Legislature(2013 - 2014)BARNES 124

03/24/2014 03:15 PM LABOR & COMMERCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 230 AIDEA BONDS FOR PROCESSING FACILITIES TELECONFERENCED
Heard & Held
+= HB 316 WORKERS' COMPENSATION MEDICAL FEES TELECONFERENCED
Heard & Held
+= HB 60 UNIFORM REAL PROPERTY TRANSFERS ON DEATH TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                         March 24, 2014                                                                                         
                           3:28 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Kurt Olson, Chair                                                                                                
Representative Lora Reinbold, Vice Chair                                                                                        
Representative Mike Chenault                                                                                                    
Representative Bob Herron                                                                                                       
Representative Dan Saddler                                                                                                      
Representative Andy Josephson                                                                                                   
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Charisse Millett                                                                                                 
Representative Craig Johnson                                                                                                    
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 230                                                                                                              
"An  Act allowing  the Alaska  Industrial  Development and  Export                                                              
Authority to  issue bonds for an  oil or gas  processing facility;                                                              
and  creating  the oil  and  gas  infrastructure fund  to  finance                                                              
construction  or   improvement  of   an  oil  or   gas  processing                                                              
facility."                                                                                                                      
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 316                                                                                                              
"An  Act  relating  to  workers'  compensation  fees  for  medical                                                              
treatment   and  services;  relating   to  workers'   compensation                                                              
regulations; and providing for an effective date."                                                                              
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 60                                                                                                               
"An  Act  adopting  and relating  to  the  Uniform  Real  Property                                                              
Transfer on Death Act."                                                                                                         
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 230                                                                                                                  
SHORT TITLE: AIDEA BONDS FOR PROCESSING FACILITIES                                                                              
SPONSOR(s): REPRESENTATIVE(s) SEATON                                                                                            
                                                                                                                                
01/21/14       (H)       PREFILE RELEASED 1/10/14                                                                               
01/21/14       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/21/14       (H)       L&C, FIN                                                                                               
02/21/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
02/21/14       (H)       Heard & Held                                                                                           
02/21/14       (H)       MINUTE(L&C)                                                                                            
03/14/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/14/14       (H)       Heard & Held                                                                                           
03/14/14       (H)       MINUTE(L&C)                                                                                            
03/24/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 316                                                                                                                  
SHORT TITLE: WORKERS' COMPENSATION MEDICAL FEES                                                                                 
SPONSOR(s): LABOR & COMMERCE                                                                                                    
                                                                                                                                
02/19/14       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/19/14       (H)       L&C                                                                                                    
03/07/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/07/14       (H)       Heard & Held                                                                                           
03/07/14       (H)       MINUTE(L&C)                                                                                            
03/10/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/10/14       (H)       Heard & Held                                                                                           
03/10/14       (H)       MINUTE(L&C)                                                                                            
03/14/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/14/14       (H)       Scheduled But Not Heard                                                                                
03/17/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/17/14       (H)       Heard & Held                                                                                           
03/17/14       (H)       MINUTE(L&C)                                                                                            
03/24/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 60                                                                                                                   
SHORT TITLE: UNIFORM REAL PROPERTY TRANSFERS ON DEATH                                                                           
SPONSOR(s): GRUENBERG                                                                                                           
                                                                                                                                
01/16/13       (H)       PREFILE RELEASED 1/11/13                                                                               
01/16/13       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/16/13       (H)       L&C, JUD                                                                                               
03/21/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/21/14       (H)       -- MEETING CANCELED --                                                                                 
03/24/14       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
LOUIS FLORA, Staff                                                                                                              
Representative Paul Seaton                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified during the discussion of HB 230.                                                               
                                                                                                                                
MATT FONDER, Director                                                                                                           
Anchorage Office; Tax Division                                                                                                  
Department of Revenue                                                                                                           
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified on HB 230.                                                                                     
                                                                                                                                
TED LEONARD, Executive Director                                                                                                 
Alaska Industrial Development & Export Authority (AIDEA)                                                                        
Department of Commerce, Community, & Economic Development                                                                       
(DCCED)                                                                                                                         
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Answered questions regarding HB 230.                                                                     
                                                                                                                                
ANNA LATHAM, Staff                                                                                                              
Representative Kurt Olson                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified on behalf of the sponsor, House                                                                
Labor & Commerce Committee Chair Kurt Olson.                                                                                    
                                                                                                                                
RICK TRAINI, Business Representative                                                                                            
Teamsters Local 959                                                                                                             
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 316.                                                               
                                                                                                                                
MICHAEL MONAGLE, Director                                                                                                       
Central Office                                                                                                                  
Division of Workers' Compensation                                                                                               
Department of Labor & Workforce Development (DLWD)                                                                              
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified and answered questions on HB 316.                                                              
                                                                                                                                
REPRESENTATIVE MAX GRUENBERG                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified as prime sponsor of HB 60.                                                                     
                                                                                                                                
BENJAMIN ORZESKE, Legal Counsel                                                                                                 
Uniform Law Commission for Real Property, Trust, and Estate Acts                                                                
National Conference of Commissioners on Uniform State Laws                                                                      
Chicago, Illinois                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 60.                                                                
                                                                                                                                
DEBORAH RANDALL, Attorney                                                                                                       
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 60.                                                                
                                                                                                                                
KEN HELANDER, Associate State Director                                                                                          
Legislative Advocacy                                                                                                            
AARP                                                                                                                            
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 60.                                                                           
                                                                                                                                
MARIE DARLIN, Chair                                                                                                             
Legislative Advocacy                                                                                                            
AARP                                                                                                                            
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in support of HB 60.                                                                           
                                                                                                                                
ERROL CHAMPION, Chair                                                                                                           
Alaska Association of Realtors, Inc.                                                                                            
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified during the discussion of HB 60.                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:28:36 PM                                                                                                                    
                                                                                                                                
CHAIR  KURT OLSON  called the  House Labor  and Commerce  Standing                                                            
Committee meeting  to order at 3:28 p.m.   Representatives Herron,                                                              
Reinbold, Josephson,  Saddler, and Olson were present  at the call                                                              
to order.  Representative  Chenault arrived as the  meeting was in                                                              
progress.                                                                                                                       
                                                                                                                                
