Legislature(1999 - 2000)
04/30/1999 03:28 PM House L&C
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
April 30, 1999
3:28 p.m.
MEMBERS PRESENT
Representative Norman Rokeberg, Chairman
Representative Andrew Halcro, Vice Chairman
Representative John Harris
Representative Sharon Cissna
MEMBERS ABSENT
Representative Jerry Sanders
Representative Lisa Murkowski
Representative Tom Brice
COMMITTEE CALENDAR
HOUSE BILL NO. 183
"An Act relating to the powers and duties of the chair of the
Alaska Public Utilities Commission; relating to membership on the
Alaska Public Utilities Commission; and relating to the annual
report of the Alaska Public Utilities Commission."
- HEARD AND HELD
CS FOR SENATE BILL NO. 93(FIN)
"An Act relating to the purposes of certain businesses and
corporations; relating to the names of businesses and
organizations; relating to the registration under the Alaska
Trademark Act of marks that resemble the name of another business
or organization; and providing for an effective date."
- MOVED CSSB 93(FIN)
HOUSE BILL NO. 81
"An Act relating to the provision of electric service in the state;
and providing for an effective date."
- BILL HEARING CANCELLED
HOUSE BILL NO. 185
"An Act exempting certain small water utilities from regulation by
the Alaska Public Utilities Commission."
- BILL HEARING CANCELLED
(* First public hearing)
PREVIOUS ACTION
BILL: HB 183
SHORT TITLE: ALASKA PUBLIC UTILITIES COMMISSION
SPONSOR(S): SPECIAL COMMITTEE ON UTIL RESTRUCTURING
Jrn-Date Jrn-Page Action
4/09/99 702 (H) URS, L&C
4/14/99 (H) URS AT 8:00 AM BUTROVICH ROOM 205
4/14/99 (H) SCHEDULED BUT NOT HEARD
4/16/99 (H) URS AT 2:00 PM CAPITOL 120
4/16/99 (H) MOVED CSHB 183(URS) OUT OF COMMITTEE
4/16/99 (H) MINUTE(URS)
4/20/99 880 (H) URS RPT CS(URS) NT 6DP
4/20/99 880 (H) DP: PORTER, KOTT, COWDERY, HUDSON,
4/20/99 880 (H) GREEN, ROKEBERG
4/20/99 880 (H) ZERO FISCAL NOTE (DCED)
4/20/99 880 (H) REFERRED TO L&C
4/09/99 702 (H) READ THE FIRST TIME - REFERRAL(S)
4/23/99 (H) L&C AT 3:15 PM CAPITOL 17
4/23/99 (H) HEARD AND HELD
4/23/99 (H) MINUTE(L&C)
4/26/99 (H) L&C AT 3:15 PM CAPITOL 17
4/26/99 (H) HEARD AND HELD
4/26/99 (H) MINUTE(L&C)
4/28/99 (H) L&C AT 3:15 PM CAPITOL 17
4/28/99 (H) HEARD AND HELD
4/28/99 (H) MINUTE(L&C)
4/30/99 (H) L&C AT 3:15 PM CAPITOL 17
BILL: SB 93
SHORT TITLE: NAMES OF ORGANIZATIONS & BUSINESSES
SPONSOR(S): LABOR & COMMERCE
Jrn-Date Jrn-Page Action
3/04/99 408 (S) READ THE FIRST TIME - REFERRAL(S)
3/04/99 408 (S) L&C
3/25/99 (S) L&C AT 1:30 PM BELTZ 211
3/25/99 (S) MOVED CS (L&C) OUT OF COMMITTEE
3/25/99 (S) MINUTE(L&C)
3/26/99 700 (S) L&C RPT CS 4DP 1NR NEW TITLE
3/26/99 700 (S) DP: MACKIE, TIM KELLY, LEMAN, DONLEY;
3/26/99 700 (S) NR: HOFFMAN
3/26/99 700 (S) FISCAL NOTE (DCED)
3/26/99 700 (S) FIN REFERRAL ADDED
4/09/99 (S) FIN AT 8:00 AM SENATE FINANCE 532
4/09/99 (S) HEARD AND HELD
4/09/99 (S) MINUTE(FIN)
4/19/99 (S) FIN AT 9:00 AM SENATE FINANCE 532
4/19/99 (S) MOVED CS (FIN) OUT OF COMMITTEE
4/19/99 (S) MINUTE(FIN)
4/21/99 (S) RLS AT 11:30 AM FAHRENKAMP 203
4/21/99 (S) MINUTE(RLS)
4/21/99 982 (S) FIN RPT CS 2DP 5NR NEW TITLE
4/21/99 983 (S) DP: TORGERSON, LEMAN; NR: PARNELL,
4/21/99 983 (S) PETE KELLY, ADAMS, WILKEN, GREEN
4/21/99 983 (S) FISCAL NOTE (DCED)
4/26/99 1087 (S) RULES TO CALENDAR AND 1 OR 4/26/99
4/26/99 1115 (S) READ THE SECOND TIME
4/26/99 1116 (S) FIN CS ADOPTED UNAN CONSENT
4/26/99 1116 (S) ADVANCED TO THIRD READING UNAN
4/26/99 1116 (S) CONSENT
4/26/99 1116 (S) READ THE THIRD TIME CSSB 93(FIN)
4/26/99 1116 (S) PASSED Y18 N- E2
4/26/99 1116 (S) EFFECTIVE DATE(S) SAME AS PASSAGE
4/26/99 1120 (S) TRANSMITTED TO (H)
4/27/99 1019 (H) READ THE FIRST TIME - REFERRAL(S)
4/27/99 1020 (H) L&C, FIN
4/30/99 (H) L&C AT 3:15 PM CAPITOL 17
WITNESS REGISTER
DOUGLAS NEELEY
Copper Basin Sanitation Service Company
P.O. Box 88
Glennallen, Alaska 99588-0088
Telephone: (907) 822-3600
POSITION STATEMENT: Interested in refuse regulation issue, which
HB 183 does not speak to.
