Legislature(2017 - 2018)BARNES 124

05/12/2017 03:15 PM LABOR & COMMERCE

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Audio Topic
03:28:26 PM Start
03:29:08 PM HB132
03:42:22 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Delayed to approx. 10 Minutes After Session --
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 132 TRANSPORTATION NETWORK COMPANIES TELECONFERENCED
Moved CSHB 132(L&C) Out of Committee
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                          May 12, 2017                                                                                          
                           3:28 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Sam Kito, Chair                                                                                                  
Representative Adam Wool, Vice Chair                                                                                            
Representative Andy Josephson                                                                                                   
Representative Louise Stutes                                                                                                    
Representative Chris Birch                                                                                                      
Representative Colleen Sullivan-Leonard                                                                                         
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Gary Knopp                                                                                                       
Representative Mike Chenault (alternate)                                                                                        
Representative Bryce Edgmon (alternate)                                                                                         
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 132                                                                                                              
"An Act relating to transportation network companies and                                                                        
transportation network company drivers."                                                                                        
                                                                                                                                
     - MOVED CSHB 132(L&C) OUT OF COMMITTEE                                                                                     
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 132                                                                                                                  
SHORT TITLE: TRANSPORTATION NETWORK COMPANIES                                                                                   
SPONSOR(s): REPRESENTATIVE(s) WOOL                                                                                              
                                                                                                                                
02/15/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/15/17       (H)       TRA, L&C                                                                                               
02/23/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
02/23/17       (H)       <Bill Hearing Canceled>                                                                                
02/28/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
02/28/17       (H)       Heard & Held                                                                                           
02/28/17       (H)       MINUTE(TRA)                                                                                            
03/02/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
03/02/17       (H)       Heard & Held                                                                                           
03/02/17       (H)       MINUTE(TRA)                                                                                            
03/06/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/06/17       (H)       Scheduled but Not Heard                                                                                
03/07/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
03/07/17       (H)       Moved CSHB 132(TRA) Out of Committee                                                                   
03/07/17       (H)       MINUTE(TRA)                                                                                            
03/08/17       (H)       TRA RPT CS(TRA) 1DP 4NR 2AM                                                                            
03/08/17       (H)       DP: WOOL                                                                                               
03/08/17       (H)       NR: SULLIVAN-LEONARD, NEUMAN, DRUMMOND,                                                                
                         STUTES                                                                                                 
03/08/17       (H)       AM: CLAMAN, KOPP                                                                                       
03/10/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/10/17       (H)       Heard & Held                                                                                           
03/10/17       (H)       MINUTE(L&C)                                                                                            
03/17/17       (H)       L&C AT 3:15 PM CAPITOL 106                                                                             
03/17/17       (H)       Heard & Held                                                                                           
03/17/17       (H)       MINUTE(L&C)                                                                                            
03/18/17       (H)       L&C AT 12:30 AM CAPITOL 106                                                                            
03/18/17       (H)       -- Continued from 3/17/17 --                                                                           
03/22/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/22/17       (H)       Heard & Held                                                                                           
03/22/17       (H)       MINUTE(L&C)                                                                                            
03/24/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/24/17       (H)       Heard & Held                                                                                           
03/24/17       (H)       MINUTE(L&C)                                                                                            
05/12/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
LAURA STIDOLPH, Staff                                                                                                           
Representative Adam Wool                                                                                                        
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Explained the changes that would be made                                                                 
under the proposed CS to HB 132, Version T, on behalf of                                                                        
Representative Wool, prime sponsor.                                                                                             
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:28:26 PM                                                                                                                    
                                                                                                                                
CHAIR  SAM KITO  called  the House  Labor  and Commerce  Standing                                                             
Committee  meeting  to  order  at   3:28  p.m.    Representatives                                                               
Sullivan-Leonard, Stutes,  Birch, Josephson, Wool, and  Kito were                                                               
present at the call to order.                                                                                                   
                                                                                                                                
