02/12/2025 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| Presentation(s): Role of Apprenticeships in Alaska's Workforce Development | |
| HB80 | |
| HB74 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 80 | TELECONFERENCED | |
| *+ | HB 74 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
February 12, 2025
3:18 p.m.
MEMBERS PRESENT
Representative Zack Fields, Co-Chair
Representative Carolyn Hall, Co-Chair
Representative Ashley Carrick
Representative Robyn Niayuq Burke
Representative Dan Saddler
Representative Julie Coulombe
Representative David Nelson
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
PRESENTATION(S): ROLE OF APPRENTICESHIPS IN ALASKA'S WORKFORCE
DEVELOPMENT
- HEARD
HOUSE BILL NO. 80
"An Act relating to minimum standards for residential buildings;
relating to construction contractors and residential contractor
endorsements; establishing the Alaska State Residential Building
Safety Council; and providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 74
"An Act establishing the crime of airbag fraud."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 80
SHORT TITLE: RESIDENTIAL BUILDING CODE
SPONSOR(s): LABOR & COMMERCE
01/31/25 (H) READ THE FIRST TIME - REFERRALS
01/31/25 (H) L&C
02/03/25 (H) L&C AT 3:15 PM BARNES 124
02/03/25 (H) <Bill Hearing Canceled>
02/10/25 (H) L&C AT 3:15 PM BARNES 124
02/10/25 (H) Heard & Held
02/10/25 (H) MINUTE(L&C)
02/12/25 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 74
SHORT TITLE: CRIME COUNTERFEIT/NONFUNCTIONING AIRBAG
SPONSOR(s): TOMASZEWSKI
01/29/25 (H) READ THE FIRST TIME - REFERRALS
01/29/25 (H) L&C, JUD
02/07/25 (H) L&C AT 9:00 AM BARNES 124
02/07/25 (H) -- MEETING CANCELED --
02/12/25 (H) L&C AT 3:15 PM BARNES 124
WITNESS REGISTER
DOUG TANSY, Business Manager
International Brotherhood of Electrical Workers
Juneau, Alaska
POSITION STATEMENT: Co-offered the presentation on the Role of
Apprenticeships in Alaska's Workforce Development.
NANCY MERRIMAN, CEO
Alaska Primary Care Association
Anchorage, Alaska
POSITION STATEMENT: Co-offered the presentation on the Role of
Apprenticeships in Alaska's Workforce Development.
TARI O'CONNOR, Chief Program Officer
Alaska Primary Care Association
Anchorage, Alaska
POSITION STATEMENT: Co-offered the presentation on the Role of
Apprenticeships in Alaska's Workforce Development.
HILTON HALLOCK, Provost
Alaska Pacific University
Anchorage, Alaska
POSITION STATEMENT: Co-offered the presentation on the Role of
Apprenticeships in Alaska's Workforce Development.
AARON WELTERLEN, Vice President
Interior Alaska Building Association
Alaska State Home Building Association
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HB 80.
DAVID MILLER, Past President
Board of Directors
Mat-Su Home Builders Association
Palmer, Alaska
POSITION STATEMENT: Testified during the hearing on HB 80.
LEAH WINTERS, Public Policy Fellow
Cold Climate Housing Research Center
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HB 80.
EDNA DEVRIES, Mayor
Matanuska-Susitna Borough
Palmer, Alaska
POSITION STATEMENT: Testified in opposition to HB 80.
PETER MICCICHE, Mayor
Kenai Peninsula Borough
Kenai, Alaska
POSITION STATEMENT: Testified in opposition to HB 80.
DEAN BARTSCH, representing self
Nikiski, Alaska
POSITION STATEMENT: Testified in opposition to HB 80.
FRANK TOMASZEWSKI
Alaska State Representative
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 74.
DAVID GOFF, Staff
Representative Tomaszewski
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As staff to Representative Tomaszewski,
prime sponsor of HB 74, read the sectional analysis of HB 74.
CRAIG ORLAN, Director of State and Local Government Affairs
American Honda Motor Co., Inc.
Alexandria, Virginia
POSITION STATEMENT: Gave invited testimony in support of HB 74
and answered questions.
ACTION NARRATIVE
3:18:10 PM
CO-CHAIR ZACK FIELDS called the House Labor and Commerce
Standing Committee meeting to order at 3:18 p.m.
Representatives Coulombe, Burke, Hall, and Fields were present
at the call to order. Representatives Nelson, Saddler, and
Carrick arrived as the meeting was in progress.
