Legislature(2021 - 2022)BARNES 124
04/05/2021 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB30 | |
| HB149 | |
| HB110 | |
| Regulatory Commission of Alaska | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 149 | TELECONFERENCED | |
| *+ | HB 110 | TELECONFERENCED | |
| *+ | HB 146 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 30 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
April 5, 2021
4:04 p.m.
MEMBERS PRESENT
Representative Zack Fields, Co-Chair
Representative Ivy Spohnholz, Co-Chair
Representative Calvin Schrage
Representative Liz Snyder
Representative James Kaufman
Representative Ken McCarty
MEMBERS ABSENT
Representative David Nelson
COMMITTEE CALENDAR
HOUSE BILL NO. 30
"An Act relating to notice of workers' compensation death
benefits; relating to the payment of workers' compensation
benefits in the case of permanent partial impairment; relating
to the payment of workers' compensation death benefits; and
providing for an effective date."
- MOVED HB 30 OUT OF COMMITTEE
HOUSE BILL NO. 149
"An Act relating to allowing certain child day care providers to
organize for the purpose of collective bargaining."
- HEARD & HELD
HOUSE BILL NO. 110
"An Act raising the minimum age to purchase, sell, exchange, or
possess tobacco, a product containing nicotine, or an electronic
smoking product; relating to transporting tobacco, a product
containing nicotine, or an electronic smoking product; relating
to the taxation of electronic smoking products; and providing
for an effective date."
- HEARD & HELD
CONFIRMATION HEARING(S):
State Board of Registration For Architects, Engineers & Land
Surveyors
Jake Maxwell - Anchorage
Arpad "Bruce" Magyar - Anchorage
Catherine Fritz- Juneau
- CONFIRMATION(S) ADVANCED
State Physical Therapy & Occupational Therapy Board
Nathan Missler - Anchorage
- CONFIRMATION(S) ADVANCED
Board of Dental Examiners
Christina Hansen - Fairbanks
Bradley Heaston - Anchorage
Gregory Johnson - Fairbanks
- CONFIRMATION(S) ADVANCED
Board Of Examiners In Optometry
Pamela Steffes - Sitka
Michael Mavencamp - Fairbanks
- CONFIRMATION(S) ADVANCED
Board of Marital & Family Therapy
Richard Clampitt - Palmer
Joy Collins - Anchorage
Kayla Green - Eagle River
- CONFIRMATION(S) ADVANCED
Board of Professional Counselors
Sammie O'Neal - Eagle River
Eleanor Vinson - Juneau
- CONFIRMATION(S) ADVANCED
Board of Psychologist & Psychological Associate Examiners
Bernard Gatewood - Fairbanks
Bradley McConnell - Anchorage
Sherri Scott - Anchorage
- CONFIRMATION(S) ADVANCED
Board of Social Work Examiners
Brandon Ercanbrack - Kotzebue
- CONFIRMATION(S) ADVANCED
Regulatory Commission of Alaska
Robert Pickett - Palmer
Keith Kurber - Fairbanks
- CONFIRMATION(S) ADVANCED
PREVIOUS COMMITTEE ACTION
BILL: HB 30
SHORT TITLE: WORKERS' COMP: DEATH; PERM PARTIAL IMPAIR
SPONSOR(s): REPRESENTATIVE(s) JOSEPHSON
02/18/21 (H) PREFILE RELEASED 1/8/21
02/18/21 (H) READ THE FIRST TIME - REFERRALS
02/18/21 (H) L&C, FIN
03/03/21 (H) L&C AT 5:45 PM BARNES 124
03/03/21 (H) Heard & Held
03/03/21 (H) MINUTE(L&C)
04/05/21 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 149
SHORT TITLE: CHILD CARE PROVIDER COLLECTIVE BARGAINING
SPONSOR(s): REPRESENTATIVE(s) FIELDS
03/24/21 (H) READ THE FIRST TIME - REFERRALS
03/24/21 (H) L&C, STA
04/02/21 (H) L&C AT 8:00 AM GRUENBERG 120
04/02/21 (H) <Bill Hearing Canceled>
04/05/21 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 110
SHORT TITLE: AGE FOR NICOTINE/E-CIG; TAX E-CIG.