            HB 132-TRANSPORTATION NETWORK COMPANIES                                                                         
                                                                                                                                
3:29:08 PM                                                                                                                    
                                                                                                                                
CHAIR KITO  announced that  the only order  of business  would be                                                               
HOUSE BILL  NO. 132, "An  Act relating to  transportation network                                                               
companies and  transportation network company drivers."   [Before                                                               
the committee, adopted as a  working document on 3/22/17, was the                                                               
proposed  committee  substitute  (CS)  for HB  132,  Version  30-                                                               
LS0522\R.1, Wallace, 3/21/17.]                                                                                                  
                                                                                                                                
3:29:24 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  WOOL  moved  to   adopt  the  proposed  committee                                                               
substitute  (CS)  for  HB   132,  Version  30-LS0522\T,  Wallace,                                                               
5/8/17, as a working document.                                                                                                  
                                                                                                                                
3:29:36 PM                                                                                                                    
                                                                                                                                
CHAIR KITO objected for the purpose of discussion.                                                                              
                                                                                                                                
3:29:54 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease at 3:30 p.m.                                                                                 
                                                                                                                                
3:30:41 PM                                                                                                                    
                                                                                                                                
LAURA  STIDOLPH, Staff,  Representative Adam  Wool, Alaska  State                                                               
Legislature, explained the  changes that would be  made under the                                                               
proposed CS  to HB  132, Version T,  on behalf  of Representative                                                               
Wool, prime sponsor.   She brought attention to a  handout in the                                                               
committee packet, labeled "Work Draft for  CS for HB 132 ver R to                                                               
Work  Draft for  CS for  HB 132  ver T  Explanation of  Changes,"                                                               
which read  as follows [original punctuation  provided, with some                                                               
formatting changes]:                                                                                                            
                                                                                                                                
     This  work draft  CS incorporates  changes made  to the                                                                    
     companion  legislation which  was passed  by the  other                                                                    
     body. There  was also some  clean up  and clarification                                                                    
     to  the  amendments  that passed  in  the  other  body.                                                                    
     Additionally, a few other changes  have been made which                                                                    
     will be explained later.                                                                                                   
                                                                                                                                
     Section 6:                                                                                                                 
                                                                                                                                
     Page   5,  Line   7,   remove  "international   airport                                                                    
     regulations and arrangements"                                                                                              
                                                                                                                                
     Page 5, Line  10, remove "Except as provided  in (b) of                                                                    
     this section,"                                                                                                             
                                                                                                                                
     These  two  changes  were  made  to  simply  move  this                                                                    
     language to a later part of Section 6.                                                                                     
                                                                                                                                
     Page 9, Line 6, add                                                                                                        
     "(b) This  section does  not apply to  AS 23.20  if the                                                                    
     transportation network company is  owned or operated by                                                                    
     the  state,  a  municipality,  a  federally  recognized                                                                    
     tribe,  or  an  entity  that  is  exempt  from  federal                                                                    
     taxation  under 26  U.S.C. 501(c)(3)  (Internal Revenue                                                                    
     Code).                                                                                                                     
                                                                                                                                
     This  change was  by request  of the  US Department  of                                                                    
     Labor, Employment  and Training Administration,  to the                                                                    
     Alaska  Department of  Labor and  Workforce Development                                                                    
     for  conformity  to Federal  unemployment  compensation                                                                    
     (UC)  law. In  order to  preserve the  tax credits  now                                                                    
     available  to Alaska  employers, this  provision needed                                                                    
     to  be   added  to  make   it  clear  that   the  state                                                                    
     unemployment  tax must  be paid  for  all employees  of                                                                    
     state and  local governments,  Indian tribes,  and non-                                                                    
     profit organization. Any  exclusion from the definition                                                                    
     of employment must not apply to these entities.                                                                            
                                                                                                                                