^PRESENTATION(S): Role of Apprenticeships in Alaska's Workforce
Development
PRESENTATION(S): Role of Apprenticeships in Alaska's Workforce
Development
3:18:27 PM
CO-CHAIR FIELDS announced that the first order of business would
be a presentation on the Role of Apprenticeships in Alaska's
Workforce Development.
3:18:50 PM
DOUG TANSY, Business Manager, International Brotherhood of
Electrical Workers (IBEW), co-offered the presentation on the
Role of Apprenticeships in Alaska's Workforce Development. He
shared that he started an apprenticeship as soon as he graduated
high school and was looking into homeownership within 5 years.
He stated that going through an apprenticeship allowed him to
obtain continuing education without debt and ultimately made him
a better citizen.
MR. TANSY commented that many of the individuals exiting their
programs are financially stable with good prospects. He
asserted that apprenticeships keep people in their communities.
He asserted that apprenticeships allow people to retire on time,
"when they are expected to retire." He stated that he is both a
proponent and beneficiary of apprenticeships. Additionally, he
reported that the International Brotherhood of Electrical
Workers has historically high enrollment numbers. He offered
his desire to see apprenticeship programs expanded beyond the
construction industry.
3:23:05 PM
CO-CHAIR FIELDS stated that apprenticeships are industry funded.
He asked Mr. Tansy to talk about how contractors and the union
jointly manage apprenticeships.
MR. TANSY answered that each trust is jointly managed by the
Alaska Chapter of the National Electrical Contractors
Association (AK NECA) and the IBEW Local 1547. He explained
that the trusts are paid into by "every hour worked in the
field." He stated that every apprentice accepted into IBEW's
program is awarded a roughly $50,000 scholarship. He stated
that apprentices are responsible only for their books and
materials, which they are allowed to take home. Further, he
stated that they provide the school, labs, and lab materials.
3:24:30 PM
CO-CHAIR FIELDS invited questions from committee members.
3:24:37 PM
CO-CHAIR HALL asked why there is an overwhelming number of
applicants for the apprenticeship program. She noted that other
industries have cited workforce development and shortage [of
applicants] as top priorities.
3:25:10 PM
MR. TANSY responded that IBEW began to focus on recruitment
approximately 10 years ago in response to attrition. He stated
that the union changed its recruitment strategy to clearly
signal to potential applicants that the construction industry
was not limited to those who were not on college tracks. He
reported that college graduates and valedictorians apply for
their programs. He further reported that they have applicants
interested in telecommunications, and electrical work.
MR. TANSY reported that, in both the Anchorage and Fairbanks
training centers, every week of the [current] school year is
booked, with weekends and evenings the only available timeslots.
Mr. Tansy further reiterated that IBEW invests heavily in its
recruits by providing scholarships and wages, and he asserted
that this is attractive to potential applicants.
MR. TANSY concluded with a brief anecdote about a prior student
who, after completion of an apprenticeship program in the
[Fairbanks] North Star Borough, was able to purchase a vehicle,
put over 25 percent down payment on a home, and had just passed
his journeyman licensing.
MR. TANSY offered his belief that increased recruitment into
apprenticeships would result in better communities, better
schools, less recidivism, and more civic engagement.
3:28:12 PM
CO-CHAIR FIELDS stated that the focus of the presentation would
shift towards healthcare apprenticeships in Alaska's workforce
development.
3:28:32 PM
REPRESENTATIVE CARRICK noted that Alaska recently experienced a
loss of funding of millions of dollars through the Statewide
Transportation Improvement Program (STIP). She remarked that
one outcome may be apprentices graduating without guaranteed
employment.
MR. TANSY responded that some of IBEW's contractors have
received notice to halt energy projects. He explained that IBEW
does not have a predetermined number of apprentices and
acceptance into the program is based on the available work
opportunities. He stated that it is IBEW's responsibility to
ensure that it only accepts applicants that it can place in
jobs. He stated that when there is a disruption of funding,
apprentices will leave, or switch industries because of the
instability. He also noted that it is a lost investment for
IBEW, both monetarily and timewise, as the program generally
takes about 5 years. He asserted that a lack of federal funding
would negatively impact career development and potentially turn
people away to different career pathways.
REPRESENTATIVE CARRICK commented that it is a shame that
administrative negligence could lead to a loss of potential
apprentices.
