Legislature(1995 - 1996)

02/20/1995 03:05 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= 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                      
 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                   
 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             
 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               
 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                     
 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                            
 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             
 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                      
 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                  
 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                      
 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                     
 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             
 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                                                                    
 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                      
 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.                                        
 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.                                                          

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