     Pages 10, Line 1, add                                                                                                      
     "(b) A  transportation network company may  not allow a                                                                    
     driver  to accept  trip  requests  through its  digital                                                                    
     network if the driver                                                                                                      
          1) has, in the past three years,                                                                                      
               (A) been  convicted of or forfeited  bail for                                                                    
     a third or subsequent moving traffic violation;                                                                            
               B) been convicted of                                                                                             
                    (i)  driving   while  license  canceled,                                                                    
     suspended,  revoked, or  in violation  of a  limitation                                                                    
     under AS 28.15.291;                                                                                                        
                    (ii)  failure to  stop at  the direction                                                                    
     of a peace officer under AS 28.35.182;                                                                                     
                    (iii)  reckless   or  negligent  driving                                                                    
     under AS.28.35.400 or 28.35.41; or                                                                                         
                    (iv)  a  law  or  ordinance  of  another                                                                    
     jurisdiction  having  similar  elements to  an  offense                                                                    
     listed in (i)  (iii) of this subparagraph;                                                                                 
          (2) has,  in the past seven  years, been convicted                                                                    
     of                                                                                                                         
               (A)  any  offense  that is  an  unclassified,                                                                    
     class  A,  or  class  B   felony  in  this  or  another                                                                    
     jurisdiction; or                                                                                                           
               (B) a misdemeanor involving                                                                                      
                    (i)  a  crime  under  AS  28.33.030,  AS                                                                    
     28.35.030, or 28.35.032                                                                                                    
                    (ii)  a  crime  under  AS  28.35.050  or                                                                    
     28.35.060                                                                                                                  
                    (iii) a crime against  a person under AS                                                                    
     11.41; or                                                                                                                  
                    (iv)  a  law  or  ordinance  of  another                                                                    
     jurisdiction  having  similar  elements to  an  offense                                                                    
     listed in (i)  (iii) of this subparagraph;                                                                                 
          (3) is  listed on the United  States Department of                                                                    
     Justice National Sex Offender Public Website; or                                                                           
          (4) is under 21 years of age.                                                                                         
     (c)  A transportation  network company  driver may  not                                                                    
          (1)   provide  a   prearranged  ride   unless  the                                                                    
     transportation network  company rider has  been matched                                                                    
     to  the  driver  through  the digital  network  of  the                                                                    
     transportation network company;                                                                                            
          (2)  solicit  a  rider  or accept  a  street  hail                                                                    
     request for a ride; or                                                                                                     
          (3)  solicit or  accept cash  payments for  a fare                                                                    
     from a rider"                                                                                                              
                                                                                                                                
     This  addition was  made to  clean up  language in  the                                                                    
     three year  driving history  look-back, and  seven year                                                                    
     criminal history  look-back that  was in  the companion                                                                    
     version  passed by  the  other body.  If  a person  has                                                                    
     committed   a   violent   crime,   either   felony   or                                                                    
     misdemeanor,  in  the past  seven  years  they may  not                                                                    
     drive for  a [transportation network company]  (TNC). A                                                                    
     conviction  of any  unclassified, class  A, or  class B                                                                    
     felony in  the past seven  year will also  disqualify a                                                                    
     person as  a driver.  The new  language makes  it clear                                                                    
     that a driver on the  US DOJ National Sex Offender list                                                                    
     may not  drive for a  TNC. Also,  if a person  has been                                                                    
     convicted   of  driving   under  the   influence  while                                                                    
     operating  a vehicle  or watercraft  in the  past seven                                                                    
     years they may not drive for a TNC.                                                                                        
                                                                                                                                
     A driver must be 21 years  of age. This change was made                                                                    
     due to  state statute regarding alcohol  and marijuana,                                                                    
     so  if either  substance was  left in  the car  after a                                                                    
     rider had  disembarked the driver wouldn't  be breaking                                                                    
     state law by being in possession.                                                                                          
                                                                                                                                
     The  final language  in this  subsection  was added  to                                                                    
     make clear that TNC drivers  may only accept rides from                                                                    
     the TNC platform,  that they do not  operate like other                                                                    
     for-hire  vehicles by  soliciting  riders or  accepting                                                                    
     street  hails,  and  that  the  payment  is  through  a                                                                    
     cashless  system.  Payment  in this  section  does  not                                                                    
     include tips, which can be cash.                                                                                           
                                                                                                                                