JANET SEITZ, Legislative Assistant
to Representative Rokeberg
Alaska State Legislature
Capitol Building, Room 24
Juneau, Alaska 99801
Telephone: (907) 465-4968
POSITION STATEMENT: Provided information during HB 183 hearing as
aide to the House Labor and Commerce Standing Committee.
RON ZOBEL, Assistant Attorney General
Fair Business Practices Section
Civil Division (Anchorage)
Department of Law
1031 West Fourth Avenue, Suite 200
Anchorage, Alaska 99501-1994
Telephone: (907) 269-5100
POSITION STATEMENT: Testified on HB 183, agreed to provide
possible amendment language.
DAVID GRAY, Legislative Assistant
to Senator Jerry Mackie
Alaska State Legislature
Capitol Building, Room 427
Juneau, Alaska 99801
Telephone: (907) 465-3844
POSITION STATEMENT: Presented SB 93 as aide to the Senate Labor
and Commerce Standing Committee, the bill sponsor.
DAWN WILLIAMS, Records and Licensing Supervisor
Division of Banking, Securities and Corporations
Department of Commerce and Economic Development
P.O. Box 110807
Juneau, Alaska 99811-0907
Telephone: (907) 465-2297
POSITION STATEMENT: Testified on SB 93.
ACTION NARRATIVE
TAPE 99-50, SIDE A
Number 0001
CHAIRMAN NORMAN ROKEBERG called the House Labor and Commerce
Standing Committee meeting to order at 3:28 p.m. Members present
at the call to order were Representatives Rokeberg, Halcro, Harris
and Cissna.
HB 183 - ALASKA PUBLIC UTILITIES COMMISSION
Number 0090
CHAIRMAN ROKEBERG announced the committee's first order of business
is HB 183, "An Act relating to the powers and duties of the chair
of the Alaska Public Utilities Commission; relating to membership
on the Alaska Public Utilities Commission; and relating to the
annual report of the Alaska Public Utilities Commission." The
chairman indicated he had intended to postpone the hearing on HB
183 because two committee members who wished to propose amendments
are absent. The chairman noted, however, he wishes to take the
testimony of the two witnesses who have signed up, and hold the
legislation over after that testimony. He informed the committee
no amendments or action would be taken up on HB 183 at this
hearing. Chairman Rokeberg requested the testimony of Douglas
Neeley in Glennallen.
Number 0122
DOUGLAS NEELEY, Copper Basin Sanitation Service Company, responded
via teleconference from Glennallen. Mr. Neeley commented he had
intended to listen to the discussion and the amendments. He
questioned if the committee planned to take any action at all on
this legislation today.
CHAIRMAN ROKEBERG responded in the negative. He noted the two
proposed amendments are from absent members. Representative
Murkowski had intended to offer a "clean-up" amendment recommended
by the Department of Law. Representative Brice had intended to
offer an amendment to remove the qualifications of office regarding
political affiliations [for commissioners].
REPRESENTATIVE HARRIS informed the chairman that Mr. Neeley's
concern is in relation to garbage deregulation, and the chairman
might wish to explain that this legislation is not the right
vehicle for that. He confirmed for the chairman that Mr. Neeley's
business is Copper Basin Sanitation Service Company.
CHAIRMAN ROKEBERG indicated the committee had received Copper Basin
Sanitation's letter and thanked Mr. Neeley. The chairman pointed
out that HB 183 does not speak to the refuse regulation issue. He
informed Mr. Neeley that the committee is in receipt of the latest
version of SB 133, which had originally taken up the refuse issue
by deleting it from the APUC [Alaska Public Utilities Commission].
