Legislature(2015 - 2016)BARNES 124

03/16/2016 03:15 PM LABOR & COMMERCE

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as
Download Video part 1. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 188 PERSON W/DISABILITY SAVINGS ACCOUNTS TELECONFERENCED
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
+= HB 337 MARIJUANA TAXES;EXCESS POSSESSION;BONDS TELECONFERENCED
Heard & Held
+= HB 313 PUBLIC CONSTRUCTION CONTRACTS WAGE RATES TELECONFERENCED
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
+= HB 263 EMPLOYER REPORT OF WORKPLACE INJURY/DEATH TELECONFERENCED
Scheduled but Not Heard
-- Public Testimony <Time Limit May Be Set> --
+ Bills Previously Heard/Scheduled TELECONFERENCED
**Streamed live on AKL.tv**
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                         March 16, 2016                                                                                         
                           3:21 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Kurt Olson, Chair                                                                                                
Representative Shelley Hughes, Vice Chair                                                                                       
Representative Jim Colver                                                                                                       
Representative Gabrielle LeDoux                                                                                                 
Representative Cathy Tilton                                                                                                     
Representative Andy Josephson                                                                                                   
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Sam Kito                                                                                                         
Representative Mike Chenault (alternate)                                                                                        
                                                                                                                                
OTHER LEGISLATORS PRESENT                                                                                                     
                                                                                                                                
Representative Tammy Wilson                                                                                                     
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 188                                                                                                              
"An  Act   relating  to  financial  accounts   for  persons  with                                                               
disabilities;  relating to  financial  institutions; relating  to                                                               
property exemptions;  relating to  securities; and  providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 337                                                                                                              
"An Act relating to taxes on marijuana."                                                                                        
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 313                                                                                                              
"An Act relating to the public construction contracts, including                                                                
the application of prevailing wage rates."                                                                                      
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 263                                                                                                              
"An Act relating to reporting of workplace injuries to the                                                                      
division of labor standards and safety."                                                                                        
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                  
                                                                                                                                
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 188                                                                                                                  
SHORT TITLE: PERSON W/DISABILITY SAVINGS ACCOUNTS                                                                               
SPONSOR(s): REPRESENTATIVE(s) SADDLER                                                                                           
                                                                                                                                
04/11/15       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/11/15       (H)       L&C, FIN                                                                                               
03/09/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/09/16       (H)       Heard & Held                                                                                           
03/09/16       (H)       MINUTE(L&C)                                                                                            
03/16/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 337                                                                                                                  
SHORT TITLE: MARIJUANA TAXES;EXCESS POSSESSION;BONDS                                                                            
SPONSOR(s): REPRESENTATIVE(s) LEDOUX                                                                                            
                                                                                                                                
02/24/16       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/24/16       (H)       L&C, FIN                                                                                               
03/09/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/09/16       (H)       Heard & Held                                                                                           
03/09/16       (H)       MINUTE(L&C)                                                                                            
03/11/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/11/16       (H)       -- MEETING CANCELED --                                                                                 
03/16/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 313                                                                                                                  
SHORT TITLE: PUBLIC CONSTRUCTION CONTRACTS WAGE RATES                                                                           
SPONSOR(s): LABOR & COMMERCE                                                                                                    
                                                                                                                                
02/17/16       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/17/16       (H)       L&C                                                                                                    
03/14/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/14/16       (H)       Scheduled but Not Heard                                                                                
03/16/16       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
KIM SKIPPER, Staff                                                                                                              
Representative Dan Saddler                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:    On   behalf  of  Representative  Saddler,                                                           
sponsor,   presented  the   sectional   analysis  and   committee                                                             
substitute (CS) for HB 188, Version E.                                                                                          
                                                                                                                                
STUART SPIELMAN, Senior Policy Advisor and Counsel                                                                              
Autism Speaks                                                                                                                   
Washington, District of Columbia                                                                                                
POSITION STATEMENT:  Answered questions  during the hearing of HB                                                             
188.                                                                                                                            
                                                                                                                                
KALYSSA MAILE, Staff                                                                                                            
Representative Gabrielle LeDoux                                                                                                 
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   On behalf  of Representative  LeDoux, Chair                                                             
of  the House  Judiciary Standing  Committee, sponsor,  presented                                                               
the committee substitute (CS) for HB 337, Version H.                                                                            
                                                                                                                                
KONRAD JACKSON, Staff                                                                                                           
Representative Kurt Olson                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  On behalf  of Representative Olson, Chair of                                                             
the  House  Labor  and   Commerce  Standing  Committee,  sponsor,                                                               
introduced HB 313.                                                                                                              
                                                                                                                                
CHRIS DIMOND                                                                                                                    
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
MAX MIELKE, Business Manager                                                                                                    
Plumbers and Pipefitters Local 262                                                                                              
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
MIKE STURROCK, Spokesperson                                                                                                     
Island Contractors                                                                                                              
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
PAUL GROSSI, Spokesperson                                                                                                       
Alaska State Pipe Trades; Spokesperson                                                                                          
Ironworkers                                                                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
RODNEY HESSON, Spokesperson                                                                                                     
International Brotherhood of Electrical Workers Local 1547;                                                                     
President                                                                                                                       
Juneau Building Trades Council                                                                                                  
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
KIRK PERISICH, Southeast Representative                                                                                         
Carpenters Local 1281; Spokesperson                                                                                             
Piledrivers and Millwrights                                                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
DAVE REAVES                                                                                                                     
Wasilla, Alaska                                                                                                                 
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
WAYLON KNUDSEN                                                                                                                  
Palmer, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
KEVIN POMEROY, Spokesperson                                                                                                     
Laborers Local 942                                                                                                              
Road Service Area Commissioner                                                                                                  
Fairbanks North Star Borough                                                                                                    
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
LARRY TALBERT, Business Manager                                                                                                 
Local 367, Plumbers and Steamfitters                                                                                            
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
ROCKY KNUDSEN                                                                                                                   
Kenai, Alaska                                                                                                                   
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
BRANDON CALCATERRO                                                                                                              
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in opposition the HB 313.                                                                      
                                                                                                                                
SUZANNE MCCARTHY, Spokesperson                                                                                                  
Alaska Laborers Training School                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
JULIUS MATHEW                                                                                                                   
Eagle River, Alaska                                                                                                             
POSITION STATEMENT:  Testified in opposition to HB 313.                                                                       
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:21:14 PM                                                                                                                    
                                                                                                                                
CHAIR KURT  OLSON called  the House  Labor and  Commerce Standing                                                             
Committee meeting to  order at 3:21 p.m.   Representatives Olson,                                                               
LeDoux,  Tilton, Hughes,  Colver, and  Josephson were  present at                                                               
the call to order.  Representative Wilson also was present.                                                                     
                                                                                                                                