3:32:00 PM
CO-CHAIR FIELDS commented that the congressional delegation
worked hard for the Grid Resilience and Innovation Partnerships
Program (GRIP) funding and funding for rural projects through
the Tanana Chiefs Conference (TCC). He offered his
understanding that there is $250,000 currently on hold, as well
as permitting projects, due to the "federal grants pause." He
additionally commented that the Trump administration has
additionally paused some permitting projects, including some in
the rail belt. He requested Mr. Tansy speak to the importance
of strengthening the grid for contractors and members.
3:32:53 PM
MR. TANSY opined that GRIP funding was decades delayed, as
Alaska needed improved roads, airports, water ports, and
bridges. Additionally, he noted it was a huge relief when the
congressional delegation secured GRIP funding. He said that
Alaska's energy consumption and needs are much different from
what was projected approximately 10 years ago. Further, he
asserted that Alaska's transmission system is "decades
deficient" and a "bottleneck," meaning it does not provide the
cheapest power to the consumer, and it does not allow for
alternative energy sources, such as windfarms or solar power,
due to limited storage capacities. He offered his belief that
Alaska's future is dependent on its energy landscape. He
reiterated that pauses in [federal] funding are "damaging" and
set Alaska "back [by] decades."
3:34:55 PM
NANCY MERRIMAN, CEO, Alaska Primary Care Association (APCA),
continued the presentation. She stated that APCA supports the
operations and development of Alaska's 29 federally qualified
health centers. She reported that health centers across Alaska
provide care to one in six Alaskans. She explained that APCA's
apprenticeship program was established in 2017 in partnership
with the Department of Labor and Workforce Development (DOLWD).
She stated that Alaska health centers have, for years, cited
workforce as one of their primary challenges. As a result, APCA
became a multi-employer apprenticeship program sponsor through
the U.S. Department of Labor (DoL), and APCA partnered with
Alaska Pacific University (APU) to extend the value and meaning
of apprenticeships to [traditional] academic pathways.
MS. MERRIMAN stated that APCA received some grants in 2017,
whose funds were used to create registered apprenticeship
programs for entry-level positions in healthcare. She noted
that registered apprenticeship programs can be complex, with a
plethora of rules and mandatory reporting requirements. She
commented that APCA has learned a lot since its establishment
eight years prior and that employee recruitment, training, and
retention have changed in the modern era. She stated that
health care centers are hiring people with little to no exposure
to a healthcare field. She asserted that frontier and rural
areas need programs that are asynchronous, online, and paced to
an individual's needs.
MS. MERRIMAN noted that APCA has expanded its programs to
include non-registered apprenticeships in addition to registered
apprenticeships. She explained that the delivery of non-
registered apprenticeships is modified to fit the scheduling,
pacing, and timing needs of Alaska. She asserted that the non-
registered apprenticeships provide quality training and further
noted that APCA has shifted focus to meeting the needs of both
employers and employees in Alaska.
3:39:07 PM
TARI O'CONNOR, Chief Program Officer, Alaska Primary Care
Association, continued the presentation. She stated that
apprenticeship programs at APCA are distance-delivered, allowing
employers throughout Alaska to train staff in their communities.
She reported that [APCA] has almost 100 apprentices currently in
training by more than 25 different employers, including
hospitals, private healthcare providers, tribal healthcare
organizations, and social service organizations. She reported
that of the nine registered apprenticeship programs that APCA
sponsors, the most popular are clinical medical assistant,
pharmacy technician, and billing and coding specialist.
MS. O'CONNOR announced that they are launching a new project
partnership with the Anchorage Neighborhood Health Center, with
a focus on dental assistants. She explained that under the new
partnership, APCA would provide the apprenticeship structure and
administration, while the Anchorage Neighborhood Health Center
would provide would hire personnel and provide the direct on-
site instruction. Additionally, she stated that APCA, in
response to employer feedback, has been expanding outside of
formal registered apprenticeship programs. She explained that
[unregistered programs] are shorter in length, more flexible,
and provide for both asynchronous and synchronous learning
opportunities.
MS. O'CONNOR further mentioned that APCA provides "pre-
apprenticeship" training, which prepares people to work in a
formal workplace. She explained that students learn soft skills
such as teamwork and self-care and earn some "basic
certifications."
3:41:36 PM
MS. MERRIMAN concluded with a request for outreach support from
legislators to assist in the promotion of apprenticeship
programs. She suggested [legislators] add information about the
apprenticeship programs in their newsletters.
