Legislature(1995 - 1996)

03/06/1995 03:08 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 6, 1995                                         
                           3:08 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                                                    
 MEMBERS ABSENT                                                                
 Representative Brian Porter                                                   
 COMMITTEE CALENDAR                                                            
  HB 17:   "An Act relating to the titles that describe the two                
           principal executive officers of electric and telephone              
           HEARD AND HELD                                                      
 HB 146:   "An Act relating to sled dog race classics."                        
           PASSED OUT OF COMMITTEE                                             
 *HB 220:  "An Act relating to the duties of the commissioner                  
           of commerce and economic development concerning                     
           the Alaska Tourism Marketing Council; relating to                   
           the per diem travel expenses of the council's                       
           board of directors; relating to the powers and                      
           duties of the council; extending the termination                    
           date of the council; and providing for an                           
           effective date."                                                    
           PASSED OUT OF COMMITTEE                                             
 (* First Public Hearing)                                                      
 WITNESS REGISTER                                                              
 REPRESENTATIVE GAIL PHILLIPS                                                  
 Alaska State Legislature                                                      
 Capitol Building, Room 208                                                    
 Juneau, AK 99802-1182                                                         
 Telephone:  (907) 465-2689                                                    
 POSITION STATEMENT:  Testified in favor of HB 146                             
 SENATOR LYDA GREEN                                                            
 Alaska State Legislature                                                      
 Capitol Building, Room 423                                                    
 Juneau, AK 99801-1182                                                         
 Telephone:  (907) 465-6600                                                    
 POSITION STATEMENT:  Testified in favor of HB 146                             
 DAVE LAMBERT, President                                                       
 Alaska Dog Musher's Association                                               
 P.O. Box 1243                                                                 
 Fairbanks, AK 99707                                                           
 Telephone:  (907) 457-6874                                                    
 POSITION STATEMENT:  Testified on HB 146                                      
 BRYCE EDGMON, Legislative Assistant                                           
   to Representative Richard Foster                                            
 Alaska State Legislature                                                      
 Capitol Building, Room 410                                                    
 Juneau, AK 99801-1182                                                         
 Telephone:  (907) 465-3789                                                    
 POSITION STATEMENT:  Provided sponsor statement for HB 146.                   
 DENNIS BOSHARD                                                                
 Division of Charitable Gaming                                                 
 Department of Revenue                                                         
 P.O. Box 110440                                                               
 Juneau, AK 99801-0440                                                         
 Telephone:  (907) 465-2229                                                    
 POSITION STATEMENT:  Provided information on HB 146                           
 ROD MOURANT, Administrative Assistant                                         
   to Representative Pete Kott                                                 
 Alaska State Legislature                                                      
 State Capitol, Room 432                                                       
 Juneau, AK 99801-1182                                                         
 POSITION STATEMENT:  Explained HB 220                                         
 JEFF BUSH, Deputy Commissioner                                                
 Department of Commerce and Economic Development                               
 P.O. Box 110800                                                               
 Juneau, AK 99811-0800                                                         
 POSITION STATEMENT:  Testified in support of HB 220                           
 BOB DINDINGER, Vice Chairman                                                  
 Alaska Tourism Marketing Council                                              
 9085 Glacier Highway                                                          
 Juneau, AK 99801                                                              
 Telephone:  (907) 789-0052                                                    
 POSITION STATEMENT:  Testified in support of HB 220                           
 JOHN LITTEN                                                                   
 Alaska Visitors Association                                                   
 P.O. Box 1001                                                                 
 Sitka, AK 99835                                                               
 POSITION STATEMENT:  Testified in support of HB 220                           
 JOHNE BINKLEY, President                                                      
 Alaska Visitors Association                                                   
 1975 Discovery Drive                                                          
 Fairbanks, AK 99709                                                           
 Telephone:  (907) 479-0035                                                    
 POSITION STATEMENT:  Testified in support of HB 220                           
 ALAN LEMASTER                                                                 
 P.O. Box 222                                                                  
 Gakona, AK 99586                                                              
 Telephone:  (907) 822-3664                                                    
 POSITION STATEMENT:  Testified in support of HB 220                           
 FREDERICK DURE, Member                                                        