SPONSOR(s): REPRESENTATIVE(s) HANNAN
02/24/21 (H) READ THE FIRST TIME - REFERRALS
02/24/21 (H) CRA, JUD
03/17/21 (H) CRA & JUD REFERRALS REMOVED
03/17/21 (H) L&C & FIN REFERRALS ADDED
03/17/21 (H) BILL REPRINTED
04/05/21 (H) L&C AT 3:15 PM BARNES 124
WITNESS REGISTER
CHARLES COLLINS, Director
Division of Workers' Compensation
Department of Labor and Workforce Development
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
30.
KIMBERLY ROSENBERGER
Service Employees International Union (SEIU)
Sacramento, California
POSITION STATEMENT: Gave a presentation on HB 149.
TRISTAN WALSH, Staff
Representative Fields
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented the sectional analysis on HB 149
on behalf of Representative Fields, prime sponsor.
DANIEL WAYNE, Attorney
Legislative Legal Counsel
Legislative Legal and Research Services
Legislative Affairs Agency (LAA)
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
149.
REPRESENTATIVE SARA HANNAN
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 110 as prime sponsor.
EMILY NENON, Alaska Government Relations Director
American Cancer Society Cancer Action Network
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 110.
ACTION NARRATIVE
4:04:08 PM
CO-CHAIR IVY SPOHNHOLZ called the House Labor and Commerce
Standing Committee meeting to order at 4:04 p.m.
Representatives Kaufman, Schrage, McCarty, Snyder, and Spohnholz
were present at the call to order. Representative Fields
arrived as the meeting was in progress.
HB 30-WORKERS' COMP: DEATH; PERM PARTIAL IMPAIR
4:05:25 PM
CO-CHAIR SPOHNHOLZ announced that the first order of business
would be HOUSE BILL NO. 30, "An Act relating to notice of
workers' compensation death benefits; relating to the payment of
workers' compensation benefits in the case of permanent partial
impairment; relating to the payment of workers' compensation
death benefits; and providing for an effective date."
4:05:57 PM
CHARLES COLLINS, Director, Division of Workers' Compensation,
Department of Labor and Workforce Development (DLWD), started by
congratulating the board for being able to hold the cost of
premiums down, and reminded the committee that 2021 will be the
eighth year in a row that has seen a reduction in premiums to
employers. He added that that statistic comes with a caveat
because some things in workers' compensation haven't been
adjusted for many years. He stated that workers' compensation
is the only path that an injured worker has to compensation and
repairment after a workplace injury. Since 1959, when the
[workers' compensation] act was initially implemented, there
have been a number of updates, with the last major update
occurring in 2005.
MR. COLLINS shared that in Alaska, an employer has three days to
inform the Division of Workers' Compensation of an injury that
has occurred on the job. Most of the time, he continued, the
division gets a report of injury directly from the employer but
occasionally a medical provider supplies the report. If the
process goes smoothly, the injured employee will get
rehabilitated and return to the same job. He explained that
"90-plus percent" of injuries follow that procedure. He said
that occasionally, an employer wants to follow a different path
to rehabilitation than the employee, which is the type of case
that is brought before the board, but he shared that this
situation is rare, consisting of "six or seven hundred a year"
compared to 17,000 claims. He noted that there is a team of
lawyers and employee representatives that support this process.
He said that under Alaska workers' compensation law, the
employee is only required to pay for the first $300
consultation. If the employee prevails in the case, the legal
counsel gets paid through the [Workers' Compensation] Act and by
the employer, and the employee does not have to take on the
burden of that cost.
4:10:37 PM
CO-CHAIR SPOHNHOLZ invited questions from the committee.
4:10:56 PM
CO-CHAIR SPOHNHOLZ opened public testimony on HB 30. After
ascertaining that there was no one who wished to testify, she
closed public testimony.
4:11:13 PM
REPRESENTATIVE KAUFMAN directed attention to Section 2 of the
Sectional Analysis, which read as follows [original punctuation
provided]:
Section 2: Increases the base amount in AS
23.30.190(a), used to calculated [sic] the
compensation for permanent partial impairment, from
$177,000 (2000 amount) to $273,000 to account for
inflation and bring Alaska's compensation rate up to
the national average.
REPRESENTATIVE KAUFMAN asked if Alaska was at the national
average in the year 2000.