3:42:14 PM
CO-CHAIR FIELDS asked whether school districts were sufficiently
aware of APCA apprenticeships. Further, he asked whether there
was adequate structure for the school to apprenticeship
pathways.
MS. MERRIMAN offered her belief that there are some school
districts aware of the apprenticeship programs. She reported
that, through work with a school district, APCA had discovered
that juniors and seniors are most likely to successfully handle
a job in conjunction with training.
3:43:15 PM
REPRESENTATIVE COULOMBE voiced concern about a new person with
very little training delivering healthcare on the job.
3:44:05 PM
MS. MERRIMAN responded that healthcare careers typically have
very long training programs, both academic and in the field.
She noted that they typically start off in positions with very
minimal patient interaction. She reported that APCA's most
popular profession, clinical medical assistant, is a longer
program and always supervised and mentored through the training
program.
3:45:15 PM
MS. O'CONNOR added that the requirement for supervision can be a
limitation on capacity for programs. She explained that, to
ensure appropriate supervision in any given site, a supervisor
can adequately supervise only a limited number of people.
3:45:54 PM
CO-CHAIR FIELDS stated that when federal funding "fell off" and
state capital budgets "fell off," there was a drop in the number
of construction workers. With a one-to-one ratio of mentors to
apprentices, the [construction] industry can grow only so fast.
He asserted that stability in funding allows for safe and
adequate mentorship.
CO-CHAIR FIELDS stated that, historically in America,
[apprenticeship] training and [continuing] education have been
separated.
3:47:27 PM
HILTON HALLOCK, PhD, Provost, Alaska Pacific University (APU),
as an invited testifier, finished the presentation on
apprenticeships in Alaska. She explained that APU is a small,
independent university located primarily in Anchorage, with some
instructional locations throughout Alaska. She reported that 88
percent of students enrolled at APU are from Alaska. She stated
APU has programs ranging from undergraduate certificates to
doctoral degrees, with the goal of providing academic programs
and educational opportunities that meet Alaska's critical needs.
DR. HALLOCK continued with an overview of the programs offered
at APU. She stated that APU offers an Alaska Rural Management
Certificate in Business to help prepare communities for the
management of infrastructure projects, sponsored in part by the
Denali Commission. Additionally, APU offers certificates,
associates, and bachelors in Environmental Health Programs to
help students address serious public health issues, such as
water and air quality. She stated that APU is currently working
with East High School (EHS) through Academies of Anchorage to
allow high-school students to graduate with industry credits.
Further, she reported that APU has launched three nursing
degrees and a Licensed Practical Nurse (LPN) to Registered Nurse
(RN) bridge in the last eight years. She stated that APU
received a $5-million grant from the DoL to expand the nursing
workforce in Alaska and APU is working closely with partner-
employers on the development of "earn-and-learn programs."
DR. HALLOCK described APU's approach to workforce development as
"innovative" and stated that APU is well-suited for
apprenticeships and other workforce/competency-based programs
because the college has always incorporated experiential
learning in their degree programs. She listed examples of
apprenticeship programs offered at APU, including teacher
apprenticeships and academic credentials for the Community
Health Aide Program (CHAP), a national certificate program
offered through the Alaska Tribal Health System (ATHS).
Additionally, Dr. Hallock explained that APU partners with APCA
and ATHS to offer academic credit for industry-specific training
in health occupations, including community medical assistant,
electronic records, pharmacy technician, et cetera. She stated
the health occupations program is an example of APU's "creative
partnership[s]." After the completion of the apprenticeship
program, students then take the national exam. She stated that
APU appoints APCA instructors as adjunct faculty. She explained
that credits earned through the apprenticeship programs can be
applied towards undergraduate certificates in health occupations
and likened the process to "doing major requirements before
doing general education requirements." She explained that APU
originally aligned its apprenticeship programs with
[traditional] academic terms; however, in order to meet the
demand for APCA's health centers, APU had adjusted its
enrollment strategy to enroll students at a faster pace.
DR. HALLOCK concluded by listing some unique principles of APU:
stackable degrees with no loss of credit for students; the
establishment of authentic community partnerships; and credits
for competency-based learning.
3:54:18 PM
CO-CHAIR FIELDS thanked the invited testifiers for their
presentation.
HB 80-RESIDENTIAL BUILDING CODE
3:54:32 PM
CO-CHAIR FIELDS announced that the next order of business would
be HOUSE BILL NO. 80, "An Act relating to minimum standards for
residential buildings; relating to construction contractors and
residential contractor endorsements; establishing the Alaska
State Residential Building Safety Council; and providing for an
effective date."