However, as the chairman understands it, the latest version of SB
133 excludes those provisions and maintains the status quo. He
asked Ms. Seitz if that is correct.
Number 0272
JANET SEITZ, Legislative Assistant to Representative Rokeberg,
Alaska State Legislature, came forward as the aide to the House
Labor and Commerce Standing Committee. Ms. Seitz noted the latest
version of SB 133 the committee is in receipt of, Version K, does
contain reference to garbage-related services in the definition of
a public utility. She stated, "It does describe furnishing,
collection and disposal services of garbage, refuse, trash or other
waste material to the public for compensation; that is part of the
definition of a public utility contained in the latest draft of SB
133 that we have."
CHAIRMAN ROKEBERG confirmed, therefore, the commission would retain
its regulatory control. The chairman recommended Mr. Neeley obtain
a copy of SB 133, Version K, adopted that day by the Senate Finance
Standing Committee. Chairman Rokeberg believes SB 133 will
ultimately be the vehicle utilized. The chairman indicated the
committee is using HB 183 for coordination and to develop some
potential amendments; HB 183 may also be held as a possible back-up
bill. He questioned if Mr. Neeley had any further comments.
MR. NEELEY indicated his questions had been answered and thanked
the committee.
CHAIRMAN ROKEBERG asked Mr. Zobel in Anchorage if he had comments
or if he was present to listen and answer questions.
Number 0427
RON ZOBEL, Assistant Attorney General, Fair Business Practices
Section, Civil Division (Anchorage), Department of Law, testified
next via teleconference from Anchorage. He is one of the two
assistant attorney generals assigned to the APUC. Mr. Zobel
indicated he has a comment he had intended to make at the April 28
hearing that he thinks is now more important in retrospect. Mr.
Zobel said, "One of the things you've done by this bill is put in
Section 10 of the committee substitute [Version I] which amends
[AS] 42.05.171, provisions about an arbitrator." He indicated he
thinks the intention was to allow case hearing and proposed
decision making to be delegated to an arbitrator. Mr. Zobel said
his comment would also apply to the delegation to hearing officers.
[Section 10 of HB 183, Version I, reads:
* Sec. 10. AS 42.05.171 is amended to read:
Sec. 42.05.171. Formal hearings. A formal hearing
that the commission has power to hold may be held by or
before three or more commissioners, a hearing officer, or
an administrative law judge designated for the purpose by
the commission. In appropriate cases, a formal hearing
may be held before an arbitrator designated for the
purpose by the commission. The testimony and evidence in
a formal hearing may be taken by the commissioners, by
the hearing officer, [OR] by the administrative law
judge, or by the arbitrator to whom the hearing has been
assigned. A commissioner who has not heard or read the
testimony, including the argument, may not participate in
making a decision of the commission. In determining the
place of a hearing, the commission shall give preference
to holding the hearing at a place most convenient for
those interested in the subject of the hearing.]
MR. ZOBEL directed the committee's attention to the language in
existing law in Section 10 of Version I beginning on line 29, page
4, "A commissioner who has not heard or read the testimony,
including the argument, may not participate in making a decision of
the commission." That provision has been interpreted by some
commissioners to - and probably does - prevent the commission from
delegating the hearing of a case and the making of a proposed
decision to a hearing officer or an arbitrator. Mr. Zobel
indicated this procedure, however, is allowed under similar
provisions in AS 44.62.500 of the Administrative Procedure Act,
regarding decision in a contested case. He noted, however, the
Administrative Procedure Act does not apply to the APUC. [AS
42.62.500 read:
Sec. 44.62.500. Decision in a contested case. (a) If a
contested case is heard before an agency
(1) the hearing officer who presided at the hearing
shall be present during the consideration of the case
and, if requested, shall assist and advise the agency;
and
(2) a member of the agency who has not heard the
evidence may not vote on the decision.
(b) If a contested case is heard by a hearing
officer alone, the hearing officer shall prepare a
proposed decision in a form that may be adopted as the
decision in the case. A copy of the proposed decision
shall be filed by the agency as a public record with the
lieutenant governor and a copy of the proposed decision
shall be served by the agency on each party in the case
and the party's attorney. The agency itself may adopt the
proposed decision in its entirety, or may reduce the
proposed penalty and adopt the balance of the proposed
decision.
(c) If the proposed decision is not adopted as
provided in (b) of this section the agency may decide the
case upon the record, including the transcript, with or
without taking additional evidence, or may refer the case
to the same or another hearing officer to take additional
evidence. If the case is so assigned the hearing officer
shall prepare a proposed decision as provided in (b) of
this section upon the additional evidence and the
transcript and other papers that are part of the record
of the earlier hearing. A copy of the proposed decision
shall be furnished to each party and the party's attorney
as prescribed by (b) of this section. The agency may not
decide a case provided for in this subsection without
giving the parties the opportunity to present either oral
or written argument before the agency. If additional oral
evidence is introduced before the agency, an agency
member may not vote unless that member has heard the
additional oral evidence.]