 Alaska Visitors Association                                                   
 Alaska Wilderness Recreation                                                  
   and Tourism Association                                                     
 526 West 19th                                                                 
 Anchorage, AK 99503                                                           
 Telephone:  (907) 274-3038                                                    
 POSITION STATEMENT                                                            
 TINA LINDGREN, Executive Director                                             
 Alaska Visitors Association                                                   
 3201 C Street, Number 403                                                     
 Anchorage, AK 99503                                                           
 Telephone:  (907) 561-5733                                                    
 POSITION STATEMENT:  Testified in support of HB 220                           
 NANCY LETHCOE, President                                                      
 Alaska Wilderness Recreation and                                              
   Tourism Association                                                         
 P.O. Box 1353                                                                 
 Valdez, AK 99686                                                              
 Telephone:  (907) 835-4300                                                    
 POSITION STATEMENT:  Testified in support of HB 220                           
 PREVIOUS ACTION                                                               
 BILL:  HB 17                                                                
 SHORT TITLE: OFFICERS OF UTILITY COOPERATIVES                                 
 SPONSOR(S): REPRESENTATIVE(S) GREEN                                           
 JRN-DATE     JRN-PG                  ACTION                                   
 01/06/95        25    (H)   PREFILE RELEASED                                  
 01/16/95        25    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/16/95        25    (H)   STATE AFFAIRS, LABOR & COMMERCE                   
 02/07/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 02/07/95              (H)   MINUTE(STA)                                       
 02/10/95       293    (H)   STA RPT  CS(STA) NEW TITLE 6DP 1NR                
 02/10/95       294    (H)   DP: JAMES, PORTER, GREEN, ROBINSON                
 02/10/95       294    (H)   DP: WILLIS, OGAN                                  
 02/10/95       294    (H)   NR: IVAN                                          
 02/10/95       294    (H)   ZERO FISCAL NOTE (DCED)                           
 03/01/95              (H)   L&C AT 03:00 PM CAPITOL 17                        
 03/01/95              (H)   MINUTE(L&C)                                       
 BILL:  HB 146                                                               
 SHORT TITLE: SLED DOG RACE CLASSIC                                            
 SPONSOR(S): REPRESENTATIVE(S) FOSTER, Phillips, Mulder,                       
             Navarre, Brice, Grussendorf, Toohey, Ivan                         
 JRN-DATE     JRN-PG                  ACTION                                   
 02/03/95       235    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/03/95       235    (H)   CRA, L&C                                          
 02/13/95       343    (H)   COSPONSOR(S): IVAN                                
 02/14/95              (H)   CRA AT 01:00 PM CAPITOL 124                       
 02/14/95              (H)   MINUTE(CRA)                                       
 02/15/95       365    (H)   CRA RPT  4DP  1NR                                 
 02/15/95       366    (H)   DP: MACKIE, ELTON, IVAN, NICHOLIA                 
 02/15/95       366    (H)   NR: AUSTERMAN                                     
 02/15/95       366    (H)   ZERO FISCAL NOTE (REV)                            
 02/27/95              (H)   L&C AT 03:00 PM CAPITOL 17                        
 02/27/95              (H)   MINUTE(L&C)                                       
 03/01/95              (H)   L&C AT 03:00 PM CAPITOL 17                        
 03/01/95              (H)   MINUTE(L&C)                                       
 03/03/95              (H)   L&C AT 03:00 PM CAPITOL 17                        
 03/06/95              (H)   L&C AT 03:00 PM CAPITOL 17                        
 BILL:  HB 220                                                               
 SHORT TITLE: ALASKA TOURISM MARKETING COUNCIL                                 
 JRN-DATE     JRN-PG                  ACTION                                   
 03/01/95       531    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/01/95       531    (H)   LABOR & COMMERCE, FINANCE                         
 03/06/95              (H)   L&C AT 03:00 PM CAPITOL 17                        
 ACTION NARRATIVE                                                              
 TAPE 95-14, SIDE A                                                            
 Number 000                                                                    
 The House Labor and Commerce Standing Committee was called to order           
 by Chairman Pete Kott at 3:08 p.m.  Members present at the call to            
 order were Representatives Kott, Rokeberg, Sanders, Masek, Elton              
 and Kubina.  Representative Porter was absent.                                
 HB 17 - OFFICERS OF UTILITY COOPERATIVES                                    
 CHAIRMAN PETE KOTT requested that the committee rescind their                 
 previous action on HB 17 as amended.  He explained that when the              
 committee substitute was forwarded to the drafting attorney, she              
 brought up several concerns that needed to be addressed.                      
 REPRESENTATIVE NORMAN ROKEBERG made a motion to rescind action on             
 HB 17.                                                                        
 REPRESENTATIVE KIM ELTON asked when the bill would be rescheduled.            
 CHAIRMAN KOTT stated it would be scheduled on March 13, and heard             
 on March 15.  Chairman Kott asked for objections on the motion.               
 Hearing none, the motion passed.                                              
 HB 146 - SLED DOG RACE CLASSIC                                               
 Number 076                                                                    
 REPRESENTATIVE GAIL PHILLIPS expressed how important the Iditarod             
 was to her.  She served on the Board of Directors and has served as           
 race coordinator for three years.  She stated that people all                 
 across the country and around the world are interested in the                 
 Iditarod.  In recent years, however, the race has been the subject            
 of much unwarranted controversy generated by extensive                        
 misinformation campaigns initiated by animal rights extremists.               