CO-CHAIR FIELDS noted that HB 80 was a request from the Alaska
State Home Building Association (ASHBA).
3:55:00 PM
CO-CHAIR FIELDS opened public testimony on HB 80.
3:55:20 PM
AARON WELTERLEN, Vice President, Interior Alaska Building
Association, Alaska State Home Building Association, testified
in support in HB 80. He explained that building a "code-minimum
house" is the "bare bones standard" and further emphasized that
many builders build far beyond that [standard]. He stated that
HB 80 would create consumer protection and provide for legal
pathways were a building not constructed to a minimum standard.
He reiterated that ASHBA would like to see HB 80 move forward.
3:56:26 PM
CO-CHAIR FIELDS thanked Mr. Welterlen for his work on expanding
affordable housing opportunities in Interior Alaska. Further,
he asked about lifecycle savings from building well-insulated
homes, given the rising costs of heating in Alaska.
3:56:43 PM
MR. WELTERLEN responded that lifecycle is dependent on the use
of the house. He further stated that energy use decreases
through installation of more energy-efficient features, thereby
extending the lifecycle and creating a healthy house. He noted
that HB 80 pertains to structural standards, not energy
[standards].
3:57:27 PM
DAVID MILLER, Past President, Board of Directors, Mat-Su Home
Builders Association (MSHBA), testified during the hearing on HB
80. He stated that he is a lifelong builder of 34 years. He
noted that Alaska currently has adopted a standard of building
codes through the Alaska Housing Finance Corporation (AHFC), by
which the majority of builders in the state abide. He
recognized that, occasionally, some do not build to AHFC's
standard and remarked that it is a concern to all builders.
MR. MILLER stated that the majority of MSHBA opposes HB 80 in
its current form. He asserted that, when builders follow a high
standard, it drives competition that creates an environment of
high-quality construction. He remarked that his organization
does not see lack of standards as an issue and offered his
belief that the Matanuska-Susitna ("Mat-Su") Valley would be
most affected by HB 80. He said that the Matanuska-Susitna
Borough is the fastest growing area in the state. He clarified
his belief that a building code is important but opined that [HB
80] may be premature. He stated that MSHBA adopted AHFC's
building codes [in 2024].
MR. MILLER emphasized the importance of preventing housing costs
from increasing with the administration of HB 80. Additionally,
he shared his concern that there are no provisions in the
current legislation to prevent permitting processes from being
protracted. Nonetheless, he stated that he would support the
proposed legislation in its current form.
4:01:17 PM
CO-CHAIR FIELDS asked Mr. Miller to clarify whether he was in
support of the proposed legislation.
MR. MILLER responded that, were HB 80 to be adopted at the
statewide level, it would eventually necessitate enforcement.
He asserted that the process of enforcement should be
facilitated by local governments.
4:02:10 PM
REPRESENTATIVE COULOMBE noted that Mat-Su is the fastest growing
region in Alaska. She queried the relationship between the pace
of homebuilding and building codes.
4:02:32 PM
MR. MILLER responded that they are not directly linked. He
provided an anecdote about homebuilding in Chugiak. He stated
that his company began construction the prior summer [2024], but
the project was stalled over the winter due to the time it took
to acquire materials necessitated by the Municipality of
Anchorage (MOA).
4:03:57 PM
LEAH WINTERS, Public Policy Fellow, Cold Climate Housing
Research Center, testified in support of HB 80. She reported
that she had been researching building codes in collaboration
with AHFC. She explained that Alaska currently has a patchwork
of local regulations. She argued that communities that have
adopted residential codes have adopted national standards that
are not suitable for Alaska's climate. Additionally, she stated
that local code adoption is expensive and time-consuming for
local governments. Further, she stated that it creates
inconsistencies across regions, making it more difficult for
contractors.
MS. WINTERS argued that HB 80 would create an "Alaska-specific"
starting point, from which local governments can adopt, amend,
and enforce regulations at a local level. She stated HB 80 is
designed to be flexible out of an understanding that the "one-
size-fits-all" approach does not work in Alaska communities.
She asserted that HB 80 creates a baseline that is tailored to
Alaska's conditions, therefore reducing the burden on local
governments.
MS. WINTERS stressed that HB 80 would not apply to owner
builders. She asserted that HB 80 would improve [building]
standards and consistencies while protecting the right to build
independently. She concluded by urging committee members to
support HB 80.