MR. COLLINS responded that in 2000, Alaska's baseline amount of
$177,000 was at the median rather than the average. In 2000,
the baseline was changed from $135,000 to $177,000 in an effort
to bring Alaska closer to the national standards. He explained
that due to inflation, Alaska now needs to increase that number
again to align itself more closely to the national standards, as
Representative Josephson proposed in HB 30.
REPRESENTATIVE KAUFMAN commented that he finds this issue
complicated and that there is a lot of information to look
through.
MR. COLLINS replied that it takes a doctor's rating to receive a
whole body impairment percentage. The baseline of $177,000 is
used as a starting point to calculate compensation. He
explained that some states, such as Washington, break the
compensation out by injured body part instead of considering the
whole body. The doctors determine the percentage using the
American Medical Association (AMA) guide and then determine the
compensation amount starting from the $177,000 baseline, which
he reiterated has not been updated in 21 years.
4:15:22 PM
CO-CHAIR SPOHNHOLZ invited questions from the committee.
4:15:45 PM
CO-CHAIR FIELDS moved to report HB 30 out of committee with
individual recommendations and the accompanying fiscal notes.
There being no objection, HB 30 was reported from the House
Labor and Commerce Standing Committee.
4:16:07 PM
The committee took an at-ease from 4:16 p.m. to 4:17 p.m.
HB 149-CHILD CARE PROVIDER COLLECTIVE BARGAINING
4:17:13 PM
CO-CHAIR SPOHNHOLZ announced that the next order of business
would be HOUSE BILL NO. 149, "An Act relating to allowing
certain child day care providers to organize for the purpose of
collective bargaining."
4:17:32 PM
CO-CHAIR FIELDS introduced HB 149 as prime sponsor and explained
that he thought it would be useful for the committee to address
the gender pay gap, female participation in the workforce, and
the devastation the child care industry has experienced due to
the COVID-19 pandemic. He offered a PowerPoint presentation
entitled, "Raising Wages & Benefits for Child Care Workers (HB
149)," and covered the information, on slide 2, "Problem:" which
read as follows [original punctuation provided]:
• Persistent low wages and benefits result in high
turnover and inadequate supply of child care workers.
• Low wages/benefits discourage investment in quality
instruction
CO-CHAIR FIELDS proceeded to slide 3, "Why does it matter?" and
explained that inadequate child care has been causing parents to
leave Alaska and is contributing to population decline. He
explained that while every state faces child care problems,
Alaska may actually be able to solve these problems as it is a
small state. The slide read as follows [original punctuation
provided]:
• Alaska needs to attract and retain high-earners
including parents with families (currently losing
population among age 3050)
• Early childhood education has greatest impact on
human capital development, and highest ROI
CO-CHAIR FIELDS advanced to slide 4, "Lessons from other
States/Nations," which read as follows [original punctuation
provided]:
• 11 U.S. states have established bargaining
structures for homebased child care providers to
bargain with state to establish livable wages and
benefits that expand supply of child care providers
• First state: Illinois, 2005. California most recent
state to adopt model.
• European countries directly subsidize child care
centers for parents of all income levels, and provide
tax credits
• And Northern Europe uses sectoral bargaining to set
wages/benefits
CO-CHAIR FIELDS stated that HB 149 follows the model that 11
other states are already following. He said that he intends
this bill to spark conversation in the committee and that he is
open to there being other potential models the state could
implement to solve this problem.
CO-CHAIR FIELDS moved to slide 5, "Mechanisms to Raise Wages,"
and shared his understanding that the reason why construction
workers make middleclass wages is arbitrary, and was just a
policy decision. He offered the idea that perhaps the same
should be done for child care. The slide read as follows
[original punctuation provided]:
• Collective Bargaining (U.S. model / H.B. 149)
• Establishing prevailing wages (based on U.S.
construction policy model)
• Directly subsidize (Europe model)
4:21:59 PM
CO-CHAIR FIELDS proceeded to slide 6, "Why Now?" which read as
follows [original punctuation provided, with some formatting
changes]:
• Growing federal support for child care-> To deploy
most effectively, need the right policy framework
• Pandemic decimated female participation in workforce
AND crushed many child care providers-> Need to help
industry and working families recover
CO-CHAIR FIELDS added that the collective bargaining process is
proposed differently under HB 149 in that the child care
providers are allowed to determine whether they would like to
engage in bargaining.