Number 0562
MR. ZOBEL commented AS 44.62.500 has a section which allows
delegation to a hearing officer to hear the matter and to submit a
proposed decision. The agency in that instance can approve the
decision in its entirety without reading the whole transcript or
having attended the hearing. If the agency wants to modify the
decision, it has to read the record or take additional evidence.
Mr. Zobel indicated he thinks the sentence he has mentioned in the
existing APUC statute, "A commissioner who has not heard or read
the testimony, including the argument, may not participate in
making a decision of the commission.", would need to be altered
along the lines of the language in AS 42.62.500 if it is the
committee's intention to allow more efficiency by the commission
through delegation to hearing officers or arbitrators. Mr. Zobel
further indicated he might be able to provide possible language
early next week. He noted there has been previous talk at the
commission about delegating to hearing officers and that sentence
in the existing law is pointed to as inhibiting that; the
commissioner either has to be there or read the whole record, which
somewhat defeats the purpose of delegation to a hearing officer or
arbitrator. That completed Mr. Zobel's testimony.
Number 0659
CHAIRMAN ROKEBERG said he appreciated and agreed with Mr. Zobel's
comment. The chairman questioned if it might be possible for Mr.
Zobel to make a recommendation and even a draft amendment by the
committee's 3:15 p.m. meeting on Monday [May 3, 1999].
MR. ZOBEL indicated he could do so.
CHAIRMAN ROKEBERG indicated he thought an accompanying summary
explaining the situation would be very helpful, if it didn't cause
Mr. Zobel too much work. The chairman provided the committee's fax
number. Proceeding onward, the chairman questioned if the
committee is working from Version I.
MS. SEITZ confirmed the committee is working from Version I of HB
183 and has two pending amendments to this version. The committee
adopted Amendment 3 to Version I [adopted 4/28/99; labeled
1-LS0764\I.3, Cramer, 4/28/99] . Ms. Seitz confirmed that
Amendment 1 [offered and amended 4/28/99; labeled 1-LS0764\I.1,
Cramer, 4/28/99] and Amendment 2 [offered 4/28/99; labeled
1-LS0764\I.2, Cramer, 4/28/99] are both still before the committee.
Number 0741
REPRESENTATIVE HALCRO indicated the committee also still has
Amendment 8 to Version H offered at the Monday, April 26 hearing
[stated as "Friday"]. Representative Halcro noted the committee
had been waiting on the determination of constitutionality and now
has the opinion.
CHAIRMAN ROKEBERG asked Ms. Seitz to organize materials with the
committee in preparation for the Monday hearing [May 3]. He noted
there is Amendment 1 and commented Representative Murkowski has an
amendment to Amendment 1 which can be handled then.
MS. SEITZ commented Amendment 1 is marked I.1. She indicated
Amendment 2, marked I.2, was held by the chairman on April 28. It
is the amendment regarding rate charges. Ms. Seitz pointed out
there is also the corrected Amendment 8 [to Version H] from
Representative Halcro, which was being held for the legal opinion.
She confirmed this amendment concerns the appointment of the chair
and copies of the legal opinion are being distributed to the
committee. Additionally there is a new amendment, from
Representative Brice, relating to the political qualifications.
Number 0852
CHAIRMAN ROKEBERG stated the committee should be prepared to bring
these items forward. The chairman indicated he would like Ms.
Seitz to discuss the legal opinion on Amendment 8 with
Representative Halcro and Walt Wilcox [aide to the House Special
Committee on Utility Restructuring] to ensure this can be
addressed. Chairman Rokeberg requested Mr. Zobel's comments on
Amendment 1. The chairman confirmed Mr. Zobel and Representative
Murkowski had had a conversation regarding deletion of the
amendment language, "complexity of issues, or another reason", on
line 19 of the original written amendment. [Amendment 1, labeled
1-LS0764\I.1, Cramer, 4/28/99, as amended by the committee on
4/28/99, read:
Page 1, line 5, following ";":
Insert "relating to timely action by the Alaska
Public Utilities Commission;"
Page 3, line 26:
Delete "a new subsection"
Insert "new subsections"
Page 3, lines 28 - 30:
Delete ", the chair of the commission shall promptly
fix a date for hearing when a hearing is appropriate.
The hearing shall be without undue delay. The"
Insert "for which a hearing is clearly warranted,
the chair of the commission shall assign a priority
rating to the issue and promptly fix a date for hearing.