          HB 188-PERSON W/DISABILITY SAVINGS ACCOUNTS                                                                       
                                                                                                                                
3:21:32 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON announced  that the first order of  business would be                                                               
HOUSE BILL  NO. 188, "An  Act relating to financial  accounts for                                                               
persons  with disabilities;  relating to  financial institutions;                                                               
relating  to property  exemptions;  relating  to securities;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
3:22:14 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HUGHES  moved  to adopt  the  proposed  committee                                                               
substitute  (CS)  for  HB 188,  labeled  29-LS0787\E,  Bannister,                                                               
3/9/16,  as the  working document.     There being  no objection,                                                               
Version E was before the committee.                                                                                             
                                                                                                                                
3:22:37 PM                                                                                                                    
                                                                                                                                
KIM  SKIPPER,  Staff  to  Representative  Saddler,  Alaska  State                                                               
Legislature, informed  the committee  the main  change to  HB 188                                                               
from the  original version to  Version E was that  the Department                                                               
of Revenue  would run  the program instead  of the  Department of                                                               
Commerce,  Community &  Economic  Development.   Further  changes                                                               
are:   broader  language has  been  added related  to changes  in                                                               
federal  authorizing  law;  allows  DOR to  contract  with  other                                                               
states  to  join a  consortium  and  share administrative  tasks;                                                               
allows DOR  to have  an equal  vote in  the request  for proposal                                                               
(RFP)  process; allows  DOR to  contract with  its own  financial                                                               
institution under  certain conditions.  She  paraphrased from the                                                               
following sectional analysis [original punctuation provided]:                                                                   
                                                                                                                                
                                                                                                                                
       Sec. 1: Cites this as the Alaska ABLE Act Savings                                                                        
     Program Act                                                                                                                
                                                                                                                                
     Sec.  2:  Creates  a new  chapter  65.  Alaska  Savings                                                                    
     Program for Eligible Individuals                                                                                           
                                                                                                                                
          Sec. 06.65.010: Program authorized. Authorizes                                                                        
     Alaska ABLE  savings program in the  Department - which                                                                    
     is  the  Alaska Department  of  Revenue.  Allows it  to                                                                    
     implement and administer the  program under the Federal                                                                    
     ABLE Act.                                                                                                                  
                                                                                                                                
          Sec.   06.65.020:   General   department   duties.                                                                    
     Outlines the  duties of the department  in implementing                                                                    
     and administering the program.                                                                                             
                                                                                                                                
          Sec. 06.65.030: Modification of program. Gives                                                                        
     the  Department  authority  to modify  the  program  in                                                                    
     accordance to any federal law changes                                                                                      
                                                                                                                                
          Sec. 06.65.040: Additional department powers.                                                                         
     Allows department to set  fees for program transactions                                                                    
     and  services  and  also   develop  marketing  plan  to                                                                    
     promote the ABLE program                                                                                                   
                                                                                                                                
          Sec.     06.65.050:     Contracting     authority;                                                                    
     procurement  exemption. Allows  department to  contract                                                                    
     with a  person to  assist in implementing  the program,                                                                    
     provide  services,  join  other  states  to  obtain  or                                                                    
     provide   services    for   implementation,    join   a                                                                    
     cooperative  effort   with  other  states   to  provide                                                                    
     services for the program  that could include investment                                                                    
     and record-keeping services. Allows  state to join with                                                                    
     other   states  to   allow   an   Alaska  resident   to                                                                    
     participate  in  a  program   in  another  state  under                                                                    
     federal  authorizing law  and for  an outside  state to                                                                    
     participate in a program in  this state. If contracting                                                                    
     with another  state, AS  36.30 (Procurement  Code) will                                                                    
     not apply.                                                                                                                 
                                                                                                                                
     Sec.  06.65.060:   Investment  oversight:   Allows  the                                                                    
     department   to  oversee   and  approve   selection  of                                                                    
     investment managers  and advisors for the  program, and                                                                    
     to  oversee all  investment disclosures  and regulatory                                                                    
     filings related to program investments                                                                                     
                                                                                                                                
     Sec.   06.65.070:  Financial   contractor  obligations:                                                                    
     outlines duties/obligations  of the  selected financial                                                                    
     contractor(s)                                                                                                              
                                                                                                                                
     Sec.   06.65.080:   Additional   audits:   Allows   the                                                                    
     department  to  order  an  audit  of  the  contractor's                                                                    
     financial operation and position  in addition to annual                                                                    
     audit if the department has reason to be concerned                                                                         
                                                                                                                                
     Sec.  06.65.090:   Contract  termination;  non-renewal.                                                                    
     Gives  department authority  to not  renew a  financial                                                                    
     contract. If  so it would  take custody of  the program                                                                    
     accounts  and   transfer  them  to   another  financial                                                                    
     contractor that offers similar program accounts                                                                            
                                                                                                                                
     Sec. 06.65.100: Eligible  individuals. Describes who is                                                                    
     eligible to participate in the program.                                                                                    
                                                                                                                                
     Sec.    06.65.110:     Representative    of    eligible                                                                    
     individuals. Describes who may  act as a representative                                                                    
     of  the eligible  individual who  is a  minor or  lacks                                                                    
     decision-making capacity                                                                                                   
                                                                                                                                
     Sec. 06.65.120: Program  account ownership. States that                                                                    
     the  owner of  the  program account  is the  designated                                                                    
     beneficiary.                                                                                                               
                                                                                                                                
     Sec.  06.65.130:  Number  of program  accounts.  Allows                                                                    
     only  one program  account  per designated  beneficiary                                                                    
     under federal authorizing law.                                                                                             
                                                                                                                                
     Sec. 06.65.140:  Program account  application: Outlines                                                                    
     department procedures for  program account applications                                                                    
     and information to be collected in that process                                                                            
                                                                                                                                
     Sec.  06.65.150:  Program  account  establishment  fee.                                                                    
     Allows financial  contractor to charge  a nonrefundable                                                                    
     to   establish  program   account.  That   fee  to   be                                                                    
     determined   in  the   contract   with  the   financial                                                                    
     contractor.                                                                                                                
                                                                                                                                
     Sec.   06.65.160:    Program   account   contributions.                                                                    
     Outlines  how a  person  can make  a contribution,  the                                                                    
     limit authorized  by federal law, allows  department to                                                                    
     reject  or withdraw  a contribution  that exceeds  that                                                                    
     annual   limit   or   maximum  limit   established   by                                                                    
     authorizing  law or  if designated  beneficiary is  not                                                                    
     eligible,  and that  financial  contractor must  report                                                                    
     contributions to the IRS.                                                                                                  
                                                                                                                                
     Sec.  06.65.170: Limited  investment direction.  Limits                                                                    
     to  two   the  number   of  times  a   program  account                                                                    
     investment can be changed.                                                                                                 
                                                                                                                                
     Sec.  06.65.180:  Change   of  designated  beneficiary.                                                                    
     Allows  a designated  beneficiary or  representative to                                                                    
     change beneficiary  of an  account to  another eligible                                                                    
     individual in the family.                                                                                                  
                                                                                                                                