4:06:15 PM
REPRESENTATIVE SADDLER offered his understanding that HB 80
would require a minimum residential building code statewide, and
local governments could only exercise flexibility by making the
code stricter.
MS. WINTERS cited Colorado and Maine, which have allowed
exceptions and flexibilities for communities, typically remote,
that do not have the capacities or institutions to enforce a
statewide code. She offered her understanding that a statewide
residential building code is not inherently enforceable, and
that HB 80 would "set the baseline for the capability of local
adoption." She further echoed another speaker in stating that
local jurisdictions could adopt a code stricter than the
provisions under the proposed legislation.
REPRESENTATIVE SADDLER asked for clarification of Ms. Winters'
position on the proposed legislation.
MS. WINTERS responded that she is in support of HB 80,
particularly with the increase of natural disasters on the West
Coast. She noted that the Federal Emergency Management Agency
(FEMA) has research indicating that building codes save both
lives and money. Further, she remarked that Alaska is one of
few states lacking a statewide building code while being the
most seismically active.
REPRESENTATIVE SADDLER asked whether building codes save money
for the homebuyers or the homebuilders.
MS. WINTERS gave an anecdote about earthquakes, stating that,
when there is an earthquake, buildings that collapse must be
rebuilt. She asserted that money is saved by both the
homebuyers and the homebuilders when buildings are constructed
to withstand natural disasters, such as earthquakes.
4:09:30 PM
EDNA DEVRIES, Mayor, Matanuska-Susitna Borough, testified in
opposition to HB 80. She offered her agreement with Ms.
Winters' point on the "one-size-fits-all" approach not working
for Alaska but disagreed that the proposed legislation would
offer a solution. She asserted that HB 80 would remove local
control. She explained that the Matanuska-Susitna Borough has
limited government and is not typically receptive to state or
federal government overreach. She predicted that, were HB 80 to
pass, the borough would be required to construct a building
department. She stated that the [Mat-Su Borough] has very
qualified builders and financing agencies. In conclusion, Ms.
Devries shared her concern that the proposed legislation would
create an additional unnecessary layer of government.
4:11:33 PM
REPRESENTATIVE SADDLER asked whether the local governments in
the Matanuska-Susitna Borough currently have any local building
codes.
MS. DEVRIES answered that they have conditional use permits
regarding junk cars and marijuana shops and setbacks. She
explained that many subdivisions in the Mat-Su Borough have
homeowners' associations (HOAs) that enforce "covenants."
Additionally, she stated that if HB 80 were to pass, the Mat-Su
Borough would be required to set up a building department "as
large as Anchorage," given the size of the borough.
4:12:54 PM
CO-CHAIR FIELDS stated that HB 80, as currently drafted, would
not require the borough to construct a building department.
MS. DEVRIES acknowledged that the proposed legislation does not
currently require a building department. However, she argued,
the State of Alaska has historically put restrictions and
guidance upon local governments, like the school bond
reimbursement or the senior citizen exemption, that have fallen
to the [local] taxpayer.
4:14:02 PM
PETER MICCICHE, Mayor, Kenai Peninsula Borough (KPB) and former
legislator testified in opposition to HB 80. He stated that the
Kenai Peninsula Borough is the size of West Virgina. He stated
that, of his 61,000 constituents, approximately two-thirds live
in areas without local building codes. He asserted that people
are moving out of the cities in the Kenai Peninsula Borough to
areas without local building codes because of the cost of
building in cities.
MAYOR MICCICHE asserted that, through the creation of a mayor's
working group with inputs from citizens, state agencies,
builders, developers, and economists from the DOLWD, a statewide
building code would not address the "extreme lack of affordable
housing." He stated that the KPB is tackling the problem with
other solutions. He reported that the KPB is making borough
land available for construction. Additionally, he reported that
KPB worked with local homebuilders to create affordable housing
units that would not meet the code requirements of the proposed
legislation.
MAYOR MICCICHE asserted that there are "two Alaskas." He
maintained that the concrete foundation requirements discussed
in a previous hearing on HB 80 are non-existent in a large
portion of Alaska. He argued that the issues of insurability
and resale value are null during an unprecedented housing
shortage. He contended that middle- and low-income individuals
would have no housing under the additional constraints of the
proposed legislation. He spoke to local control, commenting
that cities have the right to institute building codes - some
cities in KPB have chosen to do so, but the borough itself has
not.