The hearing shall be expedited in accordance with the
priority rating. Regardless of the priority rating, a"
Page 4, following line 2:
Insert a new subsection to read:
"(c) Unless to do so would violate the due
process rights of a party, the commission shall
ensure that its dockets are closed in a timely
fashion and not delayed due to inaction, complexity
of issues, or another reason. Failure of a
commission member to comply with this subsection
constitutes grounds for removal from the commission
under AS 42.05.035. The chair of the commission
may dismiss a commission employee for failure to
comply with this subsection."]
Number 0955
MR. ZOBEL agreed with the view Representative Murkowski had
expressed at the previous hearing: this language would not allow
for any reason. The phrase "another reason" is particularly
troublesome, it is too broad; there is no reason for delay at all.
Mr. Zobel additionally commented he thinks the phrase, "Unless to
do so would violate the due process rights of a party,", is rather
superfluous. It is implied that the commission cannot violate due
process rights of a party. However, he said he has not tried to
rewrite this particular section. Mr. Zobel indicated one reason is
that these issues are in Jim Baldwin's [Assistant Attorney General,
Governmental Affairs Section, Civil Division (Juneau), Department
of Law] area of expertise.
Number 1024
CHAIRMAN ROKEBERG indicated his wish had been to take Mr. Zobel's
testimony for the committee's information so less time would have
to be spent at the May 3 hearing. The chairman repeated that
Representative Murkowski would be offering an amendment to the
amendment, and looking at the balance of that statement. He
confirmed no one else wished to testify on HB 183 and announced HB
183 would be held over for further action on Monday [May 3].
CSSB 93(FIN) - NAMES OF ORGANIZATIONS & BUSINESSES
Number 1115
CHAIRMAN ROKEBERG announced the committee's next order of business
is CSSB 93(FIN), "An Act relating to the purposes of certain
businesses and corporations; relating to the names of businesses
and organizations; relating to the registration under the Alaska
Trademark Act of marks that resemble the name of another business
or organization; and providing for an effective date."
Number 1130
DAVID GRAY, Legislative Assistant to Senator Jerry Mackie, Alaska
State Legislature, came forward to present SB 93 as aide to the
Senate Labor and Commerce Standing Committee, the bill sponsor.
Senate Bill 93 was introduced in response to a request from the
Department of Commerce and Economic Development (DCED) to attempt
to clear up a real confusion in the state's responsibility for
registry or acknowledging names of the various corporations and
private businesses throughout the state. The state recognizes
names of different corporations and private entities in three ways.
In Alaska Statutes 10.06, 10.20, 10.35, 32.11, the standard is that
the name may not be the same or deceptively similar to the name of
another corporation or public entity. In Alaska Statute 10.25, the
guideline is that the name shall be distinct from the name of
another corporation. In Alaska Statutes 10.50 and 32.05, the
guideline is that the name is distinguishable on the records of the
department. These three different standards distributed through
the state's statutes are cause for a tremendous amount of confusion
and draws the DCED into an enormous amount of controversy.
MR. GRAY stated SB 93 is an attempt to establish one standard,
"distinguishable on the record," which is used by most states and
is recommended by the "Uniform Code Commission." He indicated a
representative of the department is also present to answer
technical questions. Mr. Gray explained to the newer members of
the legislature that, from his experience, without something like
this they would indeed receive some complaint from an irate
constituent on this subject. He described the complaint could be
that someone else was, in the constituent's view, taking the
constituent's [business] name, or it could be that the constituent
filed a name and found out someone else has that name. Mr. Gray
indicated there is not much which can be done in these situations;
in his experience it has been a very difficult issue to resolve to
anyone satisfactorily.
Number 1292
CHAIRMAN ROKEBERG asked if the committee had any questions for Mr.
Gray. The chairman noted the bill's length seems to result from
repeating the same thing in different sections of the statute,
questioning if they were being relatively repetitive.
MR. GRAY answered that is correct. There are three different
standards distributed through a great deal of statute which are
being reduced to one standard, "distinguishable on the record." He
indicated he wished the department to describe why it wishes to
have this standard, why it should be in this place, and how this
might resolve the current confusion.
CHAIRMAN ROKEBERG questioned if there has been any testimony from
businesses providing an example this could correct.
MR. GRAY replied he does not have any direct testimony from
businesses on record. However, there has certainly been no
objection.
CHAIRMAN ROKEBERG indicated he is thinking of the Alaska State
Chamber of Commerce, the National Federation of Independent
Business (NFIB), et cetera.
Number 1373
REPRESENTATIVE HALCRO pointed to the Senate Finance Standing
Committee minutes of April 9, 1999, in the bill packet which
mention the case of "Wild Iris" and the "Wild Iris Cafe" provided
by Dawn Williams of the DCED. Representative Halcro quoted, "'She
said the department felt they were different but "Wild Iris" did
not. Therefore, a lawsuit was filed and the State was brought into
the suit.'"
MR. GRAY indicated the Senate Finance changes were mainly technical
amendments. The language in SB 93 regarding the adoption of
regulations to "interpret or implement" a subsection, et cetera,
was changed to "implement". Mr. Gray indicated this change was
made in about 15 places and had been the wish of one of the Senate
Finance co-chairs. Mr. Gray noted there had also been one small
technical amendment requested by the department which had made
eminent sense.
CHAIRMAN ROKEBERG indicated the detail-oriented nature of the House
Labor and Commerce Standing Committee.
Number 1485
DAWN WILLIAMS, Records and Licensing Supervisor, Division of
Banking, Securities and Corporations, Department of Commerce and
Economic Development, came forward. Ms. Williams stated she is the
corporations supervisor for the DCED and asked for the committee's
questions.
CHAIRMAN ROKEBERG requested she explain the legislation.
MS. WILLIAMS replied the department has corporations, limited
liability companies (LLCs), limited partnerships, limited liability
partnerships (LLPs), nonprofit corporations, religious
corporations, plus a few more. Basically, there are three
standards for deciding who can have what name. Ms. Williams
indicated the current standards for the limited liability companies
are unfair. The department is attempting to require all entities
to use one standard to determine whether or not their name is
available. Additionally, this legislation would allow more
entities to file with the state, either as a corporation, limited
liability company, or simply as a business name.
Number 1539
REPRESENTATIVE HALCRO noted it was mentioned in the Senate
testimony that 25 other states have adopted this same language. He
questioned if these states had solicited comments from chambers of
commerce, et cetera. Representative Halcro questioned if this is
a problem that exists and if that is the impetus for the
legislation in other states.
MS. WILLIAMS said she really does not know the answer. She would
think that most states have adopted the wording through the Revised
Model Business Corporation Act (RMBCA) done by the American Bar
Association ["national bar association"]. Ms. Williams noted that
language is "the (indisc.) must be distinguishable on the record."
CHAIRMAN ROKEBERG requested Ms. Williams repeat the example of the
Iris case and possibly a few others.
MS. WILLIAMS answered that "The Wild Iris" was on file with the
Division of Banking, Securities and Corporations as a registered
business name. The division received a new registration for "Wild
Iris Cafe." The division felt the names were different; it was not
confused by the two names at that time. The Wild Iris decided the
department was wrong and basically brought suit against the Wild
Iris Cafe and against the state. Through the department, with the
assistant AG [attorney general], it was decided that possibly The
Wild Iris was correct, maybe there is confusion, because the two
entities are in the same type of business. Ms. Williams noted she
thought this is the restaurant business; she thinks one entity is
in Anchorage and the other in Fairbanks. She commented she had
been confused about that at the Senate Finance hearing.
CHAIRMAN ROKEBERG questioned if she was no longer confused.
Number 1657
MS. WILLIAMS replied she believes so. The department decided that
the names were possibly confusing to the public. Unfortunately for
the state, business entity conflicts should not be decided by the
state - they should be decided by each individual entity. A new
corporation first of all needs to make sure there is no other
entity with the same name the corporation wishes to use.
CHAIRMAN ROKEBERG asked how one does this.
MS. WILLIAMS answered one looks in trade magazines, newspapers,
business licensing, and the Division of Banking, Securities and
Corporations of the DCED. She described the example of a business
obtaining a business license and then attempting to register the
business name with the division. In the example, Ms. Williams
noted she was simply speaking of a business obtaining a business
license, not a corporation, partnership, et cetera. In her
example, the division already has a corporation on file with this
same name and therefore will not file that business registration.
However, the first business is still out there doing business under
that name because it has a business license to do that. It is up
to the corporation to stop that business entity from using the
name.
CHAIRMAN ROKEBERG questioned that the corporation would have to
bring cause of action for this.
MS. WILLIAMS answered in the affirmative. She described that there
could be a business with a business license out there doing
business on its own. A corporation starts up, picking this great
name. The corporation files with the division as a corporation and
the division has no other name like that on file. Two years later
the corporation finds out this small entity has the same name and
had it first. Ms. Williams questioned which entity has rights to
the name. She said it is not up to the state to decide who has
right to the name; it is up to those entities to go to court and
determine that.
Number 1748
REPRESENTATIVE HALCRO mentioned he knew of a restaurant called
Chilly's in Anchorage on the Old Seward Highway towards Huffman
which suddenly went from "Chilly's" to "Eric's (ph)."
Representative Halcro noted the only thing he could think of was
that "Chilly's (ph)," the national chain, came in and said "'Hey,
excuse us, but you're using our name.'" He asked if the division
gets involved in that type of situation where a name is trademarked
or copyrighted.
MS. WILLIAMS replied the division cannot get involved in that. She
indicated, however, SB 93 contains a statute change regarding
trademarks within the state. Ms. Williams explained no
duplications are allowed with federally-registered trademarks but
she indicated state trademarks extend only to the state they are
registered in. She noted someone can register a trademark in
Alaska that may already be registered in Washington; the division
does not do any searching or anything. Ms. Williams stated, "The
trademark statutes and the business name or corporate name
standards don't look at each other. What we're doing with the
statute change is making it so that if when somebody files
trademark, we actually at our corporate database or our registered
business name database and make sure that somebody's not stepping
on somebody's toes within our own section, so that we can stop
those problems." She noted these problems have occurred.
REPRESENTATIVE CISSNA assumed because of the onus of responsibility
on the business owner, that there must be numerous cases of
businesses with the same name in various towns, and even in the
same town. She commented her own business name is very close to
another business name; it has been true for 20 years and neither
business cares. Representative Cissna said she is assuming this
wouldn't change that ability.
Number 1861
MS. WILLIAMS answered that every business has to have a business
license; business licensing does not have name statutes. Numerous
businesses can have the same business license name. However, the
Division of Banking, Securities and Corporations, which deals with
corporations, liability companies, partnerships and registered
business names, cannot have one name on file that is the same as
another. It doesn't matter who has a name outside who has not
registered with the division - this doesn't change anything for
those people. If there is a conflict between these businesses that
are outside the division, they have to settle that themselves. It
is not the state's problem; it is not something that the state can
determine. Ms. Williams said no other state she knows of is in the
name conflict business. She commented, "They don't determine
whether this person way out here and this person way out here
shouldn't have the same name or not. It's when they come to
register with the state that they have the problem."
CHAIRMAN ROKEBERG confirmed from Ms. Williams that the business
licensing is under the Division of Occupational Licensing. He
indicated there has been some discussion about changing that. The
chairman asked if she knew the procedure regarding using a name on
a business license; he questioned if there wasn't some warning or
something on the application itself.
MS. WILLIAMS replied she is not sure about warnings. If a business
has "Inc." [incorporated] in its business name when it files its
business license, Business Licensing will send the business a small
blue card informing the business it should contact the Division of
Banking, Securities and Corporations. If a business has "Inc." in
its name, it should be a corporation. Business Licensing also
sends a blue card to inform a business that it can register its
name and that it might want to check with the Division of Banking,
Securities and Corporations to see if another business has a name
like that.
Number 1960
CHAIRMAN ROKEBERG asked how a non-corporate entity registers a name
with the division.
MS. WILLIAMS answered, under Section 10.35. She explained that a
business can file an application with the division if it has a
business license. Currently, the business can register that
business name if the business's name is not the same as or
deceptively similar to another name on file.
CHAIRMAN ROKEBERG indicated he wondered if this applied to any type
of business, mentioning sole proprietorship, partnership, LLC, LLP,
et cetera.
MS. WILLIAMS answered that only business names or d/b/a [doing
business as] names could be registered as sole proprietorship
entities. LLCs, LLPs, and all of those entities, have to file
articles of incorporation or certificates of partnership.
CHAIRMAN ROKEBERG noted, then, they would already be under the
division's jurisdiction. However, if a sole proprietorship wanted
to register a name with the Division of Banking, Securities and
Corporations, they could do so.
MS. WILLIAMS confirmed that is correct.
CHAIRMAN ROKEBERG questioned whether a common multiple partner-type
business would be required to be registered with the division.
Number 2010
MS. WILLIAMS indicated this type of business would not necessarily
be registered. She explained the only entities that must register
with the Division of Banking, Securities and Corporations are
corporations - whether nonprofit or for-profit and including
religious corporations, limited liability companies, limited
liability partnerships, limited partnerships, and cooperative
corporations.
CHAIRMAN ROKEBERG commented, then, sole proprietorships or
combinations of family businesses wouldn't necessarily be
registered [with the division].
MS. WILLIAMS indicated that is correct.
CHAIRMAN ROKEBERG confirmed, though, these businesses could
register under the business name registrations. The chairman noted
the committee had received some correspondence a year or two
previously from a gentleman in Juneau with a landscaping business.
As the chairman recalls, a disgruntled employee of this business
left and then filed the business name with the business registry,
in effect almost stealing the business. The chairman indicated
there was a large conflict because the owner of the business did
not have the business name currently registered, lacked a business
license or something. Chairman Rokeberg asked Ms. Williams if that
rang a bell with her.
MS. WILLIAMS replied it did, but not clearly. She commented, "Our
statutes -- and this is why I say we're not in the name finding
business ...." The entities have to go to court themselves to
determine who has legal right to that name. The first person who
registers a name with the division, whether corporate name or
business registration, is the one who has it. That doesn't
necessarily give the entity legal title to that name; it is up to
the courts to decide who has legal right to that name.
CHAIRMAN ROKEBERG indicated this is because the name could be
copyrighted or trademarked in another jurisdiction, or the business
might be a sole proprietorship which has had a business license for
a number years but finally decided to incorporate, and wouldn't be
on the registry, et cetera.
MS. WILLIAMS indicated the chairman is correct.
CHAIRMAN ROKEBERG noted, though, the issue here is what the courts
should use in interpreting the criteria or standard for the name.
He questioned which standard is being used for the registry
(indisc.).
Number 2123
MS. WILLIAMS answered the standard most used currently is "the same
as or deceptively similar." This has been in use for years, but
the "distinguishable" standard is the newest standard. It is the
one most states are currently using; at least 25 states have
adopted it in recent years.
CHAIRMAN ROKEBERG asked, "Was it using 'deceptively similar'?"
MS. WILLIAMS agreed.
CHAIRMAN ROKEBERG questioned that the division believes by changing
the standard, more businesses with deceptively similar names that
are distinguishable on the record will be able to register,
resulting in the $30,000 and progressively increasing fiscal note.
He confirmed Ms. Williams agreed. The chairman asked if the
division believes it will actually increase its revenue.
MS. WILLIAMS answered that she personally sends out several letters
a month informing businesses their names are deceptively similar to
another name on file and therefore cannot be registered. The
business can choose another name or does not even have to register
it. With the "distinguishable" standard, the business will be able
to register that name, resulting in more revenue [for the state].
Ms. Williams noted it is not a great deal of revenue, but it is a
bit more. In response to the chairman's question, Ms. Williams
informed the committee the fee to register a business name for five
years is $25.
CHAIRMAN ROKEBERG indicated in the landscaping case the name may
have been registered but not renewed after five years, and thus
someone else could have filed it.
MS. WILLIAMS agreed.
Number 2200
CHAIRMAN ROKEBERG questioned if there is anything in statute that
the division should warn (indisc.) business that there is another
business with a similar name, if an entity had what would formerly
be considered a deceptively similar name but would now be allowed
under "distinguishable on the record."
MS. WILLIAMS answered there is nothing currently in statute.
However, the division does inform businesses of other similar names
when businesses inquire about registering their name.
CHAIRMAN ROKEBERG asked if there is any regulatory or statutory
requirement for the division to do this.
MS. WILLIAMS replied not at this time. If the legislation passes,
the division is planning adopt a policy which would include that.
It would be similar to Utah's current policy.
CHAIRMAN ROKEBERG questioned the length in pages in Utah's policy.
MS. WILLIAMS answered that Utah's is approximately two to three
pages. It encompasses a great deal, explaining what names would be
available compared to names on file, et cetera.
CHAIRMAN ROKEBERG asked Mr. Gray if he thought the bill sponsor
would mind if the committee amended the legislation slightly to
tell the division to do this.
MR. GRAY replied whatever works for the division and is good
government.
MS. WILLIAMS indicated the division would have no objections.
CHAIRMAN ROKEBERG noted the division's testimony is that it is
doing this now but it does not have an obligation to do so. It
seems to him the division might have an obligation - that is why it
is doing it. He mentioned providing good service.
Number 2279
MS. WILLIAMS thinks the division probably feels it should and
therefore does so in most cases. The division would not mind
having that in statute. In response to the chairman's comment
about not wanting to add two or three pages, Ms. Williams indicated
she thinks a statement could accomplish this purpose.
CHAIRMAN ROKEBERG interjected they could put something in to the
effect of implementing regulations to provide for informing the
public of similar names so the public is aware there are other
names out there which could be used, to avoid any conflict. The
chairman asked if that would be helpful for the division.
MS. WILLIAMS replied she doesn't know if it would be helpful. She
thinks it would be helpful to the public and the division is there
to help the public. The division is attempting to get as many
corporations, entities, et cetera, to file with the state so that
these entities can continue doing business.
2328
CHAIRMAN ROKEBERG called an at-ease at 4:10 p.m. The committee
came back to order at 4:13 p.m. [TAPE CHANGED MANUALLY DURING THE
AT-EASE]
TAPE 99-50, SIDE B
Number 0001
CHAIRMAN ROKEBERG commented he would like to get some more
information regarding the trademarking (indisc.) in order to carry
the legislation on the floor, unless it is assigned to
Representative Halcro. The chairman confirmed there were no
further witnesses on SB 93 and closed the public hearing.
Number 0035
REPRESENTATIVE HALCRO made a motion to move CSSB 93(FIN) out of
committee with the accompanying positive fiscal note and individual
recommendations. There being no objection, CSSB 93(FIN) moved out
of the House Labor and Commerce Standing Committee.
ADJOURNMENT
Number 0055
CHAIRMAN ROKEBERG adjourned the House Labor and Commerce Standing
Committee meeting at 4:14 p.m.
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