     Sec.  06.65.190: Distribution  for qualified  expenses.                                                                    
     States that  withdrawals from the program  accounts may                                                                    
     only be used for  qualified expenses for the designated                                                                    
     beneficiary.                                                                                                               
                                                                                                                                
     Sec.  06.65.200:  Rollover   distribution.  Subject  to                                                                    
     federal law governing rollovers,  a distribution from a                                                                    
     program  account can  be made  to  the same  designated                                                                    
     beneficiary  or  another  eligible  individual  in  the                                                                    
     family, and the timeframe for that to be done.                                                                             
                                                                                                                                
     Sec.  06.65.210: Statements.  Requires that  statements                                                                    
     re: program accounts be issued  4 times a year at times                                                                    
     established  by the  department  and  that the  program                                                                    
     contractor   provide   related   information   at   the                                                                    
     department's request.                                                                                                      
                                                                                                                                
     Sec. 06.65.220: Preparation and  filing. In addition to                                                                    
     other reports a financial  contractor shall prepare and                                                                    
     file statements  required under  state and  federal law                                                                    
     and other agencies.                                                                                                        
                                                                                                                                
     Sec.   06.65.230:  Separate   accounting.  Requires   a                                                                    
     financial  contractor  to provide  separate  accounting                                                                    
     for each program account.                                                                                                  
                                                                                                                                
     Sec.   06.65.240:  Annual   fee.  Allows   a  financial                                                                    
     contractor may charge an annual  fee for maintenance of                                                                    
     a program account.                                                                                                         
                                                                                                                                
     Sec. 06.65.250:  Use as  security. Prohibits  a program                                                                    
     account from being used as security for a loan                                                                             
                                                                                                                                
     Sec. 06.65.260: Exemption  from creditor claims. States                                                                    
     that  a program  account is  exempt from  a claim  by a                                                                    
     creditor                                                                                                                   
                                                                                                                                
     Sec. 06.65.270: No state  obligation. Declares that the                                                                    
     program  does not  create an  obligation of  the state,                                                                    
     department, or  any agency to  guarantee the  return of                                                                    
     principal  or  pay  interest  on  the  principal  in  a                                                                    
     program account                                                                                                            
                                                                                                                                
     Sec.   06.65.280:   Confidentiality.   Specifies   that                                                                    
     program account information is confidential                                                                                
                                                                                                                                
     Sec.  06.65.290: Exchange  of  information. Allows  the                                                                    
     Department to exchange  information with the Department                                                                    
     of Health and Social  Services and other state agencies                                                                    
     to determine whether an individual is eligible                                                                             
                                                                                                                                
     Sec.  06.65.300: Treatment  under means  test programs.                                                                    
     Specifies   the  program   account   amounts  must   be                                                                    
     disregarded  in  determining   eligibility  for  means-                                                                    
     tested programs                                                                                                            
                                                                                                                                
     Sec. 06.65.310:  Deposit from permanent  fund dividend.                                                                    
     Allows deposits to program  accounts from the permanent                                                                    
     fund dividend                                                                                                              
                                                                                                                                
     Sec.  06.65.320:  Program   expense  fund.  Establishes                                                                    
     program  expense  fund  and describes  it  purpose  and                                                                    
     operation                                                                                                                  
                                                                                                                                
     Sec. 06.65.330: Medicaid claims:  Allows that the state                                                                    
     may  file a  claim  against the  program  account of  a                                                                    
     beneficiary who dies.                                                                                                      
                                                                                                                                
     Sec. 06.65.340: Governing  law. Establishes federal law                                                                    
     as governing to  the extent of any  conflict with state                                                                    
     law                                                                                                                        
                                                                                                                                
     Sec.  06.65.350: Regulations.  Requires the  department                                                                    
     to adopt implementing regulations                                                                                          
                                                                                                                                
     Sec. 06.65.360: Annual  report. Requires the department                                                                    
     to evaluate  the program each  year and file  an annual                                                                    
     report  on  or before  the  start  of each  legislative                                                                    
     session beginning in 2018                                                                                                  
                                                                                                                                
     Sec. 06.65.390: Definitions.                                                                                               
                                                                                                                                
     Sec. 3:                                                                                                                    
     AS 09.38.015(a): Creates an exemption  for amounts in a                                                                    
     program account                                                                                                            
                                                                                                                                
     Sec.  4: AS  36.30.850(b):  Adds  ABLE program  account                                                                    
     oversight as  a responsibility  of the  Commissioner of                                                                    
     Revenue                                                                                                                    
                                                                                                                                
     Sec  5:  AS  40.25.120(a)   is  amended  to  create  an                                                                    
     exception  to public  inspection for  names, addresses,                                                                    
     and other program account identifying information                                                                          
                                                                                                                                
     Sec.  6  AS  45.55.990(32): Excludes  program  accounts                                                                    
     from the definition of "security"                                                                                          
                                                                                                                                
     Sec. 7: AS 47.07.055: Allows  the state to file a claim                                                                    
     against  the designated  beneficiary's program  account                                                                    
     after the individual dies                                                                                                  
                                                                                                                                
     Sec. 8: Transition                                                                                                         
     Requires  the Department  to file  its first  report on                                                                    
     the program  on or before  the first day of  the Second                                                                    
     Regular Session  of Thirtieth Alaska  State Legislature                                                                    
     (2018)                                                                                                                     
                                                                                                                                
     Sec. 9: Transition                                                                                                         
     Allows  the Department  to adopt  regulations, but  not                                                                    
     before   the   effective   date   of   the   provisions                                                                    
     authorizing the Alaska ABLE savings program                                                                                
                                                                                                                                
     Sec. 10: Effective Date                                                                                                    
     Section 9 takes effect immediately                                                                                         
                                                                                                                                
3:32:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  returned attention to  proposed Section                                                               
06.65.180   [text  previously   provided],  and   questioned  why                                                               
accounts should  be transferred  from the  designated beneficiary                                                               
to another member of the family.                                                                                                
                                                                                                                                
MS. SKIPPER deferred to legal counsel for Autism Speaks.                                                                        
                                                                                                                                
3:33:42 PM                                                                                                                    
                                                                                                                                
STUART  SPIELMAN,  Senior  Policy  Advisor  and  Counsel,  Autism                                                               
Speaks,  stated that  this provision  is consistent  with federal                                                               
law  that provides  for  rollovers  between affected  [qualified]                                                               
family  members.    It  is not  uncommon  that  individuals  with                                                               
disabilities have affected family members.                                                                                      
                                                                                                                                
REPRESENTATIVE JOSEPHSON  returned attention to  proposed Section                                                               
06.65.260  [text  previously  provided],   and  asked  whether  a                                                               
disabled person can enter into a  contract that is lawful, and if                                                               
so, whether the contract is attachable in the case of a dispute.                                                                
                                                                                                                                