MAYOR MICCICHE offered some alternative suggestions for ensuring
that residential buildings are constructed to a high standard,
including utilizing a 5-star builders group and builder
warranties. He recognized the intent of the proposed
legislation but argued that it would not accomplish what it
intended. He shared that he strongly felt creating a [statewide
residential] building code during an unprecedented housing
shortage would create an additional barrier. He concluded by
urging committee members to consider alternative solutions for
low-cost quality housing.
4:20:28 PM
REPRESENTATIVE SADDLER asked if there have been any changes in
adoption or recension of building codes in Mayor Micciche's area
of governance.
MAYOR MICCICHE stated that the cities in KPB update their
building codes every two to three years and can opt out of
certain stipulations. He stated that people choose to live in
or outside of the cities based on what best suits them and
further stated that the cities have the infrastructure to
support building codes. He stated that outside of city limits,
individuals are not required to build to code. He emphasized
that rent has doubled in the last five years on the Kenai
Peninsula. He asserted that there is a demographic of people,
low- and middle-income, who are struggling to afford housing and
"every incremental cost that's added to unaffordable housing
pushed that build out another several years."
REPRESENTATIVE SADDLER queried about region-specific hazards
that building codes might address in KPB.
MAYOR MICCICHE responded that the biggest hazard to housing for
residents in KPB is lack of housing. He remarked that a
building code is the minimum expectation in the "right place
...for a certain demographic - the more traditional homebuyer."
He stated that a building code is a requirement for most
conventional loans and for AHFC. He noted that, due to the
extreme housing shortage, there are people building yurts,
cabins, and nonconventional housing as primary residences. He
stated that KPB provides local option zoning districts (LOZDs).
Finally, he commented that, of the 61,000 residents in KPB,
41,000 residents have opted to live outside of zoning districts.
4:24:56 PM
DEAN BARTSCH, representing self, testified in opposition to HB
80. He said that he is a "substandard" builder. He stated that
the legislature does not have the authority to dictate how he
builds his house. He asserted that a uniform building code from
rainforest to permafrost is impossible. He argued that licensed
contractors would be prohibited from repairing his house,
because it is not built to code. He provided a personal
anecdote to illustrate that systems not built to code could
outlast systems that are built to code.
4:29:26 PM
CO-CHAIR FIELDS stated that HB 80 was the result of requests
from homebuilders.
CO-CHAIR FIELDS, after ascertaining that there was no one else
who wished to testify, closed public testimony on HB 80.
4:30:03 PM
REPRESENTATIVE COULOMBE reiterated her concern that the proposed
legislation would increase both the cost and red tape regarding
housing. She stated that the Anchorage Assembly passed an
ordinance last night [February 11, 2025], to halt design
standards for multi-family housing as part of the assembly's
"10,000 homes in 10 years strategy." She maintained that the
assembly is doing so to remove "cost-adding rules and the time
delay." She commented that "even Anchorage understands that ...
more rules and more codes ... will increase the cost of housing
and ... does increase delays."
[HB 80 was held over.]
HB 74-CRIME COUNTERFEIT/NONFUNCTIONING AIRBAG
4:30:49 PM
CO-CHAIR FIELDS announced that the final order of business would
be HOUSE BILL NO. 74, "An Act establishing the crime of airbag
fraud."
4:31:11 PM
The committee took an at-ease from 4:31 p.m. to 4:32 p.m.
4:32:34 PM
FRANK TOMASZEWSKI, Alaska State Representative, Alaska State
Legislature, as prime sponsor, presented HB 74. He explained
that HB 74 was brought to his attention by the Honda Motor Co.,
Inc. and the Automotive Anti-Counterfeiting Council (A2C2). He
stated that there are currently no laws in Alaska that prohibit
the installation or re-installation of airbags that do not meet
federal safety standards. He stated that counterfeit and non-
functioning airbags are known to improperly deploy, or not
deploy at all, which can result in serious injury or death. He
stated that HB 74 would establish the crime of airbag fraud and
prohibit dangerous actors from knowingly selling, installing, or
manufacturing counterfeit or non-functioning airbags. He
explained that a counterfeit airbag is defined as a replacement
airbag displaying an unauthorized mark that is similar to the
mark of the vehicle manufacturer [Honda, Toyota, Subaru]. A
non-functioning airbag is an inoperable or damaged airbag, or an
airbag that had been previously deployed or removed from a
vehicle due to unreasonable safety risks. He noted that
legislation similar to HB 74 has passed in 30 other states. He
stated that passage of HB 74 would align Alaska with the Federal
Administration's efforts to stop the importation of counterfeit
or non-functioning airbags through the Federal Trade Commission
Act (FTC Act). He stated that HB 74 would allow federal
authorities to seize counterfeit or non-functioning airbags at
Alaska's border. He stated that the Coalition Against Insurance
Fraud, which supports HB 74, believes that consumers should be
able to trust that their airbags will function.