     Page 11, line 3, add                                                                                                       
     "Sec.   28.23.105    Transportation   network   company                                                                    
     vehicles. (a)  Before a transportation  network company                                                                    
     allows an  individual to  accept trip  requests through                                                                    
     its digital  network and before a  personal vehicle may                                                                    
     be  used  to  provide  transportation  network  company                                                                    
     services,  the  transportation  network  company  shall                                                                    
     conduct,  or  confirm  satisfactory  completion  of,  a                                                                    
     safety   inspection   of  the   individual's   personal                                                                    
     vehicle.  The  safety  inspection required  under  this                                                                    
     subsection must include an  inspection of the following                                                                    
     components of the personal vehicle:                                                                                        
          (1) foot brakes;                                                                                                      
          (2) parking brakes;                                                                                                   
          (3) steering mechanism;                                                                                               
          (4) windshield;                                                                                                       
          (5) rear window and other glass;                                                                                      
          (6) windshield wipers;                                                                                                
          (7) headlights;                                                                                                       
          (8) taillights;                                                                                                       
          (9) brake lights;                                                                                                     
          (10) front seat adjustment mechanism;                                                                                 
          (11) doors;                                                                                                           
          (12) turn signal lights;                                                                                              
          (13) horn;                                                                                                            
          (14) speedometer;                                                                                                     
          (15) bumpers;                                                                                                         
          (16) muffler and exhaust system;                                                                                      
          (17) tires, including tread depth;                                                                                    
          (18) interior and exterior mirrors;                                                                                   
          (19) safety belts                                                                                                     
                                                                                                                                
     (b) A  motor vehicle that  is used by  a transportation                                                                    
     network  company  driver   for  transportation  network                                                                    
     company purposes may not be more than 12 years of age.                                                                     
                                                                                                                                
     This language, which is standard  terms of services for                                                                    
     major  companies  like  Uber  and Lyft,  was  added  to                                                                    
     statute so that  every TNC operating in  Alaska will be                                                                    
     held  to  a  high   standard  for  vehicle  safety  and                                                                    
     quality.                                                                                                                   
                                                                                                                                
     Page  12, Line  16, add  "Sec 28.23.130.  International                                                                    
     airports. The  Department of Transportation  and Public                                                                    
     Facilities may, under AS 02.15,  enter into a contract,                                                                    
     lease,  or  other  arrangement  with  a  transportation                                                                    
     network  company for  use of  an international  airport                                                                    
     owned or operated  by the state. A  contract, lease, or                                                                    
     arrangement  under AS  02.15  must  be consistent  with                                                                    
     this chapter."                                                                                                             
                                                                                                                                
     This  change was  made in  a different  version of  the                                                                    
     bill but was moved to its  own subsection at the end of                                                                    
     Section  6. As  explained previously,  this change  was                                                                    
     made  in  a committee  substitute  work  draft in  this                                                                    
     committee after  the bill  sponsor had  been approached                                                                    
     by DOT about inserting  language into statute regarding                                                                    
     international airports.                                                                                                    
                                                                                                                                
     Section 8 Page 14, Lines 10-13, add                                                                                        
     "(c)  Notwithstanding  AS  28.01.010  or  (a)  of  this                                                                    
     section, a  municipality may  by ordinance  ratified by                                                                    
     the  voters in  a regular  municipal election  prohibit                                                                    
     transportation   network   companies  from   conducting                                                                    
     activities under AS 28.23 within the municipality."                                                                        
                                                                                                                                
     This language was  added to add a  local opt-out option                                                                    
     by a decision  of the people as to whether  or not they                                                                    
     want  transportation  network  companies  operating  in                                                                    
     their municipality.                                                                                                        
                                                                                                                                
     Add Section 9                                                                                                              
                                                                                                                                
     Page 14, Line 20 add                                                                                                       
     "This Act  takes effect immediately under  AS 01.10.070                                                                    
     (c)."                                                                                                                      
                                                                                                                                
     Conforms this  bill to the companion  bill which passed                                                                    
     in  the other  body  giving it  an immediate  effective                                                                    
     date.                                                                                                                      
                                                                                                                                
MS.  STIDOLPH, in  response to  Representative Stutes,  clarified                                                               
that local  municipalities would  need an  ordinance to  opt out,                                                               
but  local authorities,  such as  a borough  assembly, would  not                                                               
have that authority; it would be left to a vote of the people.                                                                  
                                                                                                                                
3:37:04 PM                                                                                                                    
                                                                                                                                
CHAIR  KITO removed  his objection  to  the motion  to adopt  the                                                               
proposed CS for HB 132,  Version 30-LS0522\T, Wallace, 5/8/17, as                                                               
a working document.  There  being no further objection, Version T                                                               
was before the committee.                                                                                                       
                                                                                                                                
3:37:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON opined that  HB 132 is "getting better."                                                               
He said  he would not object  to moving HB 132  out of committee;                                                               
however, he  thinks it  could be  improved.   He stated  that his                                                               
feelings about the proposed legislation  are "colored by the fact                                                               
that the principle  company that has been so  successful has just                                                               
been really unimpressive," in terms  of its public relations.  He                                                               
continued, "Its stock is really low  with me, ... while it's high                                                               
on the market."  He said  he still finds [TNC drivers] are quasi-                                                               
employees  under case  law and  some components  of the  Internal                                                               
Revenue Service's  (IRS's) definition of  what it means to  be an                                                               
independent  contractor.   He indicated  that passengers  make up                                                               
the majority  of those who  would be impacted  by HB 132,  and he                                                               
opined that they  "will have their lives  improved."  Conversely,                                                               
he said in terms of drivers'  experiences, there is "a little bit                                                               
of a  race to  the bottom."   He added that  a person  could say,                                                               
"Well, then they  don't have to do  it," but he said  that is not                                                               
how  he operates.   He  acknowledged  that there  is much  public                                                               
enthusiasm about  HB 132, but  he reiterated that the  bill could                                                               
be improved.  He ventured, "Maybe  Uber or Lyft would say, 'We're                                                               
not going to  operate there,' but I think other  TNCs would."  He                                                               
said  he  is  amazed  at  how  much  [HB  132]  accommodates  the                                                               
industry; however,  he said  he appreciates  that the  work draft                                                               
"goes a little closer to the middle."                                                                                           
                                                                                                                                
3:39:51 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WOOL  expressed appreciation  for the  comments by                                                               
Representative  Josephson.    He  said he  thinks  HB  132  would                                                               
provide a more convenient way  for people to transport themselves                                                               
throughout Alaska.   He said  he thinks  drivers will be  able to                                                               
work "on  and off" to "pick  up a few  dollars" to pay for  a new                                                               
car,  for example,  and they  will have  the flexibility  to work                                                               
three or four  hours and then go  home and take care  of a child,                                                               
for example.  A taxi driver,  by contrast, may work a 12-hour day                                                               
for 5 to  6 days a week.   He said whether it  is worth someone's                                                               
time [to become a TNC operator] remains to be determined.                                                                       
                                                                                                                                
REPRESENTATIVE  WOOL  said he  thinks  the  opt-out provision  is                                                               
helpful for a community that  doesn't want to allow TNCs, because                                                               
the governing body could put the  matter to a vote of the people.                                                               
He said  he cannot speak  to "the  moral standing of  the largest                                                               
TNC."   He said  hopefully "things will  improve or  they'll lose                                                               
market share."  He concluded  that there are other companies that                                                               
are doing better,  are popular, and wish to come  to Alaska, "so,                                                               
hopefully we'll have choices."                                                                                                  
                                                                                                                                
3:41:50 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE STUTES moved to report  CS for HB 132, Version 30-                                                               
LS0522\T,  Wallace,  5/8/17,  out of  committee  with  individual                                                               
recommendations and  the accompanying fiscal notes.   There being                                                               
no objection, CSHB  132(L&C) was reported out of  the House Labor                                                               
and Commerce Standing Committee.                                                                                                
                                                                                                                                
3:42:22 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Labor and  Commerce Standing Committee  meeting was  adjourned at                                                               
3:42 p.m.                                                                                                                       

Document Name Date/Time Subjects
HB132 Draft Proposed Blank CS ver T 5.9.17.pdf HL&C 5/12/2017 3:15:00 PM
HB 132
CSHB132 (LAC) ver T Work Draft Explanation of Changes 5.9.17.pdf HL&C 5/12/2017 3:15:00 PM
HB 132
CSHB132 ver T Work Draft Sectional Analysis 5.12.17.pdf HL&C 5/12/2017 3:15:00 PM
HB 132