          HB 230-AIDEA BONDS FOR PROCESSING FACILITIES                                                                      
                                                                                                                                
3:29:04 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  announced that the  first order of business  would be                                                              
HOUSE  BILL  NO.  230, "An  Act  allowing  the  Alaska  Industrial                                                              
Development  and Export  Authority to  issue bonds  for an  oil or                                                              
gas   processing  facility;   and   creating  the   oil  and   gas                                                              
infrastructure fund  to finance construction or improvement  of an                                                              
oil or gas processing facility."                                                                                                
                                                                                                                                
3:30:03 PM                                                                                                                    
                                                                                                                                
LOUIS  FLORA,  Staff, Representative  Paul  Seaton,  Alaska  State                                                              
Legislature,   stated  that   HB  230  would   allow  the   Alaska                                                              
Industrial Development  & Export Authority (AIDEA)  to issue bonds                                                              
for an  oil and gas  processing facility on  the North Slope.   It                                                              
would   also  create   an   oil   and  gas   processing   facility                                                              
infrastructure fund  to allow the legislature to  allocate funding                                                              
to the  facility.   He highlighted a  number of specific  findings                                                              
that  demonstrated   the  difficulty   of  some  of   the  smaller                                                              
operations on the  North Slope to access processing  facilities on                                                              
the North  Slope.   The intent  is to  increase oil throughput  in                                                              
the Trans-Alaska Pipeline System (TAPS) pipeline, he said.                                                                      
                                                                                                                                
3:31:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  REINBOLD  moved to  adopt  the proposed  committee                                                              
substitute  (CS)   for  HB   230,  labeled  28-LS1053\N,   Nauman,                                                              
3/17/14, as the working document [Version N].                                                                                   
                                                                                                                                
CHAIR OLSON objected for the purpose of discussion.                                                                             
                                                                                                                                
3:31:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER  referred to page 2, line  4, and suggested                                                              
inverting  "for"  and "allow"  such  that  it would  read,  "would                                                              
allow for new production ...."                                                                                                  
                                                                                                                                
MR. FLORA acknowledged the suggested change.                                                                                    
                                                                                                                                
3:32:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  asked  him to  identify  the  perceived                                                              
target or beneficiary of the bill.                                                                                              
                                                                                                                                
MR.  FLORA answered  that  the bill  is  not  intended for  anyone                                                              
specifically, but  it will generally  allow anyone  who approaches                                                              
AIDEA to hold  discussions on project financing.   He specifically                                                              
referred  to  page  2,  line  8,  paragraph  (6),  the  "findings"                                                              
language that  discusses access  issues.  More specifically,  this                                                              
language  would   remove  the  limit  on  bonding   authority  for                                                              
processing  facilities and  other  infrastructure  to allow  small                                                              
companies  without  capital  to  finance oil  and  gas  processing                                                              
facilities  to  move more  oil  from  new fields  and  essentially                                                              
reach out and expand oil and gas throughput.                                                                                    
                                                                                                                                
3:33:19 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON asked whether  he has discussed  maximum                                                              
credits and foregone revenue with the Department of Revenue.                                                                    
                                                                                                                                
MR. FLORA deferred to the Department of Revenue to answer.                                                                      
                                                                                                                                
3:33:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE REINBOLD  wondered why bonding is  necessary, since                                                              
a good project would be able to obtain private funding.                                                                         
                                                                                                                                
MR. FLORA  answered that the bill  is being offered as  a concept,                                                              
which  was previously  adopted  in  SB 21  as  part  of a  broader                                                              
package to  increase throughput  in the TAPS  and provide  a range                                                              
of incentives.                                                                                                                  
                                                                                                                                
3:34:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  REINBOLD  offered  her  belief  the  only  way  to                                                              
obtain additional throughput is by drilling for more oil.                                                                       
                                                                                                                                
REPRESENTATIVE   CHENAULT  commented   that   throughput  can   be                                                              
increased for TAPS  without drilling any new wells.   He suggested                                                              
that the current  problem of constriction in the  process facility                                                              
is that  the pipeline  was designed  to transport  more crude  oil                                                              
than  water.   However, today's  oil  wells are  putting out  more                                                              
water and  gas than crude oil.   Thus, the production  facility is                                                              
limited by throughput  for each category.  Again,  the wells today                                                              
produce  more  water and  gas,  which  limits  the amount  of  oil                                                              
production.   For example, a well  might put out 1,000  barrels of                                                              
water, oil,  and gas  per day, he  said.  It  makes more  sense to                                                              
run that  capacity through the pipeline  rather than to  have five                                                              
other  wells that  might  produce  300 barrels  of  oil, with  the                                                              
remaining  production being  gas and  water.   He noted that  this                                                              
can  be remedied  and configured;  however, that  process is  very                                                              
expensive.    He  addded  that  throughput  can  be  increased  by                                                              
expanding   the  production   facility   or   by  providing   more                                                              
opportunities, which  is what HB 230 proposes  by building another                                                              
production facility to allow others to input oil.                                                                               
                                                                                                                                
3:36:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  understood  the  bill  would  allow  an                                                              
additional  $200  million  increase  in the  AIDEA  allowance  for                                                              
maximum  bond  capacity.    He asked  whether  the  Department  of                                                              
Revenue has an idea of the maximum dollar credit under the bill.                                                                
                                                                                                                                
3:37:31 PM                                                                                                                    
                                                                                                                                
MATT   FONDER,   Director,   Anchorage   Office,   Tax   Division,                                                              
Department of  Revenue (DOR), answered  that the  division doesn't                                                              
"have a good  handle on that"  since it is difficult  to determine                                                              
the number of  taxpayers who might take advantage  of this credit.                                                              
It's  also  important to  note  that  any  taxpayer will  need  to                                                              
invest a significant  amount of money to utilize the  credit.  The                                                              
credit amount  under the  bill is  the "lesser  of 10  percent" or                                                              
$10  million.   Therefore,  the  taxpayer  would have  90  percent                                                              
"skin in the  game" so the bill  will help, but it will  not offer                                                              
much of an incentive  to move forward with the project.   Thus, he                                                              
did not  believe it would  be the "deal  breaker," but it  is hard                                                              
to tell how many taxpayers will take advantage of the credit.                                                                   
                                                                                                                                
3:38:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   JOSEPHSON   asked  him   to   predict  what   new                                                              
facilities would be built with the AIDEA bonding.                                                                               
                                                                                                                                
MR.  FONDER  said   he  really  didn't  know;   the  legislature's                                                              
"crystal ball" is probably just as good as his.                                                                                 
                                                                                                                                