REPRESENTATIVE TOMASZEWSKI asserted that Alaska has a
responsibility to protect its citizens from all counterfeit and
non-functioning airbags. He stated the HB 74 would provide
legal consequences for those who knowingly install counterfeit
or non-functional airbags. Further, he noted that, in the
proposed legislation, there are protections for third parties,
such as owners or dealerships, who unknowingly install or sell
counterfeit/non-functional airbags.
REPRESENTATIVE TOMASZEWSKI concluded with a personal anecdote,
stating that he was involved in a head-on collision three years
prior, where all airbags were properly deployed. He asked his
staff to continue with the sectional analysis of HB 74.
4:35:53 PM
DAVID GOFF, Staff, Representative Tomaszewski, Alaska State
Legislature, as staff to Representative Tomaszewski, prime
sponsor of HB 74, gave the sectional analysis of HB 74 [included
in the committee file], which read as follows [original
punctation provided]:
Section 1
Amends the airbag fraud statute (AS 28.35.248) by
establishing and defining airbag fraud as knowingly
selling, offering for sale, installing, reinstalling,
or manufacturing a counterfeit or nonfunctioning
airbag
or device that is intended to conceal a counterfeit or
nonfunctioning airbag, or intentionally selling,
leasing or trading a vehicle that the person knows has
a counterfeit or nonfunctioning airbag.
Establishes airbag fraud as a class A misdemeanor or a
class C felony if death or serious physical
injury to another person occurs as a result of the
counterfeit or nonfunctioning airbag.
Establishes that the liability of any party in a civil
action is not precluded. Provides that this
legislation does not create a duty to inspect a
vehicle for a counterfeit or nonfunctioning airbag
before its sale.
This section excludes a person installing,
reinstalling, or replacing an airbag on a vehicle used
solely for police work; an owner or employee of a
motor vehicle dealership or the owner of a
vehicle who does not have knowledge that the vehicle's
airbag is counterfeit or nonfunctioning; a
person who transfers a vehicle title to an insurance
company to satisfy an insurance claim; or an
insurance company that sells or otherwise disposes of
a vehicle as authorized by law or
regulation.
4:37:47 PM
REPRESENTATIVE SADDLER pondered on where the supply chain for
counterfeit/non-functional airbags existed. He asked if the
proposed legislation would have an effect on counterfeit/non-
functional airbag supply chains.
4:38:27 PM
REPRESENTATIVE TOMASZEWSKI responded that, to date, he is not
aware of any incidents in Alaska. He stated that he is
attempting to get ahead of the issue, reiterating that 30 other
states have already passed legislation regarding the issue. He
stated that counterfeits are circulating in the United States.
4:39:27 PM
REPRESENTATIVE COULOMBE asked about the penalties proposed under
HB 74.
4:39:53 PM
MR. GOFF responded that he would get back to the committee with
the information, but offered his belief that a felony [if death
or serious physical injury to another person occurs as a result
of the counterfeit or nonfunctioning airbag] would constitute up
to a $25,000 fine and up to one year in prison.
4:40:15 PM
CO-CHAIR HALL asked whether there was a black market or business
incentive for the manufacturing of counterfeit/non-functional
airbags.
4:40:51 PM
REPRESENTATIVE TOMASZEWSKI responded that airbags are an
expensive purchase that are required for vehicles. He stated
that an individual, in trying to cut costs, might go to an
unreputable supplier to replace the product.
4:41:46 PM
REPRESENTATIVE NELSON offered his appreciation for HB 74.
4:42:26 PM
CO-CHAIR FIELDS announced the committee would hear invited
testimony. He asked the invited testifier to clarify how
counterfeit/non-functional airbags might be installed in a
vehicle, i.e. whether it is typically an individual or third
party that installs the counterfeit/non-functional airbag.
4:42:59 PM
CRAIG ORLAN, Director of State and Local Government Affairs,
American Honda Motor Co., Inc., began invited testimony in
support of HB 74. He began his testimony by stