Legislature(2003 - 2004)

05/03/2004 04:30 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                          May 3, 2004                                                                                           
                           4:30 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Tom Anderson, Chair                                                                                              
Representative Carl Gatto, Vice Chair                                                                                           
Representative Nancy Dahlstrom                                                                                                  
Representative Bob Lynn                                                                                                         
Representative Norman Rokeberg                                                                                                  
Representative Harry Crawford                                                                                                   
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative David Guttenberg                                                                                                 
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                              
CONFIRMATION HEARING(S)                                                                                                         
                                                                                                                                
Alcoholic Beverage Control Board                                                                                              
                                                                                                                                
     Duane S. Udland - Anchorage                                                                                                
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
State Assessment Review Board                                                                                                 
                                                                                                                                
     Allen S. Black - Palmer                                                                                                    
     Patrick S. Carlson - Kodiak                                                                                                
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
Board of Marine Pilots                                                                                                        
                                                                                                                                
     Robert J. Arts - Anchorage                                                                                                 
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
Alaska Workers' Compensation Board                                                                                            
                                                                                                                                
     Valarie L. Allmon - Anchorage                                                                                              
                                                                                                                                
     Chris N. Johansen - Fairbanks                                                                                              
                                                                                                                                
     David Kester - Anchorage                                                                                                   
                                                                                                                                
     James (Jay) N. Rhodes - Ketchikan                                                                                          
                                                                                                                                
     Patricia A. Vollendorf - Anchorage                                                                                         
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
State Board  of Registration for Architects,  Engineers, and Land                                                             
Surveyors                                                                                                                     
                                                                                                                                
     Craig Fredeen - Eagle River                                                                                                
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
Board of Barbers and Hairdressers                                                                                             
                                                                                                                                
     Debra Long - Fairbanks                                                                                                     
                                                                                                                                
     Joylene Marrs - Anchorage                                                                                                  
                                                                                                                                
     Angela J. Rosas - Houston                                                                                                  
                                                                                                                                
     Larry Allen Ungerecht - Anchorage                                                                                          
                                                                                                                                
     - CONFIRMATION(S) ADVANCED                                                                                                 
                                                                                                                                
CS FOR SENATE BILL NO. 357(FIN)                                                                                                 
"An  Act  relating  to the  regulation  of  insurance,  insurance                                                               
licenses, qualifications  of insurance producers,  surplus lines,                                                               
fraud  investigations,  electronic transactions,  and  compliance                                                               
with federal  law and  national standards;  and providing  for an                                                               
effective date."                                                                                                                
                                                                                                                                
     - MOVED HCS CSSB 357(L&C) OUT OF COMMITTEE                                                                                 
                                                                                                                                
SENATE BILL NO. 389                                                                                                             
"An Act  relating to  the conversion  of certain  corporations to                                                               
limited  liability  companies;  and providing  for  an  effective                                                               
date."                                                                                                                          
                                                                                                                                
     - MOVED SB 389 OUT OF COMMITTEE                                                                                            
                                                                                                                                
CS FOR SENATE BILL NO. 365(FIN)                                                                                                 
"An   Act  relating   to   the   regulation  of   speech-language                                                               
pathologist assistants; and providing for an effective date."                                                                   
                                                                                                                                
     - MOVED CSSB 365(FIN) OUT OF COMMITTEE                                                                                     
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                              
BILL: SB 357                                                                                                                  
SHORT TITLE: INSURANCE                                                                                                          
SPONSOR(S): LABOR & COMMERCE                                                                                                    
                                                                                                                                
03/01/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/01/04       (S)       L&C, FIN                                                                                               
03/09/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/09/04       (S)       Heard & Held                                                                                           
03/09/04       (S)       MINUTE(L&C)                                                                                            
03/23/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/23/04       (S)       Moved CSSB 357(L&C) Out of Committee                                                                   
03/23/04       (S)       MINUTE(L&C)                                                                                            
03/24/04       (S)       L&C RPT CS  2DP 3NR          SAME TITLE                                                                
03/24/04       (S)       NR: BUNDE, FRENCH, STEVENS G;                                                                          
03/24/04       (S)       DP: SEEKINS, DAVIS                                                                                     
03/31/04       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/31/04       (S)       Heard & Held                                                                                           
03/31/04       (S)       MINUTE(FIN)                                                                                            
04/01/04       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/01/04       (S)       Heard & Held                                                                                           
04/01/04       (S)       MINUTE(FIN)                                                                                            
04/02/04       (S)       FIN RPT CS   3DP 3NR         SAME TITLE                                                                
04/02/04       (S)       DP: WILKEN, GREEN, STEVENS B;                                                                          
04/02/04       (S)       NR: DYSON, OLSON, BUNDE                                                                                
04/02/04       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/02/04       (S)       Moved CSSB 357(FIN) Out of Committee                                                                   
04/02/04       (S)       MINUTE(FIN)                                                                                            
04/16/04       (S)       TRANSMITTED TO (H)                                                                                     
04/16/04       (S)       VERSION: CSSB 357(FIN)                                                                                 
04/19/04       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/19/04       (H)       L&C                                                                                                    
04/21/04       (H)       FIN REFERRAL ADDED AFTER L&C                                                                           
04/30/04       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
04/30/04       (H)       -- Meeting Canceled --                                                                                 
05/01/04       (H)       L&C AT 3:00 PM CAPITOL 17                                                                              
05/01/04       (H)       -- Meeting Canceled --                                                                                 
05/03/04       (H)       FIN AT 1:30 PM HOUSE FINANCE 519                                                                       
05/03/04       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
                                                                                                                                
BILL: SB 389                                                                                                                  
SHORT TITLE: CORP. CONVERSION TO LIMITED LIABILITY CO.                                                                          
SPONSOR(S): LABOR & COMMERCE                                                                                                    
                                                                                                                                
04/15/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
04/15/04       (S)       L&C                                                                                                    
04/20/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
04/20/04       (S)       Moved SB 389 Out of Committee                                                                          
04/20/04       (S)       MINUTE(L&C)                                                                                            
04/21/04       (S)       L&C RPT 3DP 2NR                                                                                        
04/21/04       (S)       NR: BUNDE, FRENCH;                                                                                     
04/21/04       (S)       DP: DAVIS, SEEKINS, STEVENS G                                                                          
04/27/04       (S)       TRANSMITTED TO (H)                                                                                     
04/27/04       (S)       VERSION: SB 389                                                                                        
05/01/04       (H)       READ THE FIRST TIME - REFERRALS                                                                        
05/01/04       (H)       L&C, FIN                                                                                               
05/03/04       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
                                                                                                                                
BILL: SB 365                                                                                                                  
SHORT TITLE: SPEECH-LANGUAGE PATHOLOGIST ASSISTANTS                                                                             
SPONSOR(S): LABOR & COMMERCE                                                                                                    
                                                                                                                                
03/17/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/17/04       (S)       L&C, FIN                                                                                               
04/01/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
04/01/04       (S)       Moved SB 365 Out of Committee                                                                          
04/01/04       (S)       MINUTE(L&C)                                                                                            
04/02/04       (S)       L&C RPT 3DP 1NR                                                                                        
04/02/04       (S)       DP: BUNDE, SEEKINS, DAVIS; NR: FRENCH                                                                  
04/16/04       (S)       FIN RPT CS 3DP 1NR           SAME TITLE                                                                
04/16/04       (S)       DP: BUNDE, HOFFMAN, STEVENS B;                                                                         
04/16/04       (S)       NR: OLSON                                                                                              
04/16/04       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/16/04       (S)       Moved CSSB 365(FIN) Out of Committee                                                                   
04/16/04       (S)       MINUTE(FIN)                                                                                            
04/26/04       (S)       TRANSMITTED TO (H)                                                                                     
04/26/04       (S)       VERSION: CSSB 365(FIN)                                                                                 
05/01/04       (H)       READ THE FIRST TIME - REFERRALS                                                                        
05/01/04       (H)       L&C, FIN                                                                                               
05/03/04       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                              
MICHAEL LESSMEIER, Lobbyist                                                                                                     
for State Farm Insurance                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Offered support for SB 357, but stated his                                                                 
disappointment that the bill does not address the problem of                                                                    
availability of insurance.                                                                                                      
                                                                                                                                
SENATOR CON BUNDE                                                                                                               
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   As chair  of the Senate Labor  and Commerce                                                               
Committee, sponsor of SB 357, introduced the bill.                                                                              
                                                                                                                                
LINDA HALL, Director                                                                                                            
Division of Insurance                                                                                                           
Department of Community & Economic Development                                                                                  
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Explained  the major points  of SB  357 and                                                               
answered questions.                                                                                                             
                                                                                                                                
JANE ALBERTS, Staff                                                                                                             
to Senator Con Bunde                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Introduced SB  389 and SB 365  as committee                                                               
aide  to  the  Senate  Labor  and  Commerce  Standing  Committee,                                                               
sponsor of the bills, and answered questions.                                                                                   
                                                                                                                                
MARK HICKEY, Lobbyist                                                                                                           
Aleut Enterprise Corporation                                                                                                    
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Explained SB 389 and answered questions.                                                                   
                                                                                                                                
CHUCK HARLAMERT                                                                                                                 
Juneau Section Chief                                                                                                            
Tax Division of Administrative Services                                                                                         
Department of Revenue                                                                                                           
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified during the discussion of SB 389.                                                                 
                                                                                                                                
LAURA YOUNG-CAMPBELL, Speech-Language Pathologist                                                                               
Matanuska-Susitna School District;                                                                                              
Member,                                                                                                                         
Alaska Speech-Language Hearing Association                                                                                      
Wasilla, Alaska                                                                                                                 
POSITION STATEMENT:   Testified during  the discussion of  SB 365                                                               
and answered questions.                                                                                                         
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 04-50, SIDE A                                                                                                            
Number 0001                                                                                                                     
                                                                                                                                
CHAIR TOM ANDERSON  called the House Labor  and Commerce Standing                                                             
Committee  meeting  to  order  at   4:30  p.m.    Representatives                                                               
Anderson, Dahlstrom, Lynn, and Rokeberg  were present at the call                                                               
to  order.   Representatives Gatto  and Crawford  arrived as  the                                                               
meeting was in progress.                                                                                                        
                                                                                                                                
^CONFIRMATION HEARING(S)                                                                                                      
                                                                                                                                
Number 0056                                                                                                                     
                                                                                                                                
CHAIR ANDERSON announced  that the first order  of business would                                                               
be   the  confirmation   hearings  for   14  of   the  governor's                                                               
appointments to various  boards as listed above  in the committee                                                               
calendar.  He noted that  each committee member was provided with                                                               
the names  and resumes for each  of the 14 appointments  and that                                                               
the  committee  made no  requests  of  the appointees  to  answer                                                               
questions before  the committee.   He  said he  took the  lack of                                                               
requests as there being no objections to the group.                                                                             
                                                                                                                                
CHAIR ANDERSON  requested that each member  sign the confirmation                                                               
committee report and noted that  each member's signature does not                                                               
reflect the member's vote during the joint floor session.                                                                       
                                                                                                                                
[The confirmation  of the 14  appointments was advanced  from the                                                               
House Labor and Commerce Standing Committee.]                                                                                   
                                                                                                                                
CHAIR ANDERSON noted that the  governor removed the name of James                                                               
Spaulding from the Alaska Labor Relations Agency appointment.                                                                   
                                                                                                                                
SB 357-INSURANCE                                                                                                              
                                                                                                                                
Number 0170                                                                                                                     
                                                                                                                                
CHAIR ANDERSON  announced that the  next order of  business would                                                               
be  CS FOR  SENATE BILL  NO. 357(FIN),  "An Act  relating to  the                                                               
regulation  of insurance,  insurance licenses,  qualifications of                                                               
insurance   producers,  surplus   lines,  fraud   investigations,                                                               
electronic  transactions, and  compliance  with  federal law  and                                                               
national standards; and providing for an effective date."                                                                       
                                                                                                                                
Number 0175                                                                                                                     
                                                                                                                                
MICHAEL  LESSMEIER, Lobbyist  for State  Farm Insurance,  offered                                                               
support for SB  357, but stated his disappointment  that the bill                                                               
does  not  address  the problem  of  availability  of  insurance.                                                               
Looking at  the cover  of the director's  65th annual  report, he                                                               
spoke  about  the  challenges  of the  lack  of  availability  of                                                               
insurance  products in  various  lines of  coverage ranging  from                                                               
workers' compensation  to contractors' general liability  to home                                                               
owners' coverage.  He reported that  Alaska is almost last in the                                                               
area of the  number of insurer groups  or nonaffiliated companies                                                               
with  at least  .1 percent  of  the 2002  direct written  premium                                                               
market  share.    "For  private   passenger  auto  we've  got  19                                                               
companies  in  this  state,  for homeowners  we've  got  15,"  he                                                               
related.  He said that this  problem would manifest itself in the                                                               
legislature  on  a piecemeal  basis  over  and over  again  until                                                               
something is done on a broader scale.                                                                                           
                                                                                                                                
MR. LESSMEIER referred to an  April 19 Auto Insurance Report that                                                               
focused on  Alaska, and he quoted  from page 5, "You  would think                                                               
that   a  state   with  no   size,  little   recent  profit   and                                                               
personalized, and  virtually no competitors, would  be anxious to                                                               
keep insurers  happy.   You would  also be wrong.   Alaska  has a                                                               
very  strict  prior-approval  regime   which  one  market  player                                                               
described as a  quagmire."  If you looked at  the market share of                                                               
who has  what insurance  in Alaska, it  would probably  scare you                                                               
even more, he said.  If  you looked at home owners' insurance you                                                               
would see  that State  Farm has  32.5 percent  of the  market and                                                               
Allstate has 30 percent  and then it drops to 5  percent.  If you                                                               
look at medical  malpractice you can see that  only two companies                                                               
are writing  that kind of insurance  in this state, he  said.  He                                                               
maintained that  it is  not healthy for  the insurance  market to                                                               
have those kinds of numbers.                                                                                                    
                                                                                                                                
Number 0458                                                                                                                     
                                                                                                                                
MR. LESSMEIER proposed that the state  get out of the business of                                                               
regulating insurance like many other  states have.  He quoted one                                                               
of the  leading experts  in this  area, Dr.  Phillip O'Connor(ph)                                                               
who  said,  "Virtually  every bit  of  reputable,  academic,  and                                                               
governmental  research conducted  over the  past 30  years either                                                               
concludes  that  reliance  on competitive  pricing  in  insurance                                                               
produces  an  appreciable,  tangible,  consumer  benefits.    The                                                               
essence of  the story is that  we have a level  of consensus rare                                                               
in the social sciences and studies of government policy."                                                                       
                                                                                                                                
MR. LESSMEIER  noted that  he has  drafted a  proposed amendment,                                                               
labeled  I.4,  that  was  worked   on  with  the  [Department  of                                                               
Community  & Economic  Development], Division  of Insurance,  but                                                               
was not  completely finished.  He  said he hopes to  work more on                                                               
it  over  the summer  and  make  progress  in  three areas.    He                                                               
proposed  to go  from  prior  approval to  "use  and file"  where                                                               
insurers are allowed to compete,  and which has been successfully                                                               
done  in  several states,  leading  to  more stable  markets  and                                                               
better prices.   He  said that  one of the  keys is  much greater                                                               
availability.  The  second proposal is to go to  a "use and file"                                                               
system for  forms, as well.   That would  open up the  market, he                                                               
opined.  Consumers  need protection in market  conduct, in claims                                                               
and in solvency,  but not in price, he explained.   The third fix                                                               
is a  self-critical analysis privilege,  which was  introduced by                                                               
then-Senator Taylor several years ago,  he said.  He concluded by                                                               
saying that he  hopes to find a solution to  this problem by next                                                               
year.                                                                                                                           
                                                                                                                                
CHAIR ANDERSON  thanked Mr. Lessmeier  for his testimony  and for                                                               
deferring his amendment until next session.                                                                                     
                                                                                                                                
Number 0731                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  said  that  no  one  had  brought  this                                                               
[issue] to  his attention prior  to the session and  he suggested                                                               
that it is  really important for Mr. Lessmeier  and other members                                                               
of  the  [insurance]  industry  to work  during  the  interim  to                                                               
educate legislators  about proposed remedial legislation  such as                                                               
this.    He  also  brought  up   a  concern  about  the  lack  of                                                               
availability of homeowners'  insurance and how it  related to the                                                               
recent  mold issue.   He  asked Mr.  Lessmeier to  speak to  that                                                               
problem.                                                                                                                        
                                                                                                                                
MR. LESSMEIER  said that  there was an  Allstate filing  for mold                                                               
exclusion  which  was  not  approved, and  which  resulted  in  a                                                               
moratorium  on homeowners'  policies.   He emphasized  that there                                                               
are going  to be even  more problems  if the market  situation is                                                               
not improved in terms of the dominance of two companies.                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG related that  the lack of availability of                                                               
homeowners'  policies is  a national  problem, which  has had  an                                                               
impact on the Alaskan market and needs to be addressed.                                                                         
                                                                                                                                
Number 0980                                                                                                                     
                                                                                                                                
SENATOR  CON BUNDE,  Alaska State  Legislature, as  chair of  the                                                               
Senate  Labor   and  Commerce  Committee,  sponsor   of  SB  357,                                                               
introduced  the bill.   He  said the  bill is  by request  of the                                                               
administration  and  has  some  interesting,  esoteric  questions                                                               
about insurance in it.                                                                                                          
                                                                                                                                
Number 0989                                                                                                                     
                                                                                                                                
LINDA  HALL,  Director,  Division  of  Insurance,  Department  of                                                               
Community &  Economic Development, explained the  major points of                                                               
SB 357.  She began by  thanking Mr. Lessmeier for waiting to make                                                               
his amendment.  She  said that changes do need to  be made in the                                                               
marketplace and  in the regulatory  system, and that she  is very                                                               
much in  favor of looking  at something else besides  the current                                                               
prior approval  system.   Alaska is  one of  the very  few states                                                               
left that does  prior approval for rates, she added.   She stated                                                               
her  commitment to  working over  the interim  toward a  solution                                                               
agreeable to  all parties involved.   She agreed that there  is a                                                               
need for more markets.                                                                                                          
                                                                                                                                
MS. HALL  noted that the  Allstate mold issue has  been finalized                                                               
and that it  does point out some  of the types of  issues "we get                                                               
into."   She said she  is concerned about the  homeowners' market                                                               
because of  the mold problems,  but also because of  water claims                                                               
issues and other unattractive  attributes associated with Alaska.                                                               
She stated her  commitment toward working with  industry toward a                                                               
major change in the system.                                                                                                     
                                                                                                                                
Number 1119                                                                                                                     
                                                                                                                                
MS.  HALL reported  that Version  I of  the bill  is the  [Senate                                                               
Finance committee substitute (CS)] and  it has six major areas of                                                               
proposed  changes, which  would ensure  that Alaska  statutes are                                                               
consistent with federal  law and with some of the  model Acts and                                                               
standards of the National  Association of Insurance Commissioners                                                               
(NAIC).    "Some  are required  for  our  accreditation  process,                                                               
others  have  come about  as  a  result  of industry  task  force                                                               
meetings,"  she said.   One  of the  major changes  is electronic                                                               
communication  and there  are  three sections  in  the bill  that                                                               
provide    for   various    communications   to    be   performed                                                               
electronically, she  reported.   She said communication  with the                                                               
public, for both insurers and licensees, is being improved.                                                                     
                                                                                                                                
MS. HALL  explained that the second  area of the bill  deals with                                                               
late  tax  payments.    There   are  four  sections  that  revise                                                               
penalties for late  payments and that make the  tax statutes more                                                               
consistent with the  Department of Revenue.   Currently, there is                                                               
a $100-a-day  late penalty for  late taxes,  or 25 percent.   "If                                                               
you're a day late, you pay 25  percent of your tax premium.  That                                                               
seemed excessive," she  related.  It also adds  a $10,000 penalty                                                               
for willful late taxes that did not exist before, she said.                                                                     
                                                                                                                                
MS.  HALL reported  that  the major  changes  in the  reinsurance                                                               
section of  the bill  is the  most technical  piece of  the bill.                                                               
She explained:                                                                                                                  
                                                                                                                                
      Reinsurance is the insurance insurance companies buy                                                                      
      to take part of the risk away from their capital and                                                                      
     surplus.  We  have a couple sections  here that require                                                                    
     insurance -  and one  of the changes  that was  done in                                                                    
     the Senate  Labor and Commerce [Committee]  was to make                                                                    
     reinsurance  contracts  available  to the  Division  of                                                                    
     Insurance.    We  had asked  originally  to  have  them                                                                    
     approved by  us - that  was not very acceptable  and we                                                                    
     understood that  - so we  are asking, however,  that we                                                                    
     be  able  to have  a  signed  copy of  the  reinsurance                                                                    
     contracts.                                                                                                                 
                                                                                                                                
Number 1236                                                                                                                     
                                                                                                                                
MS. HALL reported  that the fourth major change [in  the bill] is                                                               
in the licensing  sections and is done to  make Alaska consistent                                                               
with the NAIC Producer Licensing Model  Act.  "We have added crop                                                               
[insurance] licenses, we have  eliminated trainee licenses, we've                                                               
tried to remove some barriers  for people to become licensed, and                                                               
we're requiring  that surplus lines  brokers be  licensed, either                                                               
as producers or as managing general agents," she said.                                                                          
                                                                                                                                
MS.  HALL explained  that the  fifth  area of  change deals  with                                                               
surplus  lines.    "Last  summer  we convened  a  task  force  of                                                               
industry  representatives and  worked through  our surplus  lines                                                               
statutes and  regulations to determine  what really works  in our                                                               
marketplace to make it more  efficient, to make it reflect actual                                                               
practices,"  she  said.   One  of  the  changes is  an  emergency                                                               
provision that would allow for  the placement of health insurance                                                               
in a  surplus lines market  in cases where it  is found to  be in                                                               
the  best interest  of  the  public, she  explained.    It was  a                                                               
suggestion  from Washington,  which suffered  a health  insurance                                                               
crisis a  few years ago.   She  termed it a  "cautionary measure"                                                               
and said that  there are standards that have to  be met before it                                                               
could occur.                                                                                                                    
                                                                                                                                
MS.  HALL continued  to say  that there  are changes  to document                                                               
requirements  in Section  33,  and  responsibilities for  surplus                                                               
lines placements have been added for producing brokers.                                                                         
                                                                                                                                
Number 1318                                                                                                                     
                                                                                                                                
MS. HALL pointed out that the  sixth area of change is fraudulent                                                               
activity.    "Section 41  of  the  bill  provides that  a  person                                                               
involved in the prevention and  detection of fraudulent insurance                                                               
act would not be subject to  civil liability when filing a report                                                               
or  when  furnishing  information   to  others  involved  in  the                                                               
prevention  and  detection  of  fraudulent  insurance  act,"  she                                                               
explained.  It  allows the fraud department of insurer  A to talk                                                               
to  the fraud  department for  insurer B,  she said.   There  are                                                               
frequently  multiple insurance  companies  involved  in fraud  in                                                               
insurance.   "We  would like  them  to be  able to  talk to  each                                                               
other.  Currently they can only talk  to us," she said.  This was                                                               
the number one request of the chief investigator, she added.                                                                    
                                                                                                                                
MS. HALL  continued to discuss the  changes in the bill.   In the                                                               
Senate  Finance CS,  in Section  2,  [paragraph 2]  an "and"  was                                                               
changed to  an "or"  with the  intent being that  any one  of the                                                               
criteria  in  this  section  could make  a  contract  invalid  in                                                               
Alaska.                                                                                                                         
                                                                                                                                
Number 1412                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  disclosed that one  of his daughters  is the                                                               
vice  president  of the  Reinsurance  Association  of America  in                                                               
Washington, DC.                                                                                                                 
                                                                                                                                
CHAIR ANDERSON asked that Representative  Lynn still vote on this                                                               
bill.                                                                                                                           
                                                                                                                                
Number 1437                                                                                                                     
                                                                                                                                
CHAIR ANDERSON moved to adopt Amendment 1, labeled 23-                                                                          
LS1684\I.5, Bullock, 4/27/04.                                                                                                   
                                                                                                                                
REPRESENTATIVE DAHLSTROM objected for discussion purposes.                                                                      
                                                                                                                                
MS. HALL explained  that one of the problems in  the market today                                                               
is that  the assigned risk pool  has lost money for  at least the                                                               
last six years.  Five of  those years Alaska had the highest loss                                                               
of  any state  in  the  country, she  reported.    That loss  has                                                               
contributed to making Alaska an  unattractive market for workers'                                                               
compensation insurers.   [Amendment  1] is a  proactive statement                                                               
that would  require that  the assigned risk  pool would  be self-                                                               
funding during any consecutive three-year  period, she said.  "We                                                               
feel strongly that  the assigned risk pool  should support itself                                                               
and not be subsidized by insurers," she concluded.                                                                              
                                                                                                                                
REPRESENTATIVE ROKEBERG asked if  the high-risk pool is currently                                                               
subsidized  by   other  carriers  who  participate   in  workers'                                                               
compensation.                                                                                                                   
                                                                                                                                
MS.  HALL replied  this  is  correct.   They  pay the  difference                                                               
between  the  cost of  claims  and  the premiums  collected,  she                                                               
added.                                                                                                                          
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked  if the  premiums  collected  are                                                               
based on rates established by the [Division of Insurance].                                                                      
                                                                                                                                
MS.  HALL said  it  is  ultimately approved  by  the Division  of                                                               
Insurance.                                                                                                                      
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  if the  [new] language  will give                                                               
the [Division of  Insurance] the flexibility over time  to try to                                                               
close the gap.                                                                                                                  
                                                                                                                                
MS.  HALL said  yes.   In the  worker's compensation  reform bill                                                               
there is a provision that  would eliminate the current 25 percent                                                               
statutory  cap on  the differential  between voluntary  rates and                                                               
rates  in the  assigned-risk  pool,  she explained.    This is  a                                                               
proactive way of stating the pool  needs to be self-funding.  The                                                               
regulations currently say it should be self-funding, she added.                                                                 
                                                                                                                                
REPRESENTATIVE ROKEBERG  inquired if there will  be two different                                                               
statutes if the other bills don't pass.                                                                                         
                                                                                                                                
MS. HALL said that there would be  a 25 percent cap in that case,                                                               
which would make this impossible to do.                                                                                         
                                                                                                                                
REPRESENTATIVE ROKEBERG said that there  would be two statutes at                                                               
odds with each other.                                                                                                           
                                                                                                                                
MS. HALL said she didn't know it  they would be at odds with each                                                               
other, but  it would prevent  the full  intent of this  bill from                                                               
being implemented.                                                                                                              
                                                                                                                                
REPRESENTATIVE ROKEBERG asked how much more  has to be paid for a                                                               
person to be in the assigned-risk pool.                                                                                         
                                                                                                                                
Number 1586                                                                                                                     
                                                                                                                                
MS. HALL responded that currently  there is an abnormal number of                                                               
small policies.   The average  premium in the  assigned-risk pool                                                               
in the  under $10,000  premium is  $864, she  said.   The average                                                               
claim  size in  Alaska today  is in  excess of  $19,000, so  when                                                               
there is  an $800 policy  average and  a $19,000 claim,  it takes                                                               
roughly  8,000 policies  with  a premium  of  less than  $10,000.                                                               
That $3,000  exemption from the  25 percent surcharge is  part of                                                               
what has created this gap, she said.                                                                                            
                                                                                                                                
REPRESENTATIVE ROKEBERG  noted that  the smaller premiums  end up                                                               
being more subsidized.                                                                                                          
                                                                                                                                
Number 1638                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM removed her objection to Amendment 1.                                                                  
                                                                                                                                
[Amendment 1 was treated as adopted.]                                                                                           
                                                                                                                                
Number 1646                                                                                                                     
                                                                                                                                
CHAIR  ANDERSON   moved  to  adopt   Amendment  2,   labeled  23-                                                               
LS1684\I.7, Bullock, 5/3/04.                                                                                                    
                                                                                                                                
REPRESENTATIVE DAHLSTROM objected for discussion purposes.                                                                      
                                                                                                                                
MS. HALL explained that Amendment  2 will alleviate a problem due                                                               
to  insolvencies.    Currently,  the  difference  between  claims                                                               
collected  and claims  paid  out is  assessed  back to  insurance                                                               
companies, she said.   That is not assessed  to policyholders, so                                                               
it  becomes a  direct  insurer obligation.    "When an  insurance                                                               
company  becomes   insolvent,  their   share  of  that   loss  is                                                               
reallocated among  those left standing,  so to speak,"  she said.                                                               
Amendment 2 would  require insurance companies who  have to brook                                                               
lost reserves for the assigned  risk pool, to collateralize those                                                               
with a deposit,  so when that insolvent insurer  cannot pay their                                                               
portion  of  the  assigned-risk   losses,  that  money  would  be                                                               
available for the guaranteed fund, she related.                                                                                 
                                                                                                                                
REPRESENTATIVE ROKEBERG asked how this  would have applied in the                                                               
Fremont situation.                                                                                                              
                                                                                                                                
MS. HALL said  that if [Amendment 2] had been  in place the money                                                               
would have been available to be drawn into the guaranteed fund.                                                                 
                                                                                                                                
REPRESENTATIVE ROKEBERG asked how much money that would be.                                                                     
                                                                                                                                
MS. HALL  replied, "We're  asking that the  full amount  of their                                                               
loss reserves be collateralized."                                                                                               
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  if that  would be  a disincentive                                                               
for new entries into the market.                                                                                                
                                                                                                                                
MS.  HALL  said,  "This  has  been a  vision  that  industry  has                                                               
supported and  put forward,  so I  don't see  it as  a detriment.                                                               
And we've  had wide  support.   In the work  comp reform  bill we                                                               
have  done  an  increased  deposit   already.    On  the  regular                                                               
voluntary market  this is  the comparable piece  of that  for the                                                               
assigned-risk  pool,  and I've  not  had  any insurer  object  to                                                               
this."                                                                                                                          
                                                                                                                                
REPRESENTATIVE ROKEBERG asked  if other states have  this type of                                                               
provision.                                                                                                                      
                                                                                                                                
MS.  HALL  said  no,  but NCCI  Holdings,  Inc.  who  administers                                                               
assigned-risk pools  is looking  very carefully  at this.   "They                                                               
currently have a  provision where if an  insurance company Amvest                                                               
rating drops  below an A-,  they start asking for  percentages to                                                               
be collateralized.   That has not been very  effective because by                                                               
the time  their Amvest  rating has dropped,  they don't  have any                                                               
money and it's difficult to collect  it."  She reported that NCCI                                                               
is looking at this idea on a national level.                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG asked if NAIC has a position on this.                                                                   
                                                                                                                                
MS. HALL said she has not seen anything from NAIC.                                                                              
                                                                                                                                
Number 1780                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD asked how the  deposits are still able to                                                               
be used.                                                                                                                        
                                                                                                                                
MS. HALL  replied, "They  can't physically use  the money.   They                                                               
can  count   for  that   for  part   of  their   capital  surplus                                                               
requirements.  The  money is there to be considered  as assets in                                                               
their financial  statements. ... We're  asking them to  take part                                                               
of their  capital and put it  in an account set  aside, [so] that                                                               
if  they  become  insolvent,  in  this  case,  State  of  Alaska,                                                               
Division of  Insurance, would have  first right to that  money as                                                               
opposed to their estate in an insolvency."                                                                                      
                                                                                                                                
REPRESENTATIVE CRAWFORD  said, "As  long as they're  in business,                                                               
they never get to use that again."                                                                                              
                                                                                                                                
MS. HALL  replied that they don't  get to physically have  use of                                                               
that money.   She pointed  out that they  have to keep  a certain                                                               
level of  surplus to be able  to "write business" and  this would                                                               
be included  in that surplus  count in a financial  accounting as                                                               
an asset.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  CRAWFORD said,  "So,  all we're  really doing  is                                                               
upping the amount of reserves that they have."                                                                                  
                                                                                                                                
MS. HALL said correct.                                                                                                          
                                                                                                                                
Number 1871                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG asked for  clarification on the assigned-                                                               
risk pool reserves.                                                                                                             
                                                                                                                                
MS.  HALL replied,  "Every quarter  NCCI,  as the  pool and  plan                                                               
administrator,  sends insurance  companies  a billing  - some  of                                                               
it's  cash,  and sometimes  -  always  -  there  is a  change  in                                                               
reserves, it can  either be up or down, and  if the reserves went                                                               
up, they would need to increase  their deposit.  So it's based on                                                               
just  the reserves  they're  required to  book  through the  plan                                                               
administrator, and their obligation to the assigned-risk pool."                                                                 
                                                                                                                                
REPRESENTATIVE ROKEBERG asked what that is based on.                                                                            
                                                                                                                                
MS. HALL replied,  "Market share.  If you have  50 percent market                                                               
share, you'd have 50 percent  of the loss reserve obligations for                                                               
the pool," she added.                                                                                                           
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked if  previously the  current amount                                                               
of the deposit was held in  [the insurer's] own balance sheet and                                                               
asset base rather than in an in-state bank.                                                                                     
                                                                                                                                
MS. HALL  said, "This  would be  able to be  used where  we can't                                                               
attach  - Fremont  assets, for  example ...  there's still  money                                                               
there - but we can't get that.   It's spread out among all of the                                                               
creditors, currently policyholders and  claimants, but this would                                                               
be a  special set-aside for  the insolvent  insurer's obligations                                                               
to the assigned-risk pool."                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM removed her objection to Amendment 2.                                                                  
                                                                                                                                
[Amendment 2 was treated as adopted.]                                                                                           
                                                                                                                                
Number 1942                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  moved  to   report  CSSB  357(FIN),  as                                                               
amended,  out of  committee with  individual recommendations  and                                                               
the accompanying  fiscal notes.   There  being no  objection, HCS                                                               
CSSB  357(L&C)  was  reported  from   House  Labor  and  Commerce                                                               
Standing Committee.                                                                                                             
                                                                                                                                
SB 389-CORP. CONVERSION TO LIMITED LIABILITY CO.                                                                              
                                                                                                                                
CHAIR ANDERSON  announced that the  next order of  business would                                                               
be SENATE  BILL NO. 389,  "An Act  relating to the  conversion of                                                               
certain   corporations  to   limited  liability   companies;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
Number 1978                                                                                                                     
                                                                                                                                
JANE  ALBERTS,   Staff  to  Senator   Con  Bunde,   Alaska  State                                                               
Legislature, presented  SB 389  as committee  aide to  the Senate                                                               
Labor  and  Commerce  Committee,  sponsor   of  the  bill.    She                                                               
explained that the bill was  introduced at the request of several                                                               
Alaska Native Corporations (ANCs).                                                                                              
                                                                                                                                
Number 2005                                                                                                                     
                                                                                                                                
MARK  HICKEY, Lobbyist,  Aleut Enterprise  Corporation, explained                                                               
that the bill is a housekeeping  measure and that a number of the                                                               
ANCs  support it.   He  said it  makes one  change.   Current law                                                               
allows  a  number of  business  entities  to convert  from  their                                                               
status  as a  business  entity  to that  of  a limited  liability                                                               
company.   Current  law  does not  include  corporations in  that                                                               
list,  and  the  bill  would   allow  a  corporation  that  is  a                                                               
subsidiary  to be  converted, which  ensures no  tax loss  to the                                                               
state, he  related.  He stated  that there is a  zero fiscal note                                                               
from  the  Department of  Revenue.    The  change could  be  done                                                               
without  this bill,  but it  would  be much  more cumbersome,  he                                                               
said.   He pointed out that  there are letters of  support in the                                                               
members' packets.                                                                                                               
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked if Title  10 is applicable  to all                                                               
corporations or just to ANCs.                                                                                                   
                                                                                                                                
MR.  HICKEY  said, "All  corporations."    He  noted that  it  is                                                               
especially applicable  to regional  corporations, but  the change                                                               
is  applicable  to  any  corporation  in  the  state  that  is  a                                                               
subsidiary.                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  if there  is a  witness from  the                                                               
Department of Revenue.                                                                                                          
                                                                                                                                
Number 2145                                                                                                                     
                                                                                                                                
CHUCK   HARLAMERT,  Juneau   Section  Chief,   Tax  Division   of                                                               
Administrative  Services,   Department  of   Revenue,  introduced                                                               
himself.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  ROKEBERG   asked  if  a  C-type   corporation  is                                                               
currently  able  to make  a  conversion  to a  limited  liability                                                               
company (LLC).                                                                                                                  
                                                                                                                                
MR. HARLAMERT replied that a  business could certainly reorganize                                                               
and become an LLC, but state law  does not allow it to change its                                                               
status from a corporation to an LLC.                                                                                            
                                                                                                                                
REPRESENTATIVE ROKEBERG asked if that is what the bill does.                                                                    
                                                                                                                                
MR. HARLAMERT replied that from his understanding, it does.                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG asked how it happens.                                                                                   
                                                                                                                                
MR. HARLAMERT said he assumes  that the company hires an attorney                                                               
to file [the new status] with the Department of Commerce.                                                                       
                                                                                                                                
Number 2208                                                                                                                     
                                                                                                                                
MR.  HICKEY referred  to  page 1,  lines 9-13,  [of  SB 389]  and                                                               
pointed  out that  that is  existing law,  which is  the list  in                                                               
Title 10 that  allows for a conversion  to a LLC.   Adding in the                                                               
change on the  top of page 2 would allow  corporations that are a                                                               
subsidiary  to  have  the  authority  to convert  to  a  LLC,  he                                                               
explained.  The Department of  Law and The Department of Economic                                                               
and Community Development helped to draft this change, he said.                                                                 
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked  if  it is  [subsection]  (j)  or                                                               
[subsection] (l).                                                                                                               
                                                                                                                                
MR. HICKEY said [subsection] (j).                                                                                               
                                                                                                                                
REPRESENTATIVE ROKEBERG said  it is only for  subsidiaries and is                                                               
not  a   "free  pass"  for   C-corporations  to  make   a  direct                                                               
conversion.                                                                                                                     
                                                                                                                                
CHAIR ANDERSON  said that  in the [Tax  Division] fiscal  note it                                                               
says:                                                                                                                           
                                                                                                                                
     Pursuant  to   federal  income   tax  law,   a  limited                                                                    
     liability  company ("LLC")  is  an entity  that is  not                                                                    
     automatically  classified   as  a  corporation.     The                                                                    
     default  classification   of  a   multimember  business                                                                    
     entity organized  as an  LLC is  a partnership  and the                                                                    
     default  classification  of  a single  member  business                                                                    
     entity  organized as  an LLC  is  a disregarded  entity                                                                    
     where the owner is the  taxpayer.  The LLC may instead,                                                                    
     however, elect to be taxed  as a corporation in lieu of                                                                    
     a default classification.                                                                                                  
                                                                                                                                
REPRESENTATIVE  ROKEBERG  stated that  public  policy  is to  not                                                               
allow for a very quick conversion  from a C-corporation to an LLC                                                               
for tax reasons.                                                                                                                
                                                                                                                                
CHAIR ANDERSON said that is why  he read the fiscal note into the                                                               
record.  He  continued to read, "An LLC taxable  as a corporation                                                               
for  federal  income  tax  purposes  is  subject  to  the  Alaska                                                               
Corporation  Net Income  Tax  in  the same  manner  as any  other                                                               
corporation."  He  asked how the fear of changing  status for tax                                                               
reasons might be quelled.                                                                                                       
                                                                                                                                
Number 2302                                                                                                                     
                                                                                                                                
MR. HICKEY  said the  question also  came up  on the  other side.                                                               
"The tax  consequence at the  state level is zero.   We pay  - in                                                               
our  case we're  consolidated with  the parent  - we  pay at  the                                                               
parent ...  level which has  the obligation for  corporate income                                                               
tax based on earnings," he said.   The desire to become an LLC is                                                               
not a tax  issue, but is because  it is cheaper to  operate and a                                                               
full board will  not be required.  "It's also  a governance issue                                                               
-  the SBA  (Small Business  Association) rules  required a  fair                                                               
amount of arm's  length arrangement with the  subsidiary board so                                                               
we could  not, in the  past, have  members from our  parent board                                                               
sit  on the  board of  subsidiaries," he  explained.   "This will                                                               
give us tighter control," he said.                                                                                              
                                                                                                                                
TAPE 04-50, SIDE B                                                                                                            
Number 2327                                                                                                                     
                                                                                                                                
MR. HICKEY  continued to say that  the bill was designed  so that                                                               
there is no state tax consequence,  which would not have been the                                                               
case if the bill had been broadened to just "corporations".                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG said  he assumes  one reason  Mr. Hickey                                                               
would  like to  make  this  change is  if  he  has joint  venture                                                               
operations then  it would  be easier  to form under  an LLC.   He                                                               
asked if that is correct.                                                                                                       
                                                                                                                                
MR. HICKEY replied,  "Well, we want to protect the  ability to do                                                               
joint venture  and that's why it's  by one or more  parent corps.                                                               
But the tax consequence with that  case will, based on your level                                                               
of ownership,  will accrue with  each corporation, so we  have 80                                                               
percent ownership, we'll have 80 percent."                                                                                      
                                                                                                                                
REPRESENTATIVE  ROKEBERG said  the point  he was  getting to  is,                                                               
"You're  actually not  going to  really be  doing that  as a  tax                                                               
avoidance method  for Alaska  corporate taxes  because ultimately                                                               
you'd  have  to  return  your  net profits  back  to  the  parent                                                               
corporation at  which time there'd  be a tax  ...."  He  asked if                                                               
that is correct.                                                                                                                
                                                                                                                                
                                                                                                                                
Number 2288                                                                                                                     
                                                                                                                                
MR.  HARLAMERT replied  that  the  LLC is  a  non-entity for  tax                                                               
purposes.   It's either going to  be treated as a  partnership or                                                               
the income  goes to the owners  as it's earned and  it's taxed as                                                               
it's earned.                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked if a class  C-corporation could be                                                               
an owner of an LLC.                                                                                                             
                                                                                                                                
MR. HARLAMERT  replied absolutely.   They  could still  elect tax                                                               
treatment of that LLC as a  partnership where they pay the tax on                                                               
the  income as  it's earned,  or to  treat it  as a  corporation.                                                               
Generally,  it would  be consolidated,  and the  same result,  he                                                               
added.                                                                                                                          
                                                                                                                                
Number 2250                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN moved to report  SB 389, Version 23-LS1923\D,                                                               
out  of   committee  with  individual  recommendations   and  the                                                               
accompanying fiscal notes.  There  being no objection, SB 389 was                                                               
reported from the House Labor and Commerce Standing Committee.                                                                  
                                                                                                                                
SB 365-SPEECH-LANGUAGE PATHOLOGIST ASSISTANTS                                                                                 
                                                                                                                                
CHAIR ANDERSON announced  that the final order  of business would                                                               
be the CS  FOR SENATE BILL NO. 365(FIN), "An  Act relating to the                                                               
regulation   of  speech-language   pathologist  assistants;   and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
Number 2229                                                                                                                     
                                                                                                                                
JANE  ALBERTS,   Staff  to  Senator   Con  Bunde,   Alaska  State                                                               
Legislature, presented  SB 365  as committee  aide to  the Senate                                                               
Labor  and  Commerce Standing  Committee,  sponsor  of the  bill.                                                               
This   bill    establishes   registration    of   speech-language                                                               
pathologist  assistants through  the  department of  occupational                                                               
licensing,   she   explained.     Currently,   speech   pathology                                                               
assistants (SLPAs) in  Alaska are not licensed  or regulated like                                                               
similar   professions  of   physical  and   occupational  therapy                                                               
assistants.    The  bill  outlines  qualifications  and  training                                                               
required to  be an  SLPA, their  scope of  practice, supervision,                                                               
and  continuing  education  requirements,   she  reported.    She                                                               
continued:                                                                                                                      
                                                                                                                                
     The  bill  will mandate  that  SLPAs  be regulated  and                                                                    
     supervised,   which  insures   that  the   consumer  is                                                                    
     receiving  appropriate language  services.   This  will                                                                    
     increase  the frequency  of services  to clients  while                                                                    
     maintaining  service quality.    The use  of the  SLPAs                                                                    
     will be crucial in rural  and remote regions in Alaska,                                                                    
     and may  be some  of the only  ways that  folks needing                                                                    
     those  services in  these  areas will  be  able to  get                                                                    
     their  services, and  that's through  the use  of these                                                                    
     assistants.                                                                                                                
                                                                                                                                
     There's  currently a  shortage  of  qualified SLPAs  in                                                                    
     Alaska.  I  believe there's about 230  currently in the                                                                    
     state.  This bill  will give credentials and supervised                                                                    
     authority to  SLPAs to administer specific  services to                                                                    
     clients once  they are reviewed by  the speech-language                                                                    
     pathologist.  It must be  made clear, however, that the                                                                    
     use of  an SLPA is not  meant to replace the  work of a                                                                    
     speech-language  pathologist,   but  to   extend  their                                                                    
     services.   Currently  SLPAs are  licensed through  the                                                                    
     Department of Economic Development.                                                                                        
                                                                                                                                
     There were a  couple changes made in  Senate Finance to                                                                    
     this  bill that  were technical  language changes  that                                                                    
     clarified that the SLPAs could  not conduct feeding and                                                                    
     swallowing screenings.   Apparently, in  this industry,                                                                    
     that's very  technical screening that can  only be done                                                                    
     by  a licensed  speech  pathologist.   There were  four                                                                    
     technical changes made in Senate Finance to this bill.                                                                     
                                                                                                                                
MS.  ALBERTS noted  that  the  fiscal note  is  fee-based with  a                                                               
biennial registration fee of approximately $133.                                                                                
                                                                                                                                
Number 2093                                                                                                                     
                                                                                                                                
LAURA  YOUNG-CAMPBELL,  Speech-Language  Pathologist,  Matanuska-                                                               
Susitna School  District; Member, Alaska  Speech-Language Hearing                                                               
Association,   testified   that   her  workload   has   increased                                                               
significantly  due  to  paperwork  and other  duties  created  by                                                               
Individuals with  Disabilities Education Act (IDEA)  and No Child                                                               
Left Behind,  and that has caused  her to have less  time to work                                                               
with  students.   An  assistant would  be able  to  help take  on                                                               
duties  such   as  scheduling  meetings  with   parents,  provide                                                               
prescribed  therapy, and  follow  a treatment  plan for  students                                                               
with disabilities, she  explained.  An assistant  would allow the                                                               
students to complete their Individual  Education Plan (IEP) goals                                                               
faster and allow  them to return to the  classroom and experience                                                               
academic success.   An assistant would  also be a cost  saving to                                                               
the school district and to the  state when the time frame for the                                                               
treatment plan is cut down, she  opined.  An assistant would also                                                               
enable smaller teaching groups,  which, according to the National                                                               
American Speech-Language-Hearing  Association, allows  for faster                                                               
progress by children.  The SLPA would be supervised by a speech-                                                                
language pathologist and would have  a specific scope of practice                                                               
to follow, she concluded.                                                                                                       
                                                                                                                                
Number 2023                                                                                                                     
                                                                                                                                
REPRESENTATIVE GATTO thanked Ms. Campbell  for the work she does.                                                               
He pointed  out that  his minor  was in  speech pathology  and he                                                               
said he understands  the amount of paperwork that  is involved in                                                               
her job.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked if  there  is  an existing  board                                                               
which would supervise the SLPAs.                                                                                                
                                                                                                                                
MS.  YOUNG-CAMPBELL   replied  that  it  would   be  through  the                                                               
[Division]  of Occupational  Licensing, [Department  of Community                                                               
and Economic Development].                                                                                                      
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked if  there is  a board  for speech-                                                               
language pathologists.                                                                                                          
                                                                                                                                
MS. YOUNG-CAMPBELL replied no.                                                                                                  
                                                                                                                                
Number 1984                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked if  speech-language  pathologists                                                               
are currently licensed under occupational licensing.                                                                            
                                                                                                                                
MS.  YOUNG-CAMPBELL said  that some  are  [licensed] through  the                                                               
[Division]  of Occupational  Licensing  and  some are  [licensed]                                                               
through the Department of Education.                                                                                            
                                                                                                                                
CHAIR  ANDERSON asked  if  this bill  would  bring all  licensing                                                               
under one statute.                                                                                                              
                                                                                                                                
MS. YOUNG-CAMPBELL replied that it  is only for assistants.  Both                                                               
the  Department of  Education and  the  Division of  Occupational                                                               
Licensing  would   follow  the  bill's  guidelines   when  hiring                                                               
[SLPAs], she explained.                                                                                                         
                                                                                                                                
REPRESENTATIVE ROKEBERG asked if this bill  is needed to set up a                                                               
competency level for SLPAs.                                                                                                     
                                                                                                                                
MS. YOUNG-CAMPBELL said yes.                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  if there  is a  minimum level  of                                                               
education required.                                                                                                             
                                                                                                                                
MS. YOUNG-CAMPBELL  replied that  Prince William  Sound Community                                                               
College has a  two-year SLPA program and 100  hours of supervised                                                               
clinical  practice, which  fall under  the guidelines  of the  No                                                               
Child Left Behind Act.                                                                                                          
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked if  a person would  have to  go to                                                               
Valdez to get this degree.                                                                                                      
                                                                                                                                
MS. YOUNG-CAMPBELL  said that it  is a  distance-delivery program                                                               
and it is currently the only program in Alaska.                                                                                 
                                                                                                                                
Number 1863                                                                                                                     
                                                                                                                                
CHAIR ANDERSON closed public testimony.                                                                                         
                                                                                                                                
Number 1855                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM  moved to report CSSB  365(FIN), Version                                                               
23-LS0540\S,  out of  committee  with individual  recommendations                                                               
and the  accompanying fiscal  notes.   There being  no objection,                                                               
CSSB  365(FIN) was  reported from  the House  Labor and  Commerce                                                               
Standing Committee.                                                                                                             
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Labor and  Commerce Standing Committee  meeting was  adjourned at                                                               
5:30 p.m.                                                                                                                       

Document Name Date/Time Subjects