4:23:37 PM
KIMBERLY ROSENBERGER, Service Employees International Union
(SEIU), offered a PowerPoint presentation entitled, "AB 378:
Providers' Vision for Their Union," and explained that AB 378
relates to the assembly bill that passed in 2019 in California
that authorized child care providers to collectively bargain.
She began on slide 2, which read as follows [original
punctuation provided]:
After 16 years, providers win right to choose a union.
Similar to 11 other states. Bill enables:
Election to choose union
Collective bargaining
Training partnership
MS. ROSENBERGER added that this is necessary because child care
providers are considered small businesses and are therefore not
covered by a number of wage or labor laws. Child care employees
were considered low wage workers, she said. To combat this,
SEIU had to get an anti-trust exception which would allow the
State of California to determine that the benefit of collective
bargaining outweighs the risk of anti-competition.
MS. ROSENBERGER showed the information on slide 3, which read as
follows [original punctuation provided]:
Also covers the following:
Set of topics standard to many labor laws
Current labor law did not cover providers
Defines who is included:
Providers who care for state-subsidized kids
Includes licensed and license-exempt
Not assistants or centers
4:26:08 PM
MS. ROSENBERGER continued to slide 4, "Collective Bargaining
Scope," which read as follows [original punctuation provided]:
Addressed in section 8434.5 of bill
Lists required subjects; others permissible Rates,
benefit trust fund, training, improving provider
retention/recruitment
Funding must be passed by Legislature
Does not include non-state controlled topics
MS. ROSENBERGER moved to slide 5, "Process for representation,"
which read as follows [original punctuation provided]:
Addressed in section 8434 of bill
Adapts law for many CA public employees
Includes:
Show provider interest
List of eligible voters
Notifying providers Timelines, other guidance
MS. ROSENBERGER advanced to slide 6, "Training partnership," and
explained that training is essential as many entities cannot
remain open while also providing sufficient training. The slide
read as follows [original punctuation provided]:
Addressed in section 8442 of bill
Shorter language in final bill
Intent the same: consult with partners about
training, professional development $, programs
Lists required partners including R&R Network,
others possible
4:28:01 PM
MS. ROSENBERGER proceeded to slide 7, "In other states," which
read as follows [original punctuation provided]:
Providers in 11 other states have a voice through
their union. Typical improvements:
Higher rates + add'l for training, infants,
nontraditional hours
Health care thru a union trust
Voice in regulation and quality improvement
Expanded training
Smoother eligibility process for parents
MS. ROSENBERGER reminded the committee that California is the
newest state to join SEIU and has already seen the benefits of
being part of the union.
4:29:03 PM
CO-CHAIR SPOHNHOLZ invited questions from the committee.
4:29:06 PM
REPRESENTATIVE KAUFMAN asked Ms. Rosenberger what the other 11
states are that have joined the union.
MS. ROSENBERGER asked if she could get back to him on that and
noted that there is a document that lists the states that she
could share with the committee.
4:29:49 PM
CO-CHAIR FIELDS responded that Illinois, Oregon, Washington,
Iowa, New Jersey, Michigan, and Wisconsin were some of the first
to join the union as of 2007, and since then, New York,
Pennsylvania, Kansas, Maryland, Ohio, Maine, and New Mexico have
joined.
4:30:31 PM
REPRESENTATIVE KAUFMAN noted that organizing will cause costs to
go up, and asked how that improves accessibility.
CO-CHAIR FIELDS answered that this would be one multi-employer
election overseen by the Alaska Labor Relations Agency (ALRA),
which has provided a fiscal note. In terms of accessibility, he
stated that small businesses have a difficult time finding high-
quality and affordable health insurance and organizing would
make it easier for these businesses to access benefits. He
reiterated that high quality training also contributes to a more
efficient system, and it has been demonstrated that it results
in lower employee turnover. He noted that if an individual
wants to pay more for high quality child care, that level of
care is not available at a higher price because child care
workers are considered low wage workers. He explained that some
of this is historical as child care workers are often people of
color, and he shared his understanding that the United States
Congress didn't want to give collective bargaining rights to
people of color. He said that farm workers, domestic workers,
and women were excluded from collective bargaining rights.
4:33:04 PM
MS. ROSENBERGER added that one of the benefits SEIU has seen
after implementing collective bargaining and increasing wages
and training has been more employees staying in the child care
field. She stated that the stance of SEIU is that there is more
of a return on investment by growing the workforce and
maintaining the workers that have entered the field already.