REPRESENTATIVE  CHENAULT asked  whether any  companies have  asked                                                              
for this type of enhancement for a project.                                                                                     
                                                                                                                                
3:39:32 PM                                                                                                                    
                                                                                                                                
TED LEONARD, Executive  Director, Alaska Industrial  Development &                                                              
Export  Authority (AIDEA),  Department of  Commerce, Community,  &                                                              
Economic Development,  answered yes;  AIDEA has been  working with                                                              
Brooks Range  Petroleum Corporation, who  would like to  finance a                                                              
production  facility to  develop  the Mustang  Oil  Field [of  the                                                              
southern Miluveach Unit].                                                                                                       
                                                                                                                                
3:40:04 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER  asked for  a  general assessment  of  the                                                              
impact of an  additional $200 million in lending  authority and if                                                              
it  will  affect  AIDEA's  interest   rates,  AIDEA's  ability  to                                                              
finance  other projects,  or Alaska's  bond rating.   He asked  if                                                              
this process  would stand  alone or  if it  would have  any ripple                                                              
effects.                                                                                                                        
                                                                                                                                
MR. LEONARD answered  that AIDEA believes this  financing will not                                                              
affect its capacity  to finance other projects or its  rating.  He                                                              
explained that  these bonds will  be AIDEA bonds and  could either                                                              
be general  obligation  (GO) bonds  or revenue  bonds.  It  should                                                              
not affect  the state's  rating since the  project will  be funded                                                              
by  revenue generated  by  the project  or  will  be supported  by                                                              
AIDEA's assets,  but none of the  state's assets would  be pledged                                                              
for a project under this bond authorization.                                                                                    
                                                                                                                                
3:41:27 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER  recalled   discussions  on  the  possible                                                              
liquefied  natural gas  (LNG) transmission  line  with respect  to                                                              
the state's  general debt-to-equity ratio  such that 8  percent of                                                              
the general  fund principal  would be allowed.   He  asked whether                                                              
an informal  policy exists  in terms of  what AIDEA  cannot exceed                                                              
in terms of GO bonding.                                                                                                         
                                                                                                                                
MR. LEONARD  answered yes;  the rule of  thumb under  the capacity                                                              
model  is $500  million of  bonding  capacity.   He reported  that                                                              
AIDEA  has  approximately  $70 million  in  outstanding  bonds  so                                                              
AIDEA has significant  capacity available.  In  addition, it would                                                              
also depend on the  type of bond, for example,  revenue bonds will                                                              
not affect  AIDEA's  capacity.   Overall, it  would depend  on the                                                              
individual  project whether  AIDEA will  want to  use its  general                                                              
bonding  capacity or  if  it will  issue  revenue bonds;  however,                                                              
AIDEA has the  capacity to issue  up to $200 million in  bonds for                                                              
these types of  facilities.  Again, just because  AIDEA would have                                                              
the  bonding  authority  doesn't  mean  it will  use  all  of  its                                                              
authority.   He indicated  that AIDEA  will consider its  capacity                                                              
for  each and  every  project  under  this bond  authorization  to                                                              
ensure  AIDEA  has  sufficient  capacity  and  that  it  will  not                                                              
adversely  affect AIDEA's  ability  to fund  other  projects.   He                                                              
assured members  that AIDEA undergoes  the same capacity  analysis                                                              
on every project it considers in terms of bond financing.                                                                       
                                                                                                                                
3:43:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER  asked  how much  Brooks  Range  Petroleum                                                              
Corporation would need for its processing facility.                                                                             
                                                                                                                                
MR. LEONARD was offline.                                                                                                        
                                                                                                                                
CHAIR  OLSON,  after  first  determining  no one  else  wished  to                                                              
testify, closed public testimony on HB 230.                                                                                     
                                                                                                                                
[HB 230 was held over.]                                                                                                         
                                                                                                                                
3:45:21 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
           HB 316-WORKERS' COMPENSATION MEDICAL FEES                                                                        
                                                                                                                                
3:46:02 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  announced that  the next order  of business  would be                                                              
HOUSE  BILL NO.  316, "An  Act relating  to workers'  compensation                                                              
fees  for medical  treatment and  services;  relating to  workers'                                                              
compensation regulations;  and providing  for an effective  date."                                                              
[Version O was before the committee.]                                                                                           
                                                                                                                                
3:46:28 PM                                                                                                                    
                                                                                                                                
ANNA  LATHAM,  Staff,  Representative  Kurt  Olson,  Alaska  State                                                              
Legislature,  stated that  HB 316  changes the  fee schedules  for                                                              
workers'  compensation from  a  usual, customary,  and  reasonable                                                              
schedule (UCR),  which the state has  used for the past  10 years,                                                              
to  a  resource-based  relative   value  scale  (RBRVS)  based  on                                                              
Centers  for Medicaid  (CMS)  and Medicare  services  rate with  a                                                              
conversion  factor  that is  set  by workers'  compensation  board                                                              
(WCB)  under  the  advisement  of   the  medical  services  review                                                              
committee (MSRC).                                                                                                               
                                                                                                                                
3:47:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  recalled 90 percent of  the UCR schedule                                                              
has been discussed.  He asked for her view of the 90 percent.                                                                   
                                                                                                                                
MS. LATHAM  said that  the target  and goal  of HB  316 is  to set                                                              
fees  at a  reasonable and  fair  amount that  allows the  medical                                                              
community  to make a  fair profit,  but to  align fees  with group                                                              
health and  not allow  specific procedures to  be inflated  at the                                                              
400 to 800 percentile.                                                                                                          
                                                                                                                                
CHAIR OLSON  referred to members'  packets to a comparison  of the                                                              
top  25   workers'  compensation   procedures  in  comparison   to                                                              
Washington and other  states.  He noted that there  wouldn't be an                                                              
easy  answer.   He recalled  that  Alaska's costs  are over  1,000                                                              
percent for some workers' compensation medical procedures.                                                                      
                                                                                                                                
3:48:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON recalled  previous testimony  by Premera                                                              
Blue  Cross  Blue   Shield  in  which  Mr.  Sorrin   related  that                                                              
specialty  services for  muscular skeletal  or cardiovascular  are                                                              
600 to 700 percent of Medicare rates.                                                                                           
                                                                                                                                
MS. LATHAM noted that testimony was on HB 203 and not HB 316.                                                                   
                                                                                                                                