MR. SPIELMAN  advised this  is another  provision in  the federal                                                               
law.    An  individual  with  a  disability  is  presumed  to  be                                                               
competent  in most  states; however,  such as  in bankruptcy  law                                                               
that protects  one's housing, there  are certain  protections for                                                               
assets.                                                                                                                         
                                                                                                                                
REPRESENTATIVE  LEDOUX  directed  attention to  proposed  Section                                                               
06.65.260 [text  previously provided],  and pointed out  that the                                                               
account  can  hold  up  to   $400,000,  which  is  a  significant                                                               
exemption, and  presuming that individuals with  disabilities can                                                               
enter into contracts, she expressed her concern.                                                                                
                                                                                                                                
CHAIR  OLSON  opined  that  most  accounts  would  be  for  lower                                                               
amounts.                                                                                                                        
                                                                                                                                
REPRESENTATIVE LEDOUX  agreed, but  the exemption  includes those                                                               
who do have $400,000, and she suggested a cap at a lower level.                                                                 
                                                                                                                                
3:40:33 PM                                                                                                                    
                                                                                                                                
The committee took an at ease from 3:40 p.m. to 3:43 p.m.                                                                       
                                                                                                                                
3:43:12 PM                                                                                                                    
                                                                                                                                
MR.  SPIELMAN,  in response  to  Representative  LeDoux, said  he                                                               
would respond  in writing  to the question  as to  whether states                                                               
could reduce the cap.                                                                                                           
                                                                                                                                
REPRESENTATIVE  HUGHES  directed  attention to  proposed  Section                                                               
06.65.160 [text  previously provided],  and asked  whether excess                                                               
funds must be returned to the designated beneficiary.                                                                           
                                                                                                                                
MS. SKIPPER said correct.                                                                                                       
                                                                                                                                
REPRESENTATIVE  HUGHES  directed  attention to  proposed  Section                                                               
06.65.310 [text  previously provided], and asked  for the purpose                                                               
of  including  a provision  that  allows  for  the deposit  of  a                                                               
permanent fund dividend.                                                                                                        
                                                                                                                                
MS.  SKIPPER  stated  the  sponsor intended  "to  just  like  the                                                               
college savings plan, to have  a check-off box"; however, at this                                                               
time  beneficiaries  would  follow  the procedure  for  a  direct                                                               
deposit.                                                                                                                        
                                                                                                                                
3:45:40 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON,  after ascertaining no  one else wished  to testify,                                                               
closed public testimony,                                                                                                        
                                                                                                                                
[HB 188 was held over.]                                                                                                         
                                                                                                                                
3:46:16 PM                                                                                                                    
                                                                                                                                
The committee took an at ease from 3:46 p.m. to 3:48 p.m.                                                                       
                                                                                                                                
         HB 337-MARIJUANA TAXES;EXCESS POSSESSION;BONDS                                                                     
                                                                                                                                
3:47:52 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  announced that the  next order of business  would be                                                               
HOUSE BILL NO. 337, "An Act relating to taxes on marijuana."                                                                    
                                                                                                                                
3:48:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HUGHES  moved  to adopt  the  proposed  committee                                                               
substitute  (CS)   for  HB  337,  labeled   29-LS1490\H,  Nauman,                                                               
3/10/16, as the working document.                                                                                               
                                                                                                                                
CHAIR OLSON objected for discussion purposes.                                                                                   
                                                                                                                                
3:48:32 PM                                                                                                                    
                                                                                                                                
KALYSSA  MAILE,  Staff  to Representative  LeDoux,  Alaska  State                                                               
Legislature,  sponsor,  informed  the  committee  there  are  two                                                               
substantive changes  in the proposed  CS for  HB 337.   The first                                                               
change is on page 2, lines 14-20, which read:                                                                                   
                                                                                                                                
     Sec.  43.61.050.  Administration   and  enforcement  of                                                                  
     tax.(a)   Each   marijuana  cultivation   facility   is                                                                  
     primarily liable  for the payment  of the  excise taxes                                                                    
     on marijuana  sold and shall  furnish a cash  or surety                                                                    
     bond of $5,000, payable  to the department and approved                                                                    
     by the  Department of Law.  If a  marijuana cultivation                                                                    
     facility  fails  to  pay  the tax  to  the  state,  the                                                                    
     marijuana cultivation  facility forfeits the  bond, and                                                                    
     the   Marijuana  Control   Board   shall  suspend   the                                                                    
     marijuana cultivation facility's  license until payment                                                                    
     is made.                                                                                                                   
                                                                                                                                
MS.  MAILE  said in  response  to  public testimony,  the  $5,000                                                               
bonding requirement  was changed to a  cash or surety bond.   The                                                               
second change is on page 3, line 7, which read:                                                                                 
                                                                                                                                
     Sec.  4. This  Act  takes effect  immediately under  AS                                                                  
     01.10.070(c).                                                                                                              
MS. MAILE said  this section would ensure that the  bill would be                                                               
signed into law before licenses  for marijuana establishments are                                                               
issued.                                                                                                                         
                                                                                                                                
REPRESENTATIVE   JOSEPHSON  has   heard   that   there  are   200                                                               
applications for  commercial marijuana  operations, and  he asked                                                               
when the applications would be accepted or rejected.                                                                            
                                                                                                                                
MS. MAILE  deferred to  the Department  of Commerce,  Community &                                                               
Economic Development.                                                                                                           
                                                                                                                                
3:50:17 PM                                                                                                                    
                                                                                                                                
CHAIR   OLSON  removed   his  objection,   and  without   further                                                               
objection, Version H was before the committee.                                                                                  
                                                                                                                                
REPRESENTATIVE HUGHES  opined that  the tax for  excess marijuana                                                               
is really a penalty or a fine.                                                                                                  
                                                                                                                                
REPRESENTATIVE  LEDOUX responded  that  the amount  would be  the                                                               
same amount as though the business had registered.                                                                              
                                                                                                                                
REPRESENTATIVE  HUGHES   maintained  that   a  penalty   is  more                                                               
appropriate, as she is unfamiliar with a civil tax.                                                                             
                                                                                                                                
3:52:07 PM                                                                                                                    
                                                                                                                                
CHAIR  OLSON reopened  public testimony.   After  ascertaining no                                                               
one wished to testify, public testimony was closed.                                                                             
                                                                                                                                
REPRESENTATIVE JOSEPHSON  returned attention to page  2, lines 6-                                                               
13, which read:                                                                                                                 
                                                                                                                                
     Sec. 43.61.040. Tax for Excess  Marijuana. A person who                                                                  
     is not  registered under AS  17.38 and who is  found to                                                                
     be in possession  of marijuana plants in  excess of the                                                                    
     amount of marijuana plants  authorized for personal use                                                                    
     in  AS  17.38.020(2)  is  subject to  the  tax  on  the                                                                    
     marijuana  plants possessed  in  excess  of the  amount                                                                    
     authorized for use  in AS 17.38.020. The  tax due under                                                                    
     this section is $50 for  each ounce or partial ounce of                                                                    
     marijuana possessed.   When  determining the  weight of                                                                    
     marijuana for purposes of  this section, the department                                                                    
     shall  use the  aggregate  weight  calculated under  AS                                                                    
     11.71.080.                                                                                                                 
                                                                                                                                
REPRESENTATIVE JOSEPHSON  questioned the use of  "not" registered                                                               
instead of "registered or unregistered."                                                                                        
                                                                                                                                
REPRESENTATIVE  LEDOUX  explained  that  when  a  person  is  not                                                               
registered, "personal use doesn't come into play."                                                                              
                                                                                                                                
[HB 337 was held over.]                                                                                                         
                                                                                                                                
3:54:27 PM                                                                                                                    
                                                                                                                                
The committee took an at ease from 3:54 p.m. to 3:56 p.m.                                                                       
                                                                                                                                
        HB 313-PUBLIC CONSTRUCTION CONTRACTS WAGE RATES                                                                     
                                                                                                                                
3:56:18 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  announced that the  next order of business  would be                                                               
HOUSE BILL NO.  313, "An Act relating to  the public construction                                                               
contracts, including the application of prevailing wage rates."                                                                 
                                                                                                                                
3:56:56 PM                                                                                                                    
                                                                                                                                
KONRAD  JACKSON,  Staff  to Representative  Olson,  Alaska  State                                                               
Legislature,  Chair  of the  House  Labor  and Commerce  Standing                                                               
Committee, sponsor, informed  the committee HB 313  makes a minor                                                               
change to the Little Davis-Bacon  Act threshold that public works                                                               
contracts  must meet  before they  quality for  prevailing wages.                                                               
The  bill raises  the threshold  from  $25,000 to  $75,000.   Mr.                                                               
Jackson provided a  brief history of the law,  noting that during                                                               
the  Great Depression  Congress enacted  the federal  Davis-Bacon                                                               
Act  of 1931  that decreed  prevailing wages  are to  be paid  to                                                               
construction   workers  on   federal   public  works   contracts;                                                               
thereafter,  most states  enacted  a similar  law,  known as  the                                                               
Little Davis-Bacon  Act, for the  same purpose.   Alaska's Little                                                               
Davis-Bacon Act (LDBA),  found in AS 36.05, was set  at $2,000 in                                                               
1935,  and was  raised to  $25,000  in 2011.   The  reason for  a                                                               
threshold is  that some  LDBA projects are  too small  to justify                                                               
the  administrative   work  needed   to  meet   LDBA  compliance.                                                               
Currently, a project under $25,000  can be completed without LDBA                                                               
requirements of a certified payroll,  reporting to the Department                                                               
of Labor  & Workforce Development  (DLWD), and filing  with DLWD.                                                               
In Alaska,  a limited  road system  and difficulties  with access                                                               
add  to the  cost of  construction, bringing  many jobs  over the                                                               
$25,000  limit.   He  said the  federal limit  is  based on  easy                                                               
mobilization; in fact,  some other states have  no threshold, and                                                               
of 19  states with  thresholds higher  than $25,000,  the average                                                               
threshold is $140,000.                                                                                                          
                                                                                                                                
4:01:45 PM                                                                                                                    
                                                                                                                                
CHAIR  OLSON  urged  for  a brief  discussion  of  a  forthcoming                                                               
amendment to the bill.                                                                                                          
                                                                                                                                
MR.  JACKSON  said  a  forthcoming  amendment  would  reduce  the                                                               
proposed limit from  $75,000 to $50,000.   The proposed amendment                                                               
also changes  an account  in the general  fund, created  under AS                                                               
44.31.025,  from  the building  safety  account  to the  building                                                               
safety  and  wage protection  account.    Further, the  amendment                                                               
changes  the percentage  of the  workers' compensation  insurance                                                               
premiums that are  paid to the Division  of Insurance, Department                                                               
of Commerce, Community & Economic  Development, but are deposited                                                               
with DLWD, from 1.82 percent to 2.7 percent.                                                                                    
                                                                                                                                
REPRESENTATIVE HUGHES  asked for the inflation  equivalent to the                                                               
$25,000 limit.                                                                                                                  
                                                                                                                                
CHAIR OLSON offered that in 2011,  the 1938 number - after adding                                                               
a  factor  for  inflation  -   was  roughly  equivalent  to  over                                                               
$100,000.   The average  of all of  the participating  states was                                                               
$150,000, with the highest at $300,000  in 2010 or 2011.  He said                                                               
the sponsor's intent was to find a limit to "fit Alaska."                                                                       
                                                                                                                                
REPRESENTATIVE  LEDOUX  asked  for   the  present  equivalent  of                                                               
$25,000 in 2011 dollars.                                                                                                        
                                                                                                                                
CHAIR OLSON was unsure.                                                                                                         
                                                                                                                                
REPRESENTATIVE  JOSEPHSON  referred  to the  burdens  of  filing,                                                               
reporting, and the certification of  payroll.  He asked, "Is that                                                               
the, the true  target of the bill, or is  it about paying workers                                                               
less to save school districts and other entities more?"                                                                         
                                                                                                                                
4:05:13 PM                                                                                                                    
                                                                                                                                
MR. JACKSON  responded that  the ultimate  effect of  raising the                                                               
threshold "is more  bang for the public  construction dollar," by                                                               
eliminating the  burdens.  He  gave an example from  his personal                                                               
experience that his wages at  a construction company were $18 per                                                               
hour, which went  up to over $30 with benefits  when working on a                                                               
public construction project.                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON related that  the state has dramatically                                                               
reduced the capital  budget; he surmised that the  bill is partly                                                               
an outfall of the budget  crisis, and questioned whether the bill                                                               
is "sort of a de facto tax on the worker."                                                                                      
                                                                                                                                
MR. JACKSON said he did not consider the bill a tax.                                                                            
                                                                                                                                
REPRESENTATIVE LEDOUX asked whether the  bill is supported by the                                                               
Alaska Municipal League (AML).                                                                                                  
                                                                                                                                
MR. JACKSON  responded that AML will  not take a position  on the                                                               
bill;  however, the  sponsor has  heard  that municipalities  are                                                               
saving on  construction projects  since the previous  increase to                                                               
$25,000,  and  has  received  letters   of  support  from  school                                                               
districts, municipalities, and a hospital.                                                                                      
                                                                                                                                
CHAIR OLSON added that the bill  is not on AML's priority list at                                                               
this time.                                                                                                                      
                                                                                                                                
4:09:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE COLVER  asked for information  on the fee  that is                                                               
charged to  public construction  projects for  the administration                                                               
of certified payrolls.                                                                                                          
                                                                                                                                