4:33:56 PM
REPRESENTATIVE SNYDER recalled her time utilizing child care
professionals for her own children and shared that she located a
worker through Thread, Alaska. She shared that this individual
was a small, in-home daycare provider and asked how this might
affect someone like her.
CO-CHAIR FIELDS responded that it would be her choice to
unionize. He emphasized that this bill aims to give in-home
providers the mechanisms to create a more sustainable business
model and supply the amount of child care that working
professionals need.
4:35:10 PM
MS. ROSENBERGER said that there was an overwhelming response
from child care providers, but child care providers determine
whether to opt in or abstain. In California, this only applies
to those who receive subsidies, she noted, and many child care
providers have chosen to join the union to benefit from the
training mechanisms that it provides. It also gives providers a
voice when it comes to new and necessary regulations. She
shared that there is a 97 percent approval rate among providers
who have opted in.
4:36:20 PM
TRISTAN WALSH, Staff, Representative Zack Fields, Alaska State
Legislature, presented the Sectional Analysis on HB 149 on
behalf of Representative Fields, prime sponsor. He read
Sections 1-10, which read as follows [original punctuation
provided]:
Section 1: This section amends AS 23.40.070, the
declaration of policy regarding the Public Employment
Relations Act, to include child day care providers.
Section 2: This section amends AS 23.40.080 to give
child day care providers the right to self-organize,
join or assist an organization to bargain collectively
and engage in concerted activities for the purposes of
collective bargaining or other mutual aid or
protection.
Section 3: This section amends AS 23.40.090 to include
child day care providers in the definition of
collective bargaining unit.
Section 4: This section amends AS 23.40.100(a) to
include child day care providers in the statute
regarding the election of representatives and
organizations for collective bargaining.
Section 5: This section amends AS 23.40.100(b) adds
child day care providers to the statute that directs
the labor relations agency to officiate the election
on representation following the determination that a
question of representation exists.
Section 6: This section amends AS 23.40.110(a) to add
child day care providers to the statute prohibiting
unfair labor practices by the public employer or agent
of the public employer.
Section 7: This section makes conforming changes in AS
23.40.205, regarding public employee family leave
benefits.
Section 8: This section amends AS 23.40.210(d) to make
conforming changes.
Section 9: This section amends AS 23.40.225 to add
child day care providers. It clarifies that child day
care provider have the right of non-association.
Section 10: This adds a new section to AS 23.40 to add
language that clarifies that nothing in this bill
makes child day care providers and organizations
public employees, their inclusion in this bill does
not form or terminate employer-employee relationship,
change a child care provider's legal status as an
entity, corporation or sole proprietorship. It also
declares nothing in this bill is intended to interfere
with compliance by a person, the state or political
subdivision of the state with a federal law or
requirement of a federal grant or subsidy. It also
states that nothing in this bill prohibits a child day
care provider from communicating with a public
employer or another person. It also states that a
child day care provider organization (union) may not
process or administer payments for day care.
4:39:36 PM
MR. WALSH explained that sections 11-23 are conforming changes
in definition.
4:39:46 PM
CO-CHAIR SPOHNHOLZ expressed that she is confused about the
statute being updated referencing a public employee or an agent
of a public employee [in Section 6 of the Sectional Analysis],
but the bill does not designate child care employees as public
employees.
CO-CHAIR FIELDS responded that that is correct. Child care
workers are not becoming public employees, but are simply being
given a mechanism to bargain in the child care sector.
CO-CHAIR SPOHNHOLZ commented that it is an interesting section
of law in which to put the bill.
CO-CHAIR FIELDS replied that it goes back to the historic
exclusion from the National Labor Relations Act (NLRA).
4:40:29 PM
MS. ROSENBERGER explained that the reason that designation is so
important is because child care providers want to maintain their
status as a small business and are dealing with the state
already in regard to subsidies. There is already an interaction
between the state and these small business, but HB 149 would
allow the businesses to collectively negotiate that existing
relationship.
CO-CHAIR SPOHNHOLZ directed the same question to an attorney
from Legislative Legal and Research Services.