REPRESENTATIVE JOSEPHSON  acknowledged that  point.  He  asked how                                                              
workers'  compensation  patients  could  get  coverage  for  those                                                              
specialties unless  there is sufficient compensation  to match the                                                              
rates.                                                                                                                          
                                                                                                                                
MS.  LATHAM agreed  that it  made  perfect sense.   She  explained                                                              
that the intent  of HB 316 is  to align these rates  to be similar                                                              
to  group health  rates.   She indicated  that the  aforementioned                                                              
Anchorage   rates  for  group   health  will   also  probably   be                                                              
comparable for  workers' compensation  rates.  She  reiterated the                                                              
intent  of  HB  316 is  reduce  the  extremely  inflated  workers'                                                              
compensation medical procedure rates to more reasonable rates.                                                                  
                                                                                                                                
3:50:43 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
3:51:47 PM                                                                                                                    
                                                                                                                                
RICK  TRAINI,   Business  Representative,  Teamsters   Local  959,                                                              
stated he  works as the negotiation  coordinator and  is currently                                                              
serving  his  second term  as  a  member  of the  Alaska  Workers'                                                              
Compensation Board  (WCB) representing labor.  He  offered support                                                              
for  HB 316,  noting  the bill  was introduced  on  behalf of  the                                                              
Alaska  WCB, who  unanimously approved  a  resolution in  December                                                              
requesting  this type  of authority.   He explained  that  the WCB                                                              
created  a special  "listening  tour"  consisting  of a  committee                                                              
with  members  from  labor  and  industry  who  toured  Anchorage,                                                              
Fairbanks,  Juneau, and  Kenai.   Over  the years,  the state  has                                                              
experienced  a  tremendous  escalation  in  medical  costs,  which                                                              
adversely  affects  premiums  paid   by  employers,  and  in  turn                                                              
reduces other benefits  to employees due to the  inflated spending                                                              
on medical bills  for injured workers.   The goal of HB  316 is to                                                              
allow the  board the authority  to set  the fee schedule  based on                                                              
this statute.   He hoped  that the rates  will be more  reflective                                                              
and result in what  the top insurers pay for the  same procedures.                                                              
Currently, Alaska  is at  the top of  the nation in  reimbursement                                                              
for fees and services  and he hopes to bring these  costs in line.                                                              
In response  to  Representative Josephson's  earlier question,  he                                                              
stated  that  each  type  of specialty  or  service  will  have  a                                                              
different conversion  rate.  He  said the bill  is set up  for the                                                              
Medical Services  Review Committee (MSRC) to be  responsive to the                                                              
medical  providers,  insurers,   and  other  participants  in  the                                                              
system  and set  the  rates similar  to  other insured  employees'                                                              
rates.   He offered  his belief that  the WCB will  be a  lot more                                                              
responsive to changing environments and fees.                                                                                   
                                                                                                                                
3:54:53 PM                                                                                                                    
                                                                                                                                
MR. TRANI  reported that the current  medical fees schedule  is in                                                              
its second  or third year.  Prior  to that time, the  schedule was                                                              
in  place  for  10  years  with  two  cost-of-living  adjustments.                                                              
Again,  the   WCB  would  like   the  fee  schedule  to   be  more                                                              
responsive,  and  after  public   testimony  and  input  from  the                                                              
medical  community,  to set  the  conversion  rate at  a  modifier                                                              
acceptable to them,  to the public, employers,  and employees that                                                              
use the workers' compensation system.                                                                                           
                                                                                                                                
CHAIR OLSON remarked the WCB has a tough job.                                                                                   
                                                                                                                                
3:55:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  said  the target  of  the bill  is  the                                                              
RBRVS [Resource  Based Relative  Value Scale].   He asked  whether                                                              
that  scale is  aligned to  reasonable  and fair  amounts akin  to                                                              
group health.                                                                                                                   
                                                                                                                                
MR. TRANI said  that he was not  sure.  The target is  not to have                                                              
that be  the arrival point  but to be  the basis for  the starting                                                              
point before  the conversion rates  or multipliers are  applied to                                                              
the medical  services.   The  end goal  isn't to  have it use  the                                                              
numbers, he  said, but to  tailor it based  on the input  from all                                                              
of the participants, "consumers," and then arrive at a number.                                                                  
                                                                                                                                
3:56:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER asked  whether other  states face  similar                                                              
types of  dramatic cost  disparities; if  other states  face these                                                              
same problems.                                                                                                                  
                                                                                                                                
MR.  TRANI  offered  his  belief  that  other  states  have  faced                                                              
similar  issues; however,  although  Alaska is  now ranked  number                                                              
one in  terms of workers'  compensation costs,  it has  not always                                                              
been ranked so  high.  In 2004,  the state had been  ranked in the                                                              
middle  or low  one third  of costs.   However,  the state  hasn't                                                              
enacted  any  cost  reforms  to  stay  relative  to  what  private                                                              
insurers  pay  for  employee  coverage,   but  other  states  have                                                              
addressed this.   He predicted that approximately 14  to 16 states                                                              
may have some type  of medical fee schedule based  on a derivative                                                              
of  this  method, which  represents  a  trend  to make  sure  that                                                              
patients  using  private  insurance and  patients  using  workers'                                                              
compensation are charged the same fees for doctor's visits.                                                                     
                                                                                                                                
3:58:51 PM                                                                                                                    
                                                                                                                                
CHAIR  OLSON,  after  first  determining  no one  else  wished  to                                                              
testify, closed public testimony on HB 316.                                                                                     
                                                                                                                                
3:59:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON   recalled  the  workers'   compensation                                                              
costs  as being  ranked  first  in the  nation,  but  it does  not                                                              
include  the  permanent,  partial  impairment  (PPI)  ranking,  in                                                              
which the state is ranked 36th of 50.                                                                                           
                                                                                                                                
MICHAEL MONAGLE,  Director, Central  Office, Division  of Workers'                                                              
Compensation,   Department  of   Labor  &  Workforce   Development                                                              
(DLWD), answered  that the state  is number one, but  being number                                                              
one in  premium stems from  a combination of  things.  He  said it                                                              
is  made up  of indemnity  costs, noting  that permanent,  partial                                                              
impairment  is part  of  the indemnity  costs,  but medical  costs                                                              
constitutes  the other  part.  The  medical portion  in Alaska  is                                                              
$0.75 on the dollar  whereas nationally it is $0.55.   The medical                                                              
costs  on a  time  loss  claim, an  indemnity  claim,  in which  a                                                              
worker  misses time  away  from  work, averages  $57,000,  whereas                                                              
nationally   it  averages   $24,000.     Thus,  Alaska's   medical                                                              
component of the  premium loss cost has been  significantly higher                                                              
than  the  rest  of  the country.    He  acknowledged  that  other                                                              
portions,  such as  indemnity benefits,  are about  in the  middle                                                              
with the  PPI being a  portion of indemnity.   He agreed  that the                                                              
state's PPI benefits nationally rank in about the lower third.                                                                  
                                                                                                                                
4:00:52 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  said he doesn't see the  goal of linking                                                              
rates  to group  health  has been  shown.   He  asked whether  the                                                              
aforementioned  is  a  goal  or  is it  just  something  that  the                                                              
Medical Services  Review Committee (MSRC) in combination  with the                                                              
WCB is expected to do.                                                                                                          
                                                                                                                                
MR.  MONAGLE   suggested  that   the  general  practitioners   use                                                              
evaluation  and management  and include the  general office  visit                                                              
in line with  general health.  He acknowledged  that as previously                                                              
suggested,  specialty medicine and  specialty practitioner  rates,                                                              
including  some cardiologists  and  orthopedic physicians,  charge                                                              
significantly  higher  rates  in Alaska.    He  said that  as  Mr.                                                              
Traini  mentioned,   when  developing   conversion  factors,   the                                                              
division will examine  costs for each specialty.   He related that                                                              
a  conversion  factor   will  be  developed  for   evaluation  and                                                              
management whereas  a separate conversion factor  may be developed                                                              
for surgery  and specialty surgery.   He envisioned that  the MSRC                                                              
in conjunction  with the  WCB will adopt  conversion factors.   He                                                              
did  not think  it was  in anyone's  intent  to create  conversion                                                              
factors  that will  dissuade providers  from  treating an  injured                                                              
worker  in the  state.   He offered  his belief  that through  the                                                              
collaboration process  the division should be able to  arrive at a                                                              
conversion factor agreeable to everyone.                                                                                        
                                                                                                                                
4:02:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  REINBOLD noted that  labor costs, oil  production,                                                              
and education  costs in  Alaska are high.   She acknowledged  that                                                              
she is sad  that workers' compensation  costs are also  high.  She                                                              
expressed an interest  in reducing costs, and she  asked if safety                                                              
prevention  in  the workplace  has  been  implemented.   She  also                                                              
noted that  the WCB  had three pages  of suggestions  [in members'                                                              
packets.]   She  further asked  whether  he was  pleased with  how                                                              
much was incorporated in the bill or if he has issues.                                                                          
                                                                                                                                
MR. MONAGLE  replied that medical  costs are the "elephant  in the                                                              
room," and  they really  are the  cost driver.   If the  state can                                                              
resolve the medical  cost issues, it will also  help lower premium                                                              
costs.  Certainly,  other workers' compensation  issues definitely                                                              
need to be resolved.   He felt that the list  in [WCB's Resolution                                                              
Number  13-01] addresses  some things  related  to medical  costs,                                                              
such  as a  recommendation  for  treatment guidelines  to  address                                                              
utilization,  but other  things  such as  employment benefits  and                                                              
legal  costs could  also be addressed  to help  lower over  rates;                                                              
however, medical costs represent the biggest issue.                                                                             
                                                                                                                                
4:04:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  REINBOLD   reiterated  that   implementing  worker                                                              
safety can also help prevent worker injuries.                                                                                   
                                                                                                                                
MR.  MONAGLE offered  his  belief that  employers  currently do  a                                                              
great job  focusing on safety  issues.   From 1990 to  the current                                                              
date, employment  in Alaska has  increased over 100,000  jobs, but                                                              
during  that same  time period,  the loss  rates -  the number  of                                                              
workplace injuries  - has  been reduced from  30,000 to  less than                                                              
20,000.    Thus,  the  state  has   been  growing  employment  and                                                              
reducing  injuries,  which is  largely  due to  employers  valuing                                                              
safety programs  and being  safety conscious.   The Department  of                                                              
Labor &  Workforce Development,  Division  of Labor Standards  and                                                              
Safety, has  a safety  consultant program  in which employers  can                                                              
confidentially  consult  with  the  division  to  create  a  safer                                                              
environment yet  not be penalized  for violations.  In  fact, this                                                              
program helps  identify safety practices.   In addition,  a number                                                              
of  insurance companies  offer  premium reductions  for  voluntary                                                              
workplace  safety  programs, such  as  drug  free workplace.    He                                                              
reiterated  that insurance  companies  offer  incentives for  safe                                                              
work environments and to reduce premiums and premium discounts.                                                                 
                                                                                                                                
4:06:13 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  remarked that a number  of unions have  actively been                                                              
involved  in developing  their own  safety  standards, which  have                                                              
been  picked  up  and  used  by   insurance  companies  and  self-                                                              
insurers, too.   He said that the [state's] track  record is good,                                                              
but the  aging workforce contributes  to the issue  since injuries                                                              
require additional healing time and expense for older workers.                                                                  
                                                                                                                                
4:06:53 PM                                                                                                                    
                                                                                                                                
MR.  MONAGLE,  in response  to  Representative  Saddler's  earlier                                                              
question, acknowledged  that this issue  is one other  states also                                                              
face.    Prior  to  1990,  the   majority  of  costs  in  workers'                                                              
compensation  systems nationwide  were indemnity  costs so  states                                                              
have focused  on that  aspect of  loss costs.   At the  same time,                                                              
medical  costs   surpassed  indemnity  costs  nationwide   as  the                                                              
biggest  cost driver.    In 1990,  12  states  had fee  schedules.                                                              
Today, only six  states do not have fee schedules  so a transition                                                              
has occurred nationwide  to adopt fee schedules,  although not all                                                              
are RBRVS schedules.   However, over 32 states  have adopted RBRVS                                                              
methodology  in producing schedules.   Again,  it is a  nationwide                                                              
issue, but  a number  of states  have worked  to address  this via                                                              
practices and  adopting fee schedules  represents "a big  tool" to                                                              
help control medical costs in workers' compensation.                                                                            
                                                                                                                                
CHAIR  OLSON  remarked  that  not surprisingly  all  32  of  those                                                              
states have lower rates than Alaska.                                                                                            
                                                                                                                                
MR. MONAGLE agreed.                                                                                                             
                                                                                                                                
4:08:12 PM                                                                                                                    
                                                                                                                                
CHAIR  OLSON,  after  first  determining  no one  else  wished  to                                                              
testify, closed public testimony on HB 316.                                                                                     
                                                                                                                                
[HB 316 was held over.]                                                                                                         
                                                                                                                                
4:08:39 PM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 4:08 p.m. to 4:10 p.m.                                                                       
                                                                                                                                
         HB 60-UNIFORM REAL PROPERTY TRANSFERS ON DEATH                                                                     
                                                                                                                                
4:10:38 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  announced that the  final order of business  would be                                                              
HOUSE BILL  NO. 60, "An Act  adopting and relating to  the Uniform                                                              
Real Property Transfer on Death Act."                                                                                           
                                                                                                                                
REPRESENTATIVE  REINBOLD  made   a  motion  to  adopt  a  proposed                                                              
committee substitute  for HB 60,  Version C, labeled  28-LS0265\C,                                                              
Bannister, 3/14/14 as the working document.                                                                                     
                                                                                                                                
CHAIR OLSON objected for the purpose of discussion.                                                                             
                                                                                                                                
4:11:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MAX GRUENBERG,  Alaska  State Legislature,  stated                                                              
this  bill is  a combination  of  two bills,  HB  60, the  Uniform                                                              
Transfer on  Death Act, and HB  61, which repeals  the prohibition                                                              
of  joint  tenancy   with  the  right  of  survivorship   in  real                                                              
property.    These bills  both  relate  to  the transfer  of  real                                                              
property for efficiency and to reduce costs.                                                                                    
                                                                                                                                
4:12:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   GRUENBERG  explained   that   the  Uniform   Real                                                              
Property  Transfer  on Death  Act  allows a  person  to execute  a                                                              
transfer on  death (TOD)  deed that  becomes effective  upon one's                                                              
death.  The  process would be to  sign the transfer and  record it                                                              
and it  becomes effective when  the person  dies.  The  person can                                                              
revoke  it  or issue  another  superseding  deed, and  the  person                                                              
designated to  receive the property  can disclaim the  transfer of                                                              
property.   He stated the only  requirement is to ensure  that the                                                              
document  is recorded.   In  other words,  a "wild"  deed or  will                                                              
that is  not recorded will  not affect  the property.   This bill,                                                              
HB  60,  will  make  it  very  easy  to  determine  who  owns  the                                                              
property.   Federal and  state law allow  that TOD bank  accounts,                                                              
securities,  and  personal  property  can  be  owned  jointly  and                                                              
transferred on  death, with the  advantage that it  avoids probate                                                              
and is taxed as a transfer on death.                                                                                            
                                                                                                                                
REPRESENTATIVE  GRUENBERG  said this  matter  was  brought to  his                                                              
attention when a  retired attorney, Stan Titus,  who owns property                                                              
in various other  states, indicated that he would  like to prepare                                                              
his  estate.   He  pointed  out that  21  other states  have  this                                                              
provision,  with the latest  state to  adopt this provision  being                                                              
South Dakota.   Currently, three  other states besides  Alaska are                                                              
considering  this  change.   He  characterized  it as  being  "the                                                              
coming thing," and  he is not aware of any opposition  to the bill                                                              
except by  a couple  of individual probate  lawyers.   He admitted                                                              
that in  complex estates it  probably is  a good idea  for lawyers                                                              
to be involved;  however, the TOD deed process is  a simple method                                                              
for parties  who have limited  assets, such  as owning a  house in                                                              
Big Lake and having  a pension, since the TOD deed  process avoids                                                              
probate and legal fees.                                                                                                         
                                                                                                                                
4:15:05 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG  referred  to Section  5,  the  repealer                                                              
section  of HB 60.   This  bill even  provides forms  that can  be                                                              
used, although  it isn't required  that these  forms be used.   He                                                              
pointed out that  this act is uniform except for  one provision in                                                              
which  an  inter  vivos  deed  that  doesn't  expressly  revoke  a                                                              
transfer  on death  deed (or  a part of  the TOD  deed) creates  a                                                              
rebuttable presumption  that the inter vivos deed  is effective to                                                              
revoke a  recorded TOD deed,  or a part  of the recorded  TOD deed                                                              
if the  deed meets  certain requirements.   He said  this requires                                                              
that   the  deed   completely  divest   the   transferor  of   the                                                              
transferor's  interest in the  real property  that is  the subject                                                              
of the transfer  on death deed.   This provision was  suggested by                                                              
a  witness who  testified  before the  District  of Columbia  city                                                              
council.    It  seemed  to be  a  good  idea,  and  Representative                                                              
Gruenberg discussed  it with the [uniform law]  commissioners, and                                                              
they do not have any objection, he said.                                                                                        
                                                                                                                                
4:16:49 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  highlighted one other provision  that is                                                              
not part of  the uniform act and  that is the repealer  in Section                                                              
5.    Currently,  the  state has  an  old  statute  from  Alaska's                                                              
territorial  days that  says a  person cannot  hold real  property                                                              
jointly with  a right of  survivorship; instead,  it has to  be by                                                              
tenancy in  common.   The difference between  a tenancy  in common                                                              
and joint  tenancy with a  right of survivorship  is that  in both                                                              
cases a  present ownership  in property exists.   He  explained it                                                              
is  not  like  a  TOD deed,  in  which  the  person  receives  the                                                              
ownership upon  death, but a  present ownership exists.   However,                                                              
with a  tenancy in  common if  you die,  your estate obtains  your                                                              
interest.    In instances  with  joint  tenancy  with a  right  of                                                              
survivorship,   the  other   co-owners  obtain   it.    In   those                                                              
instances,  it  really  isn't  necessary  to  prepare  a  will  to                                                              
transfer the  property, so it is  a simpler method.   He explained                                                              
that  previously an  old  legal term,  the  four unities  existed,                                                              
which is  rarely used.   That's the reason  why they  didn't allow                                                              
joint  tenancy with  the right of  survivorship.   The courts  now                                                              
look to peoples'  intent so most states have gotten  away from the                                                              
old  statutes that  don't allow  joint tenancy  in real  property.                                                              
He said that  this just goes with  the normal law in  most places.                                                              
He  said that  Alaska is  a not  a  "code state"  but follows  the                                                              
common law, and this  will just put it back in  the common law, he                                                              
explained.                                                                                                                      
                                                                                                                                
4:18:59 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER  referred  to  page 2,  lines  27-30,  and                                                              
asked for further clarification on the process.                                                                                 
                                                                                                                                
REPRESENTATIVE  GRUENBERG  explained that  many  uniform acts  are                                                              
drafted  by a  committee of  commissioners on  uniform state  law,                                                              
with  one  professor -  in  this  instance  a professor  from  the                                                              
University  of Iowa  law  school.   This  particular  hypothetical                                                              
situation  was apparently  overlooked  when  the  uniform act  was                                                              
drafted.   This provision means that  if a second deed  exists and                                                              
the  person  doesn't  revoke the  original  deed,  which  normally                                                              
would  contain  a  revocation  clause,  a  rebuttable  presumption                                                              
exists, such  that it  is presumed  that the  earlier TOD  deed is                                                              
revoked.   In instances in which  the new deed  completely divests                                                              
the  grantor  of  his  interest  in the  real  property  and  also                                                              
satisfies AS  13.48.070 (1)(A)(2)  means that it  is "acknowledged                                                              
by  the transferor  after  the acknowledgment  of  the deed  being                                                              
revoked  and  recorded  before   the  transferor's  death  in  the                                                              
recording district  where the  deed is  recorded."  He  emphasized                                                              
that it  must be signed  in front  of a notary  and recorded.   He                                                              
said that  there can be  a rebuttal, but  normally if one  deed is                                                              
recorded  and  another deed  is  recorded  and both  indicate  TOD                                                              
deed, it'd  be clear  that the  person's intent  is to  follow the                                                              
later  deed;  however,  a  circumstance  might  exist  where  that                                                              
doesn't  occur.    In  the  District  of  Columbia  ruling  it  is                                                              
absolute; however,  he cautioned that  he did not want  to make it                                                              
absolute  since he  has found there  will always  be some  factual                                                              
situation that  wasn't anticipated.   This language would  make it                                                              
rebuttable to cover any unusual circumstance.                                                                                   
                                                                                                                                
REPRESENTATIVE SADDLER acknowledged it should never be absolute.                                                                
                                                                                                                                
4:22:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  agreed.  He  pointed out that  Alaska is                                                              
the first  state to adopt  this provision.   He indicated  that it                                                              
does not disturb  uniformity and it is possible  the [uniform law]                                                              
commissioners may decide  to pick up the provision  later.  In the                                                              
meantime, this will provide legislative history, he said.                                                                       
                                                                                                                                
4:23:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG, in  response to  a question, said  that                                                              
the  next committee  of  referral,  the House  Judiciary  Standing                                                              
Committee, will examine things related [to the judiciary].                                                                      
                                                                                                                                
BENJAMIN ORZESKE,  Legal Counsel, Uniform Law Commission  for Real                                                              
Property,  Trust,   and  Estate   Acts,  National  Conference   of                                                              
Commissioners  on Uniform State  Laws (NCCUSL), acknowledged  that                                                              
Representative  Gruenberg did  a  good job  describing this  bill.                                                              
He offered to answer any questions.                                                                                             
                                                                                                                                
REPRESENTATIVE  GRUENBERG  referred to  his  written testimony  in                                                              
members' packets.                                                                                                               
                                                                                                                                
4:24:48 PM                                                                                                                    
                                                                                                                                
DEBORAH  RANDALL,  Attorney,  stated  she is  an  estate  planning                                                              
attorney.    She  said  she  was  absolutely  delighted  when  the                                                              
uniform  bill was  presented to  the estate  and probate  section.                                                              
She  said she  is  a  total believer  in  this.   This  bill  will                                                              
simplify  matters  for  clients  who  only own  a  piece  of  real                                                              
property.   She explained that her  typical client will  have real                                                              
estate,  such as  a house  and bank  accounts that  can be  passed                                                              
through  a  joint  account  or  with  a  beneficiary  designation.                                                              
Thus, the only  property that can't be transferred  in that manner                                                              
is real property,  and this bill will simplify  this for countless                                                              
people.  She supports  the proposition to keep it  simple and said                                                              
this  bill  will  make  it  simple  for  people  and  she  is  not                                                              
concerned  that  this bill  will  adversely affect  her  workload.                                                              
She thinks that  people will likely still use  lawyers for advice,                                                              
but this  will provide "one  more quiver  in our arsenal"  that we                                                              
can use.  She  said she favored revoking the  prohibition on joint                                                              
tenancy by  survivorship of real  property and offered  her belief                                                              
that every  state does this,  including Arizona and  Hawaii, which                                                              
works great  for parents who wish  to leave property  to surviving                                                              
children.   She  reiterated  that  this will  definitely  simplify                                                              
estate  planning for  many people.   She characterized  this  as a                                                              
"win-win" situation for everyone.                                                                                               
                                                                                                                                
4:27:05 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG   stated  that  Ms.  Randall   was  very                                                              
involved  on the probate  and real  estate sections.   He  pointed                                                              
out that  [lines 22-27, page 5,  of Version C,]  carefully advises                                                              
that  this action  may have  important legal  consequences and  if                                                              
the  party  has  any questions,  that  he/she  should  consult  an                                                              
attorney.  He asked whether this was of considerable discussion.                                                                
                                                                                                                                
MS.  RANDALL said  that  the main  consideration  was that  people                                                              
would  be doing  transfers without  understanding  what they  were                                                              
doing.    She  expressed  that this  specific  language  will  put                                                              
people  on  notice  that  more  issues  could  exist  besides  the                                                              
transfer of property,  like creditor claims or  issues surrounding                                                              
children with  disabilities.   She said  that she thought  perhaps                                                              
this warning would make them stop and think before they act.                                                                    
                                                                                                                                
4:28:50 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HERRON asked  to place  on the  record the  reason                                                              
for the prohibition during territorial days and carried forward.                                                                
                                                                                                                                
REPRESENTATIVE  GRUENBERG said he  not been  able to do  extensive                                                              
research, but  he recalled  one case, Carver  v. Gilbert  387 P.2d                                                              
928 (1963).  The  case discussed the genesis of this  statute.  He                                                              
recalled that  this was taken  from Oregon  laws, and at  the time                                                              
of  the Organic  Act  in the  late 19th  Century,  many laws  were                                                              
taken  from   Oregon,  and  the   four  unities   were  important,                                                              
including  unity of  time, title,  possession, and  interest.   He                                                              
characterized the time  period as being more formal  than now, and                                                              
the court did not  consider intention of the parties,  such as how                                                              
to get out from  under joint tenancy and revoke it.   He noted the                                                              
difficultly researching Oregon laws that date back to the 1890s.                                                                
                                                                                                                                
4:31:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER  asked how much property is  transferred on                                                              
transfer on  death provisions  in other states.   He  expressed an                                                              
interest  in  the market  share  that  would  be taken  away  from                                                              
probate courts by TOD provisions.                                                                                               
                                                                                                                                
REPRESENTATIVE GRUENBERG deferred to Mr. Orzeske.                                                                               
                                                                                                                                
MR. ORZESKE  said he doesn't have  hard statistics, but  the first                                                              
state  that allowed  these was Missouri  in 1989,  and the  second                                                              
state followed  about eight years  later.  Even in  Missouri, TODs                                                              
represents a  small percentage of  transfers.  He estimated  it is                                                              
5 to 15 percent of transfers.                                                                                                   
                                                                                                                                
4:32:39 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER asked if this action is outside the will.                                                                
                                                                                                                                
REPRESENTATIVE  GRUENBERG  answered  that  [under  the  bill]  the                                                              
transfer would not  be done with a will, which  would generally go                                                              
through  probate.   He added that  this [transfer  on death  deed]                                                              
can be  done 20  years prior  to a will  or a  few weeks  prior to                                                              
death, but it is definitely not part of the will.                                                                               
                                                                                                                                
4:33:20 PM                                                                                                                    
                                                                                                                                
KEN  HELANDER,  Associate State  Director,  Legislative  Advocacy,                                                              
AARP,  offered support  for  HB  60 including  the  repeal of  the                                                              
prohibition  of joint  tenancy  with right  of  survivorship.   He                                                              
stated that  probate laws  which govern  the transfer  of property                                                              
at death vary  significantly from state to state.   The variations                                                              
and   complexity   of   these   laws   have   contributed   to   a                                                              
misunderstanding of  this process.  In  fact, this has  led to the                                                              
development of uniform  model legislation to simplify  the process                                                              
for  the  average  consumer.     Non-probate  transfers,  such  as                                                              
payment  on  death  accounts,  accounts   passing  by  beneficiary                                                              
designation, and  joint accounts passing by right  of survivorship                                                              
do not  involve the  court system  and thus give  people a  way to                                                              
transfer  control  of  personal   assets  without  the  costs  and                                                              
unwanted side  effects of probate  litigation.  He said  this bill                                                              
would authorize  TOD deeds  to enable  revocable non-probate  real                                                              
property  transfers.   Many  older people  have  fixed or  limited                                                              
incomes  and  very often  their  principal  asset is  their  home.                                                              
Placing  survivors through  complex, costly,  and lengthy  probate                                                              
procedures  to settle  simple  matters  is an  unnecessary  burden                                                              
during  a time  of bereavement  and  stress.   Transfers on  death                                                              
deeds  also  protect  the  property  interests  of  the  owner  by                                                              
avoiding many  of the  pitfalls that occur  with deeds  in common,                                                              
which  can even  lead to  financial exploitation  of a  vulnerable                                                              
elder.    The  AARP  believes  that HB  60  will  serve  the  best                                                              
interests of Alaskans, and he encouraged passage of the bill.                                                                   
                                                                                                                                
4:35:39 PM                                                                                                                    
                                                                                                                                
MARIE DARLIN, Chair,  Legislative Advocacy, AARP,  said she agreed                                                              
with Mr. Helander.   She said the work on HB 60  started last year                                                              
and  the bill  has  had some  good  work since  then.   She  urged                                                              
members to  please finalize the  bill.  She acknowledged  that the                                                              
AARP membership  is often involved  in these types of  issues more                                                              
than others.  She offered AARP's support for the bill.                                                                          
                                                                                                                                
4:37:29 PM                                                                                                                    
                                                                                                                                
ERROL  CHAMPION,  Chair,  Alaska Association  of  Realtors,  Inc.,                                                              
stated he provided  written testimony a year ago in  support of HB                                                              
60, and  the Alaska Association  of Realtors continues  to support                                                              
the bill.   He said  this is the  right direction, since  the most                                                              
important  asset many  families often  have is  their home.   This                                                              
bill will allow  the right of passage without  surviving relatives                                                              
having to  go through  legal costs  and the length  of time  to go                                                              
through probate.  He urged adoption of HB 60.                                                                                   
                                                                                                                                
4:38:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER  appreciated   him  putting  this  on  the                                                              
record.    He said  he  had  received  a letter  of  support  from                                                              
realtors in Eagle River so he was pleased to have his testimony.                                                                
                                                                                                                                
MR.  CHAMPION   said  it   was  amazing   how  many  real   estate                                                              
transactions  are related  to the  passage of  ownership due  to a                                                              
death.                                                                                                                          
                                                                                                                                
[HB 60 was held over.]                                                                                                          
                                                                                                                                
4:39:03 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being  no further business  before the committee,  the House                                                              
Labor and  Commerce Standing  Committee meeting  was adjourned  at                                                              
4:39 p.m.                                                                                                                       

Document Name Date/Time Subjects
HB316 Amendment O.4.PDF HL&C 3/24/2014 3:15:00 PM
HB 316
HB316 Draft Conceptual Amendment 1.pdf HL&C 3/24/2014 3:15:00 PM
HB 316
HB60 Sectional Analysis-Draft Proposed Blank CS ver C.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Legal Services Memo regarding Changes from Ver A to Ver C.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Draft Proposed Blank CS ver C.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-Testimony of Ben Orzeske.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-AS 34.15.130.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-Legal Memo re Changes in CS ver C 3-18-14.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-Letter American Bar Association 1-14-10.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-Letter American College of Real Estate Lawyers 3-31-10.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-Memo re Transfer On Death States List 1-31-14.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-ULC Summary of URPTODA 1-25-13.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB60 Supporting Documents-URPTODA Draft with comments from Uniform Law Commission 9-30-09.pdf HL&C 3/21/2014 3:15:00 PM
HL&C 3/24/2014 3:15:00 PM
HB 60
HB230 Draft CS ver N.pdf HL&C 3/24/2014 3:15:00 PM
HB 230
HB230 Draft Proposed Amendment N.1.pdf HL&C 3/24/2014 3:15:00 PM
HB 230