 She stated that these extremists intentionally distort the                    
 Iditarod's noble history and tradition in an effort to generate               
 contributions from outsiders unfamiliar with the sport.  She                  
 continued that the barrage of negative and misinformed publicity              
 has led to the withdrawal of several large national sponsorships.             
 She stated that this year sponsor withdrawals total $390,000, and             
 an additional $175,000 will be lost next year.  She pointed out               
 that without these revenues, the ability of the Iditarod Trail                
 Committee (ITC) to stage the race is threatened.  She concluded by            
 stating that the Iditarod Sweepstakes Sled Classic is a game of               
 chance, similar to the Kenai River Snow Goose Classic, the Nenana             
 River Ice Classic, salmon classics and many other classics                    
 currently authorized by statute.  Authorizing this fund raising               
 activity would assist the committee in it's efforts to replace lost           
 sponsorship revenues.                                                         
 REPRESENTATIVE BRIAN PORTER joined the meeting at 3:15.                       
 Number 182                                                                    
 SENATOR LYDA GREEN stated that she had sponsored similar                      
 legislation in the Senate.  She concurred with Representative                 
 Phillips and stated that the ITC should be making sure arrangements           
 have been made and that all of the check points are in place,                 
 rather than having to spend so much time on fund raising and                  
 outside efforts.  She stated since 1977, the state has contributed            
 to the Iditarod in excess of $1 million.  This is a trend the ITC             
 would like to reverse.  Through this method the ITC could become              
 self supporting.                                                              
 Number 212                                                                    
 testified via teleconference.  He asked what the purpose of HB 146            
 was.  He stated that the ITC can now, and always has been able to,            
 hold a sled dog classic.  He continued that the ADMA is currently             
 holding a classic on the Open North American Sled Dog Race.  He               
 stated that this legislation will not give the ITC the right to do            
 anything they can't do now.  What it will do, he stated, is ban any           
 other organization from having sled dog race classics.  He inquired           
 again as to the purpose of this bill.                                         
 Number 214                                                                    
 CHAIRMAN KOTT explained that a person would bet on winning times              
 into checkpoints and the finishing time into Nome.                            
 FOSTER, stated that he did have a legal opinion from Jerry                    
 Luckhaupt, Legislative Council, that states "the committee                    
 substitute that is before you would not prevent other sled dog                
 races from doing anything they're currently permitted to do."  Mr.            
 Edgmon emphasized that this bill has no restrictive qualities.                
 Number 262                                                                    
 MR. LAMBERT reiterated his query of what the purpose of the                   
 legislation was.  He stated that the way he reads the legislation,            
 it does say "limited to the Iditarod Sweepstakes".                            
 MR. EDGMON stated that this legislation creates sled dog classics             
 and gives the ITC the ability to conduct statewide sweepstakes                
 under the banner of "Sled Dog Classic."  He continued that under              
 Title 5, there is statutory authority for dog races to conduct                
 gaming activities to bet on the finishing times of mushers or the             
 individual mushers themselves.  He explained that this bill allows            
 for the clarification of wagering on arrival times into check                 
 points as well as the finish line into Nome.                                  
 Number 282                                                                    
 MR. LAMBERT disagreed.  He stated that the Nenana Ice Classic still           
 needs to get approval from local municipalities just like any other           
 Number 292                                                                    
 REPRESENTATIVE BEVERLY MASEK, in reference to the memorandum to               
 Senator Green from Jerry Luckhaupt, asked what the different types            
 of charitable games were.                                                     
 MR. EDGMON stated that the intent of Representative Foster was to             
 give the ITC the gaming authority to conduct statewide sweepstakes.           
 Once this legislation has passed, the ITC will have the authority             
 to devise the particulars in gaming activities, working in                    
 conjunction with the Division of Charitable Gaming.                           
 Number 315                                                                    
 CHAIRMAN KOTT stated that it was his opinion that this bill would             
 not diminish any of the opportunities that currently exist under AS           
 MR. EDGMON stated that was correct and that this point has been               
 reinforced by the Department of Law and Legislative Legal Services.           
 Number 329                                                                    
 REPRESENTATIVE ROKEBERG inquired into the differences.                        
 MR. EDGMON answered that this legislation gives the ITC the                   
 authority to bet on arrival times and to use sled dog race classics           
 in conducting these activities.                                               
 Number 340                                                                    
 CHAIRMAN KOTT stated that, under present law, you cannot wager                
 based on finishing times or checkpoint times.                                 
 MR. EDGMON observed that these statutes are generally worded.  He             
 said that it is clearly stated that the objective is to create sled           
 dog classics for the ITC to administer.                                       
 CHAIRMAN KOTT inquired whether, if this legislation were to pass,             
 and was applied to the Iditarod Classic, they then would be                   
 excluded as a dog musher contest.                                             
 MR. EDGMON stated that they wouldn't be excluded.                             
 Number 360                                                                    
 REVENUE, stated that this legislation would not prohibit other                
 organizations from getting the proper permits and conducting a dog            
 mushers contest of the same nature.  He pointed out that there is             
 no discussion of arrival times into checkpoints in the current                
 Number 381                                                                    
 REPRESENTATIVE MASEK asked who would be overseeing these                      
 MR. BOSHARD responded that all charitable gaming is overseen by the           
 Division of Charitable Gaming.                                                
 Number 397                                                                    
 REPRESENTATIVE ROKEBERG stated that he still hadn't heard an answer           
 to his question.                                                              
 CHAIRMAN KOTT stated, for the record, that they did not have the              
 CSHB 146 before the committee; they had HB 146 before the                     
 Number 403                                                                    
 SENATOR GREEN stated that, up until now, there was a connection               
 with a particular musher or dog team.  She stated that the bill               
 would only cover elapsed time.                                                
 REPRESENTATIVE ROKEBERG asked why it had individual checkpoints in            
 the statute.                                                                  
 REPRESENTATIVE PORTER answered that there would be more                       
 opportunities for betting.                                                    
 CHAIRMAN KOTT pointed out that in the existing language, it ties in           
 with individual teams.  He stated that in HB 146 they were not                
 "musher specific."                                                            
 REPRESENTATIVE JERRY SANDERS stated that Section 4, would make the            
 actions of this bill exclusive to the ITC.  He asked if they would            
 consider an amendment to delete Section 4.                                    
 REPRESENTATIVE PORTER commented that if Section 4 is eliminated, it           
 would eliminate the bill.                                                     
 REPRESENTATIVE PORTER made a motion to adopt the CSHB 146 version             
 G, dated 2-21-95.                                                             
 REPRESENTATIVE GENE KUBINA stated that he didn't see a difference             
 in the two.                                                                   
 Number 489                                                                    
 MR. EDGMON stated that the difference was in the title.  The intent           
 of the title change is to make the bill specific to the Iditarod.             
 CHAIRMAN KOTT noted that the motion before them was for work draft            
 G, which would be the CS.                                                     
 REPRESENTATIVE ELTON stated that he had an amendment that would               
 broaden this legislation.                                                     
 CHAIRMAN KOTT interjected that they should adopt the draft for                
 discussion.  He asked for objections.  Hearing none, the motion was           
 REPRESENTATIVE ELTON explained the following:  On page 2, lines 12            
 and 13, strike everything after "checkpoints along the race" and              
 insert "provided the game of chance is administered by the                    
 non-profit organization that conducts the sled dog race."  He noted           
 that this amendment would also require a title change.                        
 Number 534                                                                    
 REPRESENTATIVE PORTER objected.  He stated that he didn't disagree            
 with the amendment, but he feels that the legislature would lose              
 the ability to say that we're trying to do something for the                  
 REPRESENTATIVE KUBINA felt that the amendment might limit other               
 organizations from holding classics on other races.                           
 Number 560                                                                    
 REPRESENTATIVE ELTON stated that this broadens the definition of a            
 sled dog classic to include other races.  It wouldn't restrict                
 practices that are already occurring.  He commented that some of              
 the other races have now been targeted by the Humane Society of the           
 United States (HSUS) creating financial difficulties for them as              
 well.  He pointed out that they can't forget about the qualifying             
 races for the Iditarod.                                                       
 Number 585                                                                    
 CHAIRMAN KOTT concurred with Representative Porter that they were             
 trying to bail out one aspect of Alaska's dog racing.                         
 REPRESENTATIVE MASEK observed that they should not forget about               
 sprint, mid and long distance racing in the state.  She stated that           
 she was not against helping out the Iditarod but felt they should             
 look at the mushing community as a whole.                                     
 MR. EDGMON noted that the smaller races conduct gaming activities.            
 This bill doesn't shut the door on these races.  Instead, it opens            
 the door for the Iditarod to conduct statewide sweepstakes under              
 the banner of sled dog race classic.                                          
 CHAIRMAN KOTT asked Mr. Edgmon to comment on the amendment.                   
 MR. EDGMON answered right now, other organizations could conduct              
 sweepstakes on the Iditarod.  This would narrow it down to just the           
 ITC having the ability to do that.                                            
 CHAIRMAN KOTT asked if the objection was still maintained.                    
 REPRESENTATIVE PORTER answered that it was.                                   
 CHAIRMAN KOTT asked for a roll call vote.  Voting for the amendment           
 were Representatives Sanders, Masek and Elton.  Voting against the            
 amendment were Representatives Kubina, Porter and Kott.                       
 CHAIRMAN KOTT stated Amendment 1 failed to be adopted.                        
 Number 630                                                                    
 REPRESENTATIVE PORTER made a motion to move CSHB 146(L&C) with                
 individual recommendations and accompanying fiscal notes out of               
 CHAIRMAN KOTT asked if there were objections.  Hearing none, the              
 motion passed.                                                                
 TAPE 95-14, SIDE B                                                            
 HB 220 - ALASKA TOURISM MARKETING COUNCIL                                   
 Number 000                                                                    
 CHAIRMAN KOTT stated that the next bill up was HB 220.                        
 prime sponsor of HB 220, stated that HB 220 extends the sunset date           
 of the Alaska Tourism Marketing Council (ATMC) from the current               
 date of 1996, to 1999.  He stated, that with the decline in oil               
 production and oil pricing, alternate sources of state revenue and            
 private sector diversity and expansion become more important each             
 year.  This legislation calls on the Commissioner of the Department           
 of Commerce and Economic Development to contract with qualified in-           
 state trade associations to promote tourism, and Alaska as a                  
 visitor destination point, through a cooperative marketing effort.            
 Mr. Mourant continued that it states if a qualified in-state trade            
 association exists and is interested.  It also enables an industry            
 directed approach rather than one that's bureaucratic directed or             
 bureaucratic run.  He stated that the legislation also changes the            
 travel and per diem statutes relating to the ATMC.  He explained              
 that at the current time, most in-state travel is borne by the                
 individual board members.  This would allow the board members, when           
 travelling out of state, to be reimbursed for their expenses.                 
 MR. MOURANT stated that Sections 3 and 4 elevate the importance of            
 the ATMC, to the commissioner's level of respect.  It does so by              
 calling on the Commissioner to review the budget as proposed by               
 ATMC, rather than the Director of Tourism, and further by calling             
 on the Commissioner as opposed to the Director of Tourism, to sign            
 a contract with the qualified and selected tourism association.               
 MR. MOURANT stated that Section 5 changes the sunset date from 1996           
 to 1999.  He added that the fiscal note that accompanies shows no             
 expense in FY96 and FY97.  It projects the operating budget of the            
 ATMC as the fiscal note.                                                      
 Number 075                                                                    
 REPRESENTATIVE ELTON asked why they chose the date of December 30,            
 1999, rather than the end of the fiscal year of June 30.                      
 MR. MOURANT replied that traditionally, sunset dates are extended             
 in four year increments.  The change of the contract language in              
 Section 1, page 2 line 2, allows for development and consistency in           
 the marketing effort, instead of going through the expense and                
 effort of redesigning a marketing effort every two years.                     
 Number 104                                                                    
 REPRESENTATIVE ELTON noted that the contract with the industry                
 group ends six months prior to the ending of the ATMC, if the                 
 Sunset is not removed.  He inquired as to why you wouldn't want               
 both to occur at the same time, instead of being separated by six             
 MR. MOURANT stated that this wasn't intentional, but it has worked            
 out so that if they go into a wind down year, it gives the                    
 subsequent legislature time to consider the circumstance.                     
 CHAIRMAN KOTT added that the bill extends an opportunity for the              
 contract to be extended up to four years, but not mandating it.               
 Number 135                                                                    
 REPRESENTATIVE GENE KUBINA stated that they should leave in Section           
 1, the language that reads "the best interest in the state."                  
 MR. MOURANT explained that the best interest of the state, in                 
 regard to ATMC and tourism marketing, is demonstrated already                 
 through actions of the legislature.  This is done by the extension            
 of the sunset date of ATMC and also with the adoption of a budget.            
 He stated that the purpose of changing the language to "a qualified           
 trade association in-state that has an interest in promoting", is             
 to allow an industry directed promotional effort in Alaska, as                
 opposed to a bureaucracy doing the same thing.                                
 REPRESENTATIVE ELTON stated that there is a declaration of intent             
 by the legislature that promoting tourism is in the best interest             
 of the state.  We're talking here about taking that legislative               
 intent out.  He stated that he would like to keep the statement,              
 "that it is in the best interest of the state to promote tourism."            
 Number 181                                                                    
 MR. MOURANT pointed out that the operative language in the                    
 amendment is that the commissioner can determine there is in fact             
 a qualified trade association in the state that is interested in              
 promoting.  He commented that they were calling on the commissioner           
 to make the determination that there is one.  The commissioner                
 shall contract with a single qualified trade association.                     
