legislature has tried to craft local hire legislation that would stand up in court and the courts always come back saying that you can't discriminate concerning residency. He stated that job owning with the industry would be an effective measure. He had some ideas on having a tax reversal credit, and that other than that, he didn't know of anything that could be done legislatively. Number 536 CHAIRMAN KOTT asked Commissioner Cashen what he felt would be the two biggest areas of concern that the department would face in the next two to four years. COMMISSIONER CASHEN stated that the main issues would be the jobs and local hire issues. He stated that in January, over $3.5 million was paid in out of state unemployment claims. CHAIRMAN KOTT asked Commissioner Cashen if he or his staff had any suggested changes that would lower the workman's compensation rates. COMMISSIONER CASHEN stated that he had talked with Paul Grossi, Director, Worker's Compensation, and some of his suggestions were to lower current deliveries of service, assure compliance with mandates of applicable statutes, and reestablish ties with the Ad Hoc Committee. He stated that there have been significant decreases in compensation since 1988. He stated that it was something that the workers had to have, and reminded the committee that to receive workman's compensation, workers give up the right to sue. Commissioner Cashen stated that, without workman's compensation, there would be great chaos. Number 642 CHAIRMAN KOTT asked Commissioner Cashen to comment on the Department of Labor's difficulty with their new computer system. Number 648 COMMISSIONER CASHEN noted that a new system was put on line in July, with some major problems. TAPE 95-7 SIDE B Number 000 REBECCA NANCE, DIRECTOR, EMPLOYMENT SECURITY DIVISION, Department of Labor, stated that she had no knowledge prior to her arrival on the job, of the critical computer situation taking place at the Employment Security Division. She stated she is working with the program managers and Texas Instruments, who is handling the contract. She said at the current time, they would meet their contractual obligation on April 12, 1995. The department hopes to have everything up and running within 30 days of that deadline. CHAIRMAN KOTT asked Ms. Nance if the users of the system were satisfied with the product they currently have, and further inquired whether they had been involved in the development of that product. MS. NANCE stated that up until last month, a limited number of users had been involved. She said that they have a training class scheduled, and she related that prior to her arrival, she didn't feel there was adequate input by the end users. CHAIRMAN KOTT asked what the cost of the contract was. MS. NANCE stated that she could get that information to the committee by tomorrow - February 23, 1995. Number 078 CHAIRMAN KOTT stated, for the record, that Representative Porter arrived at 3:50 p.m. He then stated that Commissioner Cashen had the support of the committee. REPRESENTATIVE SANDERS was very encouraged that Commissioner Cashen would do a good job. He stated that he intended to vote for his confirmation. CHAIRMAN KOTT commented on Commissioner Cashen's staff. REPRESENTATIVE ROKEBERG stated, for the record, that he'll be voting for and supporting his nomination. REPRESENTATIVE BRIAN PORTER apologized for being late and voiced his support of Commissioner Cashen. REPRESENTATIVE ELTON motion to move the letter. Hearing no objection, the motion to move the letter out of committee was adopted. He thanked Commissioner Cashen and his staff for coming before the Committee. ADJOURNMENT There being no further business to come before the House Labor and Commerce Standing Committee, CHAIRMAN KOTT adjourned the meeting at 3:58 p.m.