4:41:25 PM
DANIEL WAYNE, Attorney, Legislative Legal Counsel, Legislative
Legal and Research Services, Legislative Affairs Agency (LAA),
reiterated that this approach was used in California and some of
the other aforementioned 11 states. He explained that the bill
would broaden the mission of the ALRA to include oversight of
labor issues for child daycare providers. If this bill was
referring to other types of workers, for example, transportation
workers, then Alaska might be preempted as a state from
regulating labor in that sector because transportation workers
are already covered by NLRA, whereas child care workers are not
covered.
4:43:03 PM
CO-CHAIR FIELDS added that if an individual is a single provider
of child care, there is no one with whom that individual can
form a union. For this reason, he stated that it is important
for small businesses in the industry to work together.
4:43:19 PM
REPRESENTATIVE MCCARTY asked Mr. Wayne whether the bill is
stating that while these child care workers are recognized as an
entity of the state, the workers are not "connected" to the
state, but are "subsidized by the state, for the recognition
with the state."
MR. WAYNE responded that he was not sure that was accurate. He
said he doesn't think that the state would be subsidizing
anyone. The bill would simply put ALRA in charge of regulating
labor disputes and labor action between child care providers and
public employers, he explained.
4:44:49 PM
CO-CHAIR FIELDS shared that this is an approach to "sectoral
bargaining," where there is an attempt to raise standards in a
section of an industry. He shared his opinion that the U.S. has
a fairly outdated approach to labor relations with the
bargaining based on a firm in combination with a racist and
sexist history where women and farmworkers were excluded from
NLRA. This bill would attempt to bring a sectoral bargaining
framework to one sector that was historically excluded from
federal labor law, and that is why it is "pigeon-holed" in
bargaining with the state. He offered that a way to understand
it is that the bill would be providing a framework for sectoral
bargaining for small businesses.
4:45:55 PM
CO-CHAIR SPOHNHOLZ reminded the committee that this was an
introductory hearing, and the committee would have more time to
discuss HB 149 in the future.
4:46:27 PM
REPRESENTATIVE MCCARTY shared his understanding that the state
is subsidizing the programs, and asked for clarification on that
point.
CO-CHAIR FIELDS responded that subsidies are already provided
based on eligibility to certain families, and that would
continue if this bill were to pass. If the federal government
chooses to subsidize child care in a more meaningful way, then
HB 149 would allow the State of Alaska to capitalize on that.
In closing, he shared that he would be open to other ideas to
improve child care, but that he thinks that the committee needs
to address the issue.
4:47:45 PM
CO-CHAIR SPOHNHOLZ announced that HB 149 was held over.
HB 110-AGE FOR NICOTINE/E-CIG; TAX E-CIG.
4:47:54 PM
CO-CHAIR SPOHNHOLZ announced that the next order of business
would be HOUSE BILL NO. 110, "An Act raising the minimum age to
purchase, sell, exchange, or possess tobacco, a product
containing nicotine, or an electronic smoking product; relating
to transporting tobacco, a product containing nicotine, or an
electronic smoking product; relating to the taxation of
electronic smoking products; and providing for an effective
date."
4:48:12 PM
REPRESENTATIVE SARA HANNAN, Alaska State Legislature, explained
that HB 110 would primarily accomplish two items: it would
change the state law regarding tobacco and tobacco products in
confirmation with the federal law by changing the sell age from
19 to 21; and it would put an excise tax onto electronic
cigarettes or "e-cigarettes." She continued that Alaska taxes
tobacco depending on the type of tobacco product. She said that
the last time tobacco taxes were changed was 12 years ago when
e-cigarettes weren't as prominent as they are now. This means
that currently, there are no taxes on e-cigarettes in Alaska.
She made the distinction that cannabis e-cigarettes are taxed at
the same rate as other cannabis products because e-cigarettes
did exist when the cannabis industry began in Alaska.
REPRESENTATIVE HANNAN recalled that during the Thirty-First
Alaska State Legislature, there were two bills that intended to
do the same things that HB 110 proposes, but that she combined
them into one bill. She opined that the bill is simple, but
appears long and complicated because the age change appears in a
number of places in the statutes. She added that tobacco is a
highly regulated product across the nation, so the federal
government has always had a strong hand in regulation. There
has been a disruption created in that oversight with e-
cigarettes because they do not always start with raw tobacco and
do not typically end up being sold by the same retailers.
REPRESENTATIVE HANNAN shared that e-cigarettes have become
popular among young people who are under the age of 21 and often
under the age of 19. The Center for Disease Control (CDC)
conducts a national tobacco survey every other year, she said,
and between 2017 and 2018, the CDC found a 78 percent increase
in the use of e-cigarettes by high school students. There has
been a downturn in other tobacco products, but e-cigarettes have
become an "entre into the nicotine addiction," she continued.
She stated that nicotine is a highly addictive substance and if,
by adding e-cigarettes into a tax structure, the price of e-
cigarettes can be increased and therefore deter young people
from buying them, there will at least be a delay in access to
nicotine. She noted that there is a perception among young
people that e-cigarettes are not as risky as other nicotine
products, but there is no research that supports that.
Conversely, research shows that an addiction may come on more
quickly with the use of e-cigarettes because the rate of
absorption is much higher.
4:53:35 PM
REPRESENTATIVE HANNAN explained that the goal of the proposed
bill is to discourage young people from smoking, conform
Alaska's laws to the federal standards, and produce some
revenue. She added that the bill would also prohibit the e-
cigarettes products from being sold over the Internet and
require age-verification when a purchaser buys e-cigarettes that
are delivered to them.
4:55:12 PM
EMILY NENON, Alaska Government Relations Director, American
Cancer Society Cancer Action Network, shared that she has been
working on tobacco prevention policy for a number of years, and
she works closely with the American Heart Association and the
American Lung Association. Increasing the price of e-cigarettes
is a critical strategy in decreasing youth tobacco use and from
preventing youth from ever starting to consume tobacco products,
she continued. She stated that increasing the price is one of
three strategies that are most successful in decreasing youth
tobacco use. The other two strategies are having a
comprehensive prevention program and having smoke-free
workplaces. She stated that early in her career, she worked on
the 2004 tobacco tax increase in Alaska, and she noted that the
tax statute hasn't changed since then, but the market has. She
said that the market has expanded significantly, especially with
the latest generation of e-cigarette products. These e-
cigarette products combine technological advancements with
flavored nicotine. She mentioned nicotine salts, which ease the
"throat hit" of nicotine, as an example of the way in which
these products are made easier for youth to use and put them at
a greater risk of developing an ongoing addiction.
MS. NENON continued that the American Cancer Society Cancer
Action Network shares the concerns about the health effects of
e-cigarettes. She shared that a frequent question is, "How do
these e-cigarettes compare with the health harms of regular
cigarettes?" She asked the committee to consider this: the
combusted cigarette has over 3,000 chemical compounds, and 69 or
70 of those are known human carcinogens or cancer-causing
agents. It is not difficult to be less harmful than the
combusted cigarette, she said. She stated that the health
organizations do support removing old penalties for youth
possessing tobacco and are in favor of helping youth get access
to tobacco cessation services rather than criminalizing youth
for being addicted to a product that has been heavily marketed
to them.
4:59:30 PM
CO-CHAIR SPOHNHOLZ invited questions from the committee.
5:01:22 PM
REPRESENTATIVE KAUFMAN said that he has received arguments on
both sides of this issue. There is a concern that increasing
taxes will increase the "black market," and he stated that he
shares this concern.
5:02:12 PM
REPRESENTATIVE HANNAN emphasized that there is no tax right now.
This would add tax into the structure, not increase existing
tax. She added that the black market for e-cigarettes exists,
but anyone who is under the age of 19 is already illegally
purchasing and consuming nicotine. She asked him to consider
whether, by adding taxes to the structure, the state might gain
a better control on the black market that already exists.
5:03:05 PM
MS. NENON shared that the black market reasoning is something
that comes up often in the discussion of tobacco regulation.
She highlighted that buying patterns are an important topic to
consider, as most users of regular tobacco products want to quit
and buy tobacco products one pack at a time. She noted that
this bill is timely because it follows behind a "major overhaul"
in federal law regulations on common carriers being able to ship
e-cigarette products. She shared that there is much more of an
emphasis on catching illegal products before they can enter the
market than there used to be, and that addition regulations on
shipping will help with that as well.
REPRESENTATIVE KAUFMAN responded that another common point of
discussion is that people say they use e-cigarettes to quit
smoking cigarettes. He asked if she thinks there is any merit
to that argument.