 Number 194                                                                    
 DEVELOPMENT, testified in support of HB 220.  In reference to the             
 December date mentioned earlier, he stated that this language is              
 already in existing law, and there's not any change.  He commented            
 that if the committee felt it better to coincide with the fiscal              
 year than the calendar year, there wouldn't be much opposition.  He           
 suggested a change the department would like to see.  On page 1,              
 line 11, change the word "shall" to "may", so the Commissioner is             
 given some discretion on when to enter into the contract with the             
 qualified trade association.  In response to an earlier question of           
 whether "in the state" should be included with respect to the                 
 qualified trade association, he stated that this was unnecessary,             
 as this language is already included in the definition of a                   
 qualified trade association in the statute.                                   
 Number 240                                                                    
 REPRESENTATIVE PORTER asked if changing the "shall" to "may", would           
 allow the commissioner to have regional organizations rather than             
 one single organization.                                                      
 MR. BUSH responded that it wouldn't.  He explained that the                   
 definition of qualified trade association, requires that it be a              
 statewide organization.                                                       
 Number 259                                                                    
 CHAIRMAN KOTT asked if through the negotiating process, some kind             
 of promulgated agreement could occur between the department and the           
 trade association.                                                            
 MR. BUSH stated that if no contract is entered into with a                    
 qualified trade association, the ATMC still exists.  The Board of             
 Directors of the ATMC consists of the director of the Division of             
 Tourism and two other commissioners, one being the Commissioner of            
 Commerce, the other Commissioner is appointed by the Governor.  Mr.           
 Bush stated that there is an interest from both parties'                      
 perspective to enter into a contract.                                         
 CHAIRMAN KOTT asked if the insertion of "may" would allow the                 
 department to circumvent the existing trade association and permit            
 the Division of Tourism to promote Alaska.                                    
 Number 288                                                                    
 MR. BUSH responded under that circumstance, the department would              
 have some discretion to decide to enter into a contract.  The                 
 department has an interest in promoting ATMC.  The insertion of               
 this language gives the state some discretion to negotiate.                   
 Number 316                                                                    
 REPRESENTATIVE KUBINA agreed with department.                                 
 MR. BUSH stated that the AVA's position is that it is the best                
 interest of the state to create a joint cooperative marketing                 
 program.  He stated taking "it is in the best interest of the                 
 state" and inserting changing "shall" to "may", states more                   
 accurately that a cooperative marketing program is an appropriate             
 device, but also leaves the department some discretion on                     
 negotiating a contract.                                                       
 Number 348                                                                    
 CHAIRMAN KOTT pointed out that this language had been here since              
 1987, the year prior to the creation of the ATMC.                             
 Number 355                                                                    
 REPRESENTATIVE ELTON asked if there was any discussion on the                 
 departmental level whether they might want to have three years with           
 three (one year) extensions.                                                  
 MR. BUSH stated that there had been no discussion on that point.              
 He agreed with Representative Elton that a long term contract was             
 the way to go.                                                                
 CHAIRMAN KOTT asked if the length of the contract would give any              
 Number 373                                                                    
 REPRESENTATIVE KUBINA asked if there were problems with contracts             
 extending longer than a Governor's term.                                      
 MR. BUSH responded that contracts are cancelable on a certain                 
 amount of notice.                                                             
 (ATMC), testified in favor of HB 220.  In reference to the issue              
 travel reimbursement, he explained that some board members had                
 traveled to New York on several occasions to finalize the deal with           
 the Good Morning America Show.  The board did not pay them any                
 compensation, salary or otherwise, but did feel that they should be           
 compensated for travel.  The board then discovered a possible                 
 interpretation of the by-laws that travel expenses were not                   
 reimbursable.  However, at the time of the negotiation of the ATMC,           
 the non-allowable reimbursement for out of state travel applied if            
 the board were to hold meetings out of state.  He pointed out that            
 it is not the intention of the council to hold meetings out of                
 state.  But to do the business of the council, some members may               
 have to travel out of state for non-meeting purposes.                         
 MR. DINDINGER explained that, on the issue of the sunset date, they           
 chose December as opposed to June 30, to allow for a six month wind           
 down period if the council were to ever sunset.  He closed by                 
 stating that the ATMC was in concurrence with the department in               
 changing the language from "shall" to "may".                                  
 Number 458                                                                    
 JOHN LITTEN, ALASKA VISITORS ASSOCIATION (AVA), testified via                 
 teleconference in support of HB 220.  He stated that he has                   
 followed this statute closely since its inception in 1986.  Mr.               