MR.  JACKSON  directed  attention   to  the  bill's  fiscal  note                                                               
Identifier: HB313-DOLWD-WHA-02-18-16.                                                                                           
                                                                                                                                
REPRESENTATIVE  COLVER  clarified  that  he was  referring  to  a                                                               
policy that  is in  place:   when a company  is awarded  a public                                                               
construction contract,  it has  to pay  DLWD -  on a  certain fee                                                               
structure - to administer a certified payroll.                                                                                  
                                                                                                                                
MR. JACKSON pointed out the fiscal  note showed a loss to DLWD of                                                               
$125,000, based on the current iteration  of the bill which has a                                                               
$75,000 threshold.                                                                                                              
                                                                                                                                
REPRESENTATIVE HUGHES inquired  as to why other  states have much                                                               
higher thresholds.                                                                                                              
                                                                                                                                
MR. JACKSON  advised that Maryland  has the highest  threshold at                                                               
$500,000, and other states have none.                                                                                           
                                                                                                                                
CHAIR OLSON acknowledged  Representative Wilson's contribution to                                                               
the forthcoming amendment.                                                                                                      
                                                                                                                                
REPRESENTATIVE LEDOUX asked for an  estimate on how much the bill                                                               
would save the state.                                                                                                           
                                                                                                                                
MR.  JACKSON restated  that the  fiscal note  reflects a  loss to                                                               
DLWD of  $125,000 [document not  provided]; with the  adoption of                                                               
the forthcoming  amendment "that number radically  changes in the                                                               
other direction."  Also, the  estimate would depend on the number                                                               
of affected construction projects.                                                                                              
                                                                                                                                
CHAIR  OLSON   added  that  road  service   areas  are  affected,                                                               
particularly in the Fairbanks area.                                                                                             
                                                                                                                                
4:13:55 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX observed that the  bill is supposed to help                                                               
cities and boroughs,  but the committee has  not received letters                                                               
of support from cities and boroughs.                                                                                            
                                                                                                                                
CHAIR OLSON said letters of support are forthcoming.                                                                            
                                                                                                                                
REPRESENTATIVE HUGHES acknowledged the bill  may be seen as a tax                                                               
on  workers;  however,  the  threshold  levies  a  tax  on  local                                                               
entities, cities and boroughs, and  school districts.  She opined                                                               
that  states that  do  not  have thresholds  can  get more  done,                                                               
therefore, for state projects, that would  be a tax on the people                                                               
of Alaska.                                                                                                                      
                                                                                                                                
CHAIR OLSON  recalled that  four or  five years  ago, one  or two                                                               
union contractors testified  in favor of "the  bill," saying that                                                               
they  were  losing  money  because  of the  work  involved  in  a                                                               
certified payroll.                                                                                                              
                                                                                                                                
MR. JACKSON  pointed out  18 states do  not have  prevailing wage                                                               
laws.                                                                                                                           
                                                                                                                                
CHAIR OLSON opened public testimony on HB 313.                                                                                  
                                                                                                                                
4:17:34 PM                                                                                                                    
                                                                                                                                
CHRIS DIMOND stated  he is a 15-year member  of Carpenter's Local                                                               
1281 and was speaking on his  own behalf in opposition to HB 313.                                                               
The bill  would only benefit  unscrupulous contractors  who would                                                               
not pay  highly-skilled workers a  fair wage.  Raising  the limit                                                               
of  the Little  Davis-Bacon Act  simply provides  more income  to                                                               
contractors and removes  skilled labor from projects.   Without a                                                               
prevailing wage  law, contractors  hire those who  are unskilled,                                                               
desperate, and  willing to work for  less.  This is  a disservice                                                               
to  the state:   1.)  unskilled and  untrained workers  raise the                                                               
cost of projects because of shoddy  work, there is an increase in                                                               
accidents and deaths  because of the lack of  training, and there                                                               
are  exaggerated maintenance  costs as  a result  of the  initial                                                               
work performed  by unskilled workers; 2.)  highly-trained men and                                                               
women are  put out  of work by  removing honest  contractors from                                                               
biddable projects.  Mr. Dimond  said increasing the Little Davis-                                                               
Bacon  Act to  $50,000  will reduce  17 percent  of  the jobs  he                                                               
performs, which  is a huge cut  to his family and  to contractors                                                               
who bid  on smaller  projects.   His training  and certifications                                                               
enable him to  earn a fair and livable wage,  and thus contribute                                                               
to  the  state  and  the   community  through  paying  taxes  and                                                               
spending; cutting  wages does not  save money, and he  asked that                                                               
the committee not pass the proposed legislation.                                                                                
                                                                                                                                
4:20:17 PM                                                                                                                    
                                                                                                                                
MAX  MIELKE, Business  Manager,  Plumbers  and Pipefitters  Local                                                               
262,  informed the  committee his  local  represents 100  members                                                               
throughout Southeast  Alaska.  He  said HB  313 is not  a worker-                                                               
friendly bill even with a threshold  of $50,000.  Mr. Mielke said                                                               
he  represents many  small contractors  and recalled  that during                                                               
times of recession,  the small jobs "kept us  going."  Presently,                                                               
approximately 30 percent  of jobs are less than  $50,000, and the                                                               
budget deficit  looms.   Over the last  12 years,  30 apprentices                                                               
have  gone  through the  training  center  and are  working;  the                                                               
training center program costs $300,000  per year and has students                                                               
from  all   over  Southeast,   and  graduates   a  highly-skilled                                                               
workforce.   He stressed that  smaller jobs are important  to the                                                               
towns in Southeast, and acknowledged  that he supports aspects of                                                               
the bill.                                                                                                                       
                                                                                                                                
4:23:28 PM                                                                                                                    
                                                                                                                                
MIKE STURROCK said Island Contractors  is a small business and 20                                                               
percent of  its work is  smaller projects that  require certified                                                               
payroll.   He said certified payroll  is already part of  his job                                                               
and is not hard to do  on projects from $500,000, down to $1,000.                                                               
The certified payroll fee is 1  percent paid to the Department of                                                               
Labor  &  Workforce  Development  with  a cap  at  $5,000.    Mr.                                                               
Sturrock expressed his  support for moving 1 percent  more of the                                                               
service fees to the department,  but raising the threshold of the                                                               
Little Davis-Bacon Act does not help workers or wages.                                                                          
                                                                                                                                
CHAIR  OLSON  advised that  the  fees  are being  transferred  to                                                               
enforcement.   He stated that  there were no complaints  when the                                                               
limit was increased to $25,000,  with the exception of an out-of-                                                               
state contractor.                                                                                                               
                                                                                                                                
MR. STURROCK  restated that his  business does  certified payroll                                                               
on all projects, and he does not support the bill.                                                                              
                                                                                                                                