MS. NENON responded that her advice to these individuals wanting
to quit is to use Food and Drug Administration (FDA) approved
tobacco cessation products that are subject to rigorous medical
standards. She said that no e-cigarette company has applied to
have its products be treated as tobacco cessation products by
the FDA. She emphasized that e-cigarettes are not tobacco
cessation products. The biggest impact will come from keeping
kids from ever starting to consume these tobacco products, she
added.
5:06:27 PM
CO-CHAIR FIELDS added that when e-cigarette products first came
out, they were marketed as tobacco cessation devices, but that
that marketing device was belied by companies marketing directly
to kids who were not addicted yet by utilizing certain colors
and flavors to appeal to them. The claim was also belied when
"big tobacco" took over these e-cigarette companies. He
concluded that if the claim that e-cigarettes help people to
stop smoking were true, those companies would've applied to be
considered smoking cessation devices and these big tobacco
companies wouldn't have aggressively marketed the products to
kids.
CO-CHAIR SPOHNHOLZ shared a personal anecdote about a family
member who used to smoke traditional cigarettes and now smokes
e-cigarettes, and he is "as hooked as he was before, he just
smells different."
5:07:29 PM
REPRESENTATIVE HANNAN directed attention to Section 3 of the
bill and explained that this section states that proven tobacco
cessation products would be excluded from the proposed taxation
statutes.
5:08:23 PM
REPRESENTATIVE MCCARTY asked where the age change from 19 to 21
is being implemented in other states.
REPRESENTATIVE HANNAN replied that it depends on the state. She
said that she has information of how each state has complied,
but she may have to get back to the committee with that
information.
5:09:29 PM
MS. NENON responded that the FDA is responsible for
implementation up to age 21 across the nation, and then every
state has its own laws. This bill would update Alaska's statute
so that the state can implement regulations on top of the
federal requirements in compliance. She added that Alaska has a
successful compliance program with vendor education, but would
like to be able to do that work up to age 21 instead of relying
on the FDA, but the FDA is doing that work now across the
nation.
5:10:17 PM
CO-CHAIR SPOHNHOLZ announced that HB 110 was held over.
^CONFIRMATION HEARING(S):
CONFIRMATION HEARING(S):
^State Board of Registration for Architects, Engineers & Land
Surveyors
State Board of Registration for Architects, Engineers & Land
Surveyors
^State Physical Therapy & Occupational Therapy Board
State Physical Therapy & Occupational Therapy Board
^Board of Dental Examiners
Board of Dental Examiners
^Board of Examiners in Optometry
Board of Examiners in Optometry
^Board of Marital & Family Therapy
Board of Marital & Family Therapy
^Board of Professional Counselors
Board of Professional Counselors
^Board of Psychologist & Psychological Associate Examiners
Board of Psychologist & Psychological Associate Examiners
^Board of Social Work Examiners
Board of Social Work Examiners
^Regulatory Commission of Alaska
Regulatory Commission of Alaska
5:10:51 PM
CO-CHAIR SPOHNHOLZ announced that the final order of business
would be confirmation hearings in consideration of the
governor's appointees to the various boards and commissions.
CO-CHAIR SPOHNHOLZ stated that the House Labor and Commerce
Standing Committee had reviewed the qualifications of the
following governor's appointees for consideration: Jake
Maxwell, Arpad "Bruce" Magyar, and Catherine Fritz to the State
Board of Registration for Architects, Engineers and Land
Surveyors; Nathan Missler to the State Physical Therapy and
Occupational Therapy Board; Christina Hansen, Bradley Heaston,
and Gregory Johnson to the Board of Dental Examiners; Pamela
Steffes and Michael Mavencamp to the Board of Examiners in
Optometry; Richard Clampitt, Joy Collins, and Kayla Green to the
Board of Marital and Family Therapy; Sammie O'Neal and Eleanor
Vinson to the Board of Professional Counselors; Bernard
Gatewood, Bradley McConnell, and Sherri Scott to the Board of
Psychologist and Psychological Associate Examiners; Brandon
Ercanbrack to the Board of Social Work Examiners; and Robert
Pickett and Keith Kurber to the Regulatory Commission of Alaska.
She noted that each member's signature on the committee's report
in no way reflects the member's vote during the joint floor
session. There being no objection, the confirmations were
advanced.
5:12:34 PM
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
5:12 p.m.