 Litten said that the language changes have enabled the ATMC to make           
 adjustment in the programs that help Alaska remain competitive in             
 the national marketplace.  He concluded that the changes being                
 proposed today are minor.  They enable the council to promote                 
 effectively, and they clarify the responsibilities of the                     
 Commissioner and the council.                                                 
 Number 477                                                                    
 testified via teleconference in support of HB 220.  He commented              
 that the extension date would have no material effect on the                  
 extension or re authorization of the ATMC.  He continued that they            
 didn't have any opposition to the department's recommendation of              
 changing the word "shall" to "may".                                           
 Number 505                                                                    
 ALAN LEMASTER testified in support of HB 220.  He stated that he              
 was an ex-member of the AVA, and he felt that the organization has            
 done a great job over the many years, along with the ATMC, and                
 continues to do the best job it can.  However, he explained that he           
 is an ex-member of the AVA, and an ex-advertiser in the ATMC                  
 vacation planner, because he can't afford it.  He stated that the             
 25 percent matching fund policy dictated by the legislature is                
 cutting hundreds and hundreds of businesses ability to advertise in           
 this very important place.  He stated that the same advertising of            
 a two inch color ad with a two inch narrative, which two years ago            
 cost him $1,200 would now cost him $2,800.  He explained that                 
 Alaska desperately needs the AVA and ATMC, but also desperately               
 needs a program that won't exclude the small businesses in favor of           
 the large companies that can afford to advertise.                             
 Number 527                                                                    
 REPRESENTATIVE KUBINA asked Mr. Lemaster what he felt the                     
 legislature or AVA could do to help with that issue.                          
 MR. LEMASTER stated that a year or two ago the legislature mandated           
 that the AVA come up with a 25 percent matching fund.  In order to            
 raise those funds, the AVA found it necessary to increase the cost            
 of the advertising in the vacation planner, which is the small                
 businessman's tool.  He pointed out that the AVA may be getting               
 more money from the legislature this year, so this would further              
 raise advertising costs.  The problem he stated was with the 25               
 percent matching fund.                                                        
 teleconference in support of HB 220.  He stated that he had 20                
 years experience in the tourism industry.  He is currently a                  
 marketing consultant for small and medium sized businesses that               
 generally have sales less than $1 million.  He stated he supports             
 HB 220; however, the proposed rewording in Section 1, (b), if                 
 approved could have a major negative impact on the several thousand           
 Alaskan tourism businesses.  He stated the following four concerns:           
 He supports the general concept;  however, he and others are                  
 adamantly against the proposed change to Section 1, (b) that reads            
 "if the commissioner determines that it is in the best interest of            
 the state to promote the state as a destination through the                   
 cooperative marketing program, the commissioner shall contract with           
 a single qualified trade association to jointly manage the                    
 council".  This is to be replaced by "there is a qualified trade              
 association in the state that has an interest in promoting the                
 state as a destination".  He said that this rewording empowers the            
 AVA to the exclusion of those tourism business interests which are            
 not represented or supported by the AVA.  To exclude the qualifier            
 "in the best interest of the state," would do an injustice to                 
 businesses not represented or supported by the AVA.  There is not             
 equal representation for the majority of the industry segments,               
 with half the seats on the ATMC placed by the AVA, the other half             
 acquired from influence from the AVA.  Those that are members of              
 the AVA, and are supported by its powers, are able to leverage                
 their representation in the marketing of Alaskan tourism.  Contrary           
 to popular belief, he stated, of the more than 3,000 tourism                  
 business in Alaska, only approximately 700 are members of the AVA.            
 He said that he didn't feel this is a fair and equal representation           
 of Alaska.                                                                    
 Number 604                                                                    
 REPRESENTATIVE ELTON stated that it was common to hear complaints             
 about the Juneau and Anchorage Chamber of Commerce.  One of the               
 ways to assure that those segments of the visitor industry that are           
 under represented in the AVA, is to join AVA so that you can                  
 increase your representation and change the corporate culture, as             
 opposed to denying the state the ability to contract exclusively              
 with the AVA.                                                                 
 MR. DURE acknowledged that this was an excellent point.  However,             
 he stated this was like the chicken with the egg problem.  Does the           
 AVA recognize the interests of all the different industry segments,           
 and, therefore, present equal representation, or do the industry              
 suppliers that aren't represented by the AVA join the AVA to change           
 the corporate culture to gain the equal representation they want.             
 Number 618                                                                    
 TINA LINDGREN, EXECUTIVE DIRECTOR, Alaska Visitors Association,               
 testified via teleconference in support of HB 220.  She affirmed              
 that the AVA represents members in all segments of the industry.              