4:27:23 PM                                                                                                                    
                                                                                                                                
PAUL GROSSI  said was  he was  speaking on  behalf of  the Alaska                                                               
State  Pipe   Trades  and  the   Ironworkers.      He   said  the                                                               
organizations  he represents  oppose  the bill  because it  would                                                               
lower the  wages of  employees in general,  which would  hurt the                                                               
local  economy  because lower  wages  mean  less spending  money.                                                               
Also, the bill  would eliminate the local hire  provisions of the                                                               
Little Davis-Bacon Act, thus more  contractors would hire workers                                                               
from  out-of-town and  from out-of-state,  and local  money would                                                               
leave the state.   He encouraged the legislature  to not increase                                                               
the problem  of money leaving  the state,  because it is  bad for                                                               
the economy and for working people.                                                                                             
                                                                                                                                
REPRESENTATIVE  HUGHES  questioned  whether local  hire  includes                                                               
communities, or just instate [Alaska].                                                                                          
                                                                                                                                
MR. GROSSI answered that employers  usually hire within the local                                                               
community first.                                                                                                                
                                                                                                                                
REPRESENTATIVE  HUGHES   further  inquired  as  to   the  federal                                                               
requirement of instate hire.                                                                                                    
                                                                                                                                
MR. GROSSI explained  that the Little Davis-Bacon Act  is a state                                                               
law.                                                                                                                            
                                                                                                                                
4:29:59 PM                                                                                                                    
                                                                                                                                
RODNEY  HESSON   said  he  was  representing   the  International                                                               
Brotherhood of  Electrical Workers  Local 1547, and  is president                                                               
of  the Juneau  Building  Trades  Council.   He  stated that  the                                                               
organizations he represents oppose HB 313.                                                                                      
                                                                                                                                
4:31:15 PM                                                                                                                    
                                                                                                                                
KIRK PERISICH,  Southeast Representative, Carpenters  Local 1281,                                                               
said  he  also  represents  Piledrivers and  Millwrights  in  the                                                               
Southeast area.  He expressed his  opposition to HB 313, and said                                                               
the bill  has some good  aspects, but raising the  threshold does                                                               
not help workers and does  not help contractors, except for those                                                               
who are trying to break the  rules.  In fact, the bill eliminates                                                               
certified payrolls  and ways to  track contractors who  may abuse                                                               
the  system.   Alaska  has  "some  of the  weakest  subcontractor                                                               
language," and raising  the threshold may encourage  an influx of                                                               
more  contractors who  would not  pay the  prevailing rate.   Mr.                                                               
Perisich restated his position on the bill.                                                                                     
                                                                                                                                
4:33:50 PM                                                                                                                    
                                                                                                                                
DAVE REAVES  stated his  opposition to  HB 313.   He  pointed out                                                               
that the previous increase was just  five years ago and this is a                                                               
100  percent  increase.    Mr.  Reaves  has  been  informed  that                                                               
construction  costs  do  not decrease,  but  employee  wages  are                                                               
lowered,  some below  the poverty  line.   He supported  previous                                                               
testimony in opposition to the bill.                                                                                            
                                                                                                                                
CHAIR OLSON commented  that he represents everybody  in the state                                                               
and  was asked  to revisit  this matter.   He  noted that  he has                                                               
worked  extensively  with DLWD  on  various  issues over  a  long                                                               
period of time.                                                                                                                 
                                                                                                                                
4:36:45 PM                                                                                                                    
                                                                                                                                
WAYLON KNUDSEN  stated he was strongly  opposed to the bill.   He                                                               
recalled that  the change in  2011 was originally to  be $75,000.                                                               
Although the discussion has been  directed toward small projects,                                                               
$75,000  is a  threshold that  captures 26  percent of  all state                                                               
projects  - he  was  unsure  of the  percentage  that fall  under                                                               
$50,000 - and  swings the door open to outside  contractors.  Mr.                                                               
Knudsen urged the committee to vote against the bill.                                                                           
                                                                                                                                
4:38:37 PM                                                                                                                    
                                                                                                                                
KEVIN POMEROY, Business Manager, Labor's  Local 942, said he also                                                               
serves as Road Service Area  Commissioner for the Fairbanks North                                                               
Star Borough.   Mr.  Pomeroy spoke  against HB  313, which  is an                                                               
effort  to  cut  construction  costs by  putting  the  burden  on                                                               
Alaskan craftsmen and  craftswomen to earn less.   He referred to                                                               
numerous studies that lowering workers'  wages would allow states                                                               
and municipalities to build more  schools [studies not provided].                                                               
He pointed  out that labor  accounts for  about 18 percent  to 23                                                               
percent  of  a  project's  cost,  thus  claims  that  not  paying                                                               
prevailing wages will  cut the cost of the project  by 20 percent                                                               
to  30 percent  are inaccurate.   Further,  another study  showed                                                               
that the  impact of higher  wages on  cost is compensated  by the                                                               
positive  effects   on  productivity   and  quality   [study  not                                                               
provided].   Mr. Pomeroy referred  to a bid study  that indicated                                                               
the differences  in mean  square foot cost  were small,  none, or                                                               
even cheaper [study not provided].   Prevailing wage laws require                                                               
that construction  workers on public  projects be paid  the wages                                                               
found by DLWD to prevail for  similar work in the locality, along                                                               
with  provisions to  require Alaska-hire  and the  utilization of                                                               
apprentices from  a federally registered  apprenticeship program;                                                               
however,   lowering   the   threshold   would   eliminate   these                                                               
provisions.  He listed the  various aspects of a contract bidding                                                               
process, and questioned  why workers' wages are  always looked at                                                               
first to  cut costs.   Mr. Pomeroy  urged the committee  to allow                                                               
workers  to continue  to  bring  efficiencies, productivity,  and                                                               
quality.                                                                                                                        
                                                                                                                                
4:43:50 PM                                                                                                                    
                                                                                                                                
LARRY  TALBERT,   Business  Manager,  Local  367,   Plumbers  and                                                               
Steamfitters,  expressed his  strong opposition  to HB  313.   He                                                               
said he respects legislators who  deal with difficult issues. The                                                               
Little   Davis-Bacon   Act   guarantees   fair   competition   by                                                               
establishing a local  wage standard that contractors  must pay on                                                               
public  projects, which  provides a  level playing  field, rather                                                               
than rewarding  those who  slash workers' wages  in order  to win                                                               
bids.    The  Act  also  protects  the  state  from  fly-by-night                                                               
contractors  who provide  inferior work.   Mr.  Talbert supported                                                               
previous testimony,  and stressed  that increasing  the threshold                                                               
would  lower the  wages  of  hardworking men  and  women who  are                                                               
hampered by legislation such as HB 313.                                                                                         
                                                                                                                                
4:46:14 PM                                                                                                                    
                                                                                                                                
ROCKY KNUDSEN stated that the bill  would put money in the pocket                                                               
of the  employer that should  be paid  to employees in  wages and                                                               
benefits.   Small state  contracts often  come from  state grants                                                               
without vigorous competitive bidding, and  the money is there for                                                               
workers'  wages.   Mr.  Knudsen said  he  worked in  construction                                                               
until retiring in 1975, and  advised that his retirement was paid                                                               
for  by his  wage package;  however, others  did not  make enough                                                               
money  to save  for  retirement.   He opined  the  bill is  about                                                               
"keeping  the  workers hungry,  so  the  employers can  reap  the                                                               
profits."                                                                                                                       
                                                                                                                                
4:48:34 PM                                                                                                                    
                                                                                                                                
BRANDON CALCATERRO informed the committee  he has lived in Alaska                                                               
for  28  years  and  graduated  from  the  University  of  Alaska                                                               
Anchorage.   He lives with his  wife and three daughters  and his                                                               
family enjoys a high quality of  life.  Mr. Calcaterro said he is                                                               
opposed to  HB 313 because  when workers are paid  the prevailing                                                               
wage they  are 8  percent more likely  to have  health insurance,                                                               
which is  important for a  community's morale, and are  4 percent                                                               
more likely  to have a retirement  plan, which allows for  a more                                                               
positive  lifestyle.   Financial stress  is a  leading factor  in                                                               
failed marriages, domestic violence,  and is detrimental to young                                                               
children.   Construction workers  in prevailing wage  states earn                                                               
17 percent more,  and thus have more options  for their families.                                                               
Mr. Calcaterro stated that everybody  suffers when neighbors need                                                               
public  assistance, and  urged the  committee to  support a  high                                                               
quality of life in Alaska.                                                                                                      
                                                                                                                                
4:50:32 PM                                                                                                                    
                                                                                                                                
SUZANNE MCCARTHY, Spokesperson,  Alaska Laborers Training School,                                                               
stated  her opposition  to  HB  313.   Ms.  McCarthy referred  to                                                               
previous  testimony about  the burdens  of  paperwork and  agreed                                                               
with the facts  that these costs are not directly  related to the                                                               
cost of  the workers' wages.   She advised that  prevailing wages                                                               
do not  affect wages for construction  managers, supervisors, and                                                               
others who  are paid a much  higher wage; in fact,  the burden is                                                               
on the  young men and  women who  are working construction.   The                                                               
Alaska Laborers Training School  provides students with skills to                                                               
be  competitive,  and  they are  highly  trained  and  qualified,                                                               
thereby  saving   project  costs.     In  addition,   local  hire                                                               
strengthens  the  economy,  helps  minorities,  helps  close  the                                                               
income  gap and  - during  a time  of economic  stresses -  small                                                               
projects statewide are important.   Although construction work is                                                               
transitory,  workers  are professionals  and  should  be paid  as                                                               
such.                                                                                                                           
                                                                                                                                
4:53:54 PM                                                                                                                    
                                                                                                                                
JULIUS MATHEW advised  the committee on the  following effects of                                                               
raising  the  threshold  on  prevailing   wage  in  Alaska:    on                                                               
construction  workers  and  their families:    more  construction                                                               
workers and  their families would depend  upon public assistance,                                                               
and  would   lack  health  care  or   retirement  benefits;  more                                                               
construction workers  would slip  below poverty line;  the morale                                                               
of the workers and their families  and how they feel about living                                                               
in Alaska;   on the economy:  considering the  $3.8 billion state                                                               
budget deficit, taking  money out of the hands of  residents is a                                                               
bad business decision;   on construction aspects:   labor cost is                                                               
a small  part of the total  cost of a project;  reducing the wage                                                               
does  not  increase  bidding competition;  higher  wages  attract                                                               
highly-skilled workers and higher production  and safety.  A 2015                                                               
study  looked  at  the  adverse   economic  impact  of  repealing                                                               
prevailing wage law  in West Virginia [study not  provided].  Mr.                                                               
Mathew  said   construction  workers   in  states  that   have  a                                                               
prevailing wage  law have a  higher average income than  those in                                                               
states that have not, and he  listed the different wages in other                                                               
states,  concluding  that reducing  the  prevailing  wage in  the                                                               
state  is  not  in  the best  interest  of  Alaskan  construction                                                               
workers.   He provided statistics  from Wisconsin  that indicated                                                               
construction  workers  are expected  to  fall  below the  poverty                                                               
line,  rely  on food  stamps,  lose  health insurance,  and  lose                                                               
employer-provided pensions.    He cautioned  that workers without                                                               
pension plans  end up  depending upon  the state  at the  time of                                                               
their retirement.  Mr. Mathew strongly opposed HB 313.                                                                          
                                                                                                                                
4:57:43 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON announced public testimony would remain open.                                                                       
                                                                                                                                
[HB 313 was held over.]                                                                                                         
                                                                                                                                
4:58:03 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Labor and  Commerce Standing Committee  meeting was  adjourned at                                                               
[4:58] p.m.                                                                                                                     

Document Name Date/Time Subjects
HB188 Draft Proposed Blank CS ver E.pdf HL&C 3/16/2016 3:15:00 PM
HB 188
HB188 Sectional Analysis for Draft Proposed Blank CS ver E.pdf HL&C 3/16/2016 3:15:00 PM
HB 188
HB188 Sponsor Statement.pdf HL&C 3/16/2016 3:15:00 PM
HB 188
HB188 Supporting Documents-Written Testimony Edith McCusker 03-09-16.pdf HL&C 3/16/2016 3:15:00 PM
HB 188
HB337 Draft Proposed Blank CS ver H.pdf HL&C 3/16/2016 3:15:00 PM
HB 337
HB313 Draft Proposed Amendment A.2.pdf HL&C 3/16/2016 3:15:00 PM
HB 313
HB133 Amendment A.2 Sectional Analysis.pdf HL&C 3/16/2016 3:15:00 PM
HB 133
HB313 Opposing Documents-Letter-Teamsters Local 959 03-15-16.pdf HL&C 3/16/2016 3:15:00 PM
HB 313
HB313 Opposing Documents-Written Testimony Wesley Canfield 03-14-16.pdf HL&C 3/16/2016 3:15:00 PM
HB 313
HB313 Supporting Documents-Letter-NFIB 03-14-16.PDF HL&C 3/16/2016 3:15:00 PM
HB 313
HB313 Opposing Documents-Letter-International Union of Operating Engineers 03-14-16.PDF HL&C 3/16/2016 3:15:00 PM
HB 313
HB263 ver A.pdf HL&C 3/16/2016 3:15:00 PM
HB 263
HB263 Transmittal Letter.pdf HL&C 3/16/2016 3:15:00 PM
HB 263
HB263 Sectional Analysis.pdf HL&C 3/16/2016 3:15:00 PM
HB 263
HB263 Fiscal Note-DOLWD-OSH-11-17-15.pdf HL&C 3/16/2016 3:15:00 PM
HB 263
HB313 Sectional Analysis Amendment A.2 .pdf HL&C 3/16/2016 3:15:00 PM
HB 313