 Ms. Lindgren stated that the businesses that feel there is not                
 equal representation should make themselves known to the Governor's           
 Office.  She stated that the passage of HB 220 was the number one             
 priority of the AVA, due to the importance of cooperative marketing           
 and the jobs that are directly affected.  She agreed that                     
 (indisc.---end of tape)                                                       
 TAPE 15, SIDE A                                                               
 Number 000                                                                    
 ASSOCIATION (AWRTA), testified that they support the                          
 reauthorization of the ATMC.  However, she suggested changes in the           
 legislation.  Ms. Lethcoe stated that they support retaining the              
 language "it is the best interest of the state to promote the state           
 as a destination".  She explained that the legislature makes the              
 best interest determination, on a general level, and the                      
 commissioner should retain the ability to make that determination             
 on a specific level.  In addition, with respect to the language               
 "the commissioner may or shall contract with a single qualified               
 trade association", she requested the word "single" be deleted.               
 Ms. Lethcoe suggested that the commissioner be given the option of            
 allocating some of the state's tourism marketing dollars, to groups           
 that represent specific components of the tourism industry, such as           
 hunting, sport fishing, and wilderness guides, as well as                     
 geographic areas such as local convention and visitor's bureaus.              
 She continued that in Section 2, page 2, line 17, they would like             
 the number 10 changed to 8, so the line would read "the contract              
 shall provide that the trade association may select up to 8                   
 members.  On line 21 the change would be from 10 to 12, the line              
 would read "the governor shall appoint 12 other board members."               
 The reason for the change is that board members appointed by the              
 trade organization are appointed on the basis of the amount of                
 money their companies contribute to the marketing program, and not            
 on the basis of geographic representation or the segment of tourism           
 they represent.  She explained that board members appointed by the            
 Governor are broadly representative of different regions of the               
 state.  She stated that the change to line 24 would make sure that            
 the state's marketing dollars are distributed equitably throughout            
 the state.                                                                    
 Number 089                                                                    
 REPRESENTATIVE KUBINA asked if her association had ever taken these           
 concerns to the AVA.                                                          
 MS. LETHCOE replied that she had recently spoken with the AVA on              
 the change to the language "best interest to the state" however,              
 she stated that the AWRTA was not a member of the AVA, and they do            
 not support the governing structure of the AVA.  She commented that           
 voting rights within the AVA depend on how much money you paid in             
 membership fees.  It is difficult for small businesses to effect              
 change from within the AVA.                                                   
 REPRESENTATIVE KUBINA asked if this was brought up during the                 
 MS. LETHCOE, stated that she sat on the transition policy team for            
 marketing.  The major point of conflict was whether it should be              
 the policy that state money should be spent primarily to market               
 Alaskan owned and operated businesses, or to promote the greatest             
 number of people coming to the state.  She stated that cruise ship            
 passengers only spend approximately 17 percent of their travel                
 dollars within the state, whereas independent package visitors                
 spend 84 percent of their money within the state.  She asked that             
 there be an independent study on the economic impact of the                   
 CHAIRMAN KOTT commented that the McDowell Group does a yearly                 
 MS. LETHCOE responded that they don't study these types of                    
 CHAIRMAN KOTT asked if there was any further public testimony.                
 Hearing none, public testimony was closed.                                    
 Number 187                                                                    
 REPRESENTATIVE PORTER made a motion that on page 1, line 11, the              
 "shall" be changed to "may".                                                  
 CHAIRMAN KOTT stated that there was a motion to change the language           
 on page 1, line 11, from "shall" to "may".  He asked if there was             
 an objection to Amendment 1.  Hearing none, Amendment 1 was                   
 REPRESENTATIVE KUBINA commented that he would follow up on the                
 suggestions made by Nancy Lethcoe and talk to AVA and the                     
 department concerning these issues.                                           
 Number 209                                                                    
 REPRESENTATIVE ELTON stated that he would argue against removing              
 "single qualified trade association".  He explained that if you               
 start taking things from under the umbrella, the umbrella gets many           
 holes.  He suggested that instead of trying to designate seats for            
 highway, sport fishing, or eco-tourism, an alternative may be to              
 designate a certain number of seats to those companies that have an           
 Alaskan payroll of over $1 million and a certain number to Alaskan            
 payrolls under $1 million.  He made a motion to move the bill                 
 Number 237                                                                    
 CHAIRMAN KOTT commented that there was a balance between government           
 and the private sector with the ATMC.  He stated that partnership             
 has been instrumental in turning the State's tourism industry                 
 around.  Since the inception of the ATMC, there has been a steady             
 growth of visitors to the state.                                              
 Number 249                                                                    
 REPRESENTATIVE PORTER concurred with Chairman Kott.                           
 REPRESENTATIVE ROKEBERG made a motion to pass CSHB 220(L&C) out of            
 committee with individual recommendations and accompanying fiscal             
 Number 263                                                                    
 CHAIRMAN KOTT asked if there were objections.  Hearing none, the              
 motion passed.                                                                
 There being no further business to come before the House Labor and            
 Commerce Standing Committee, Chairman Kott adjourned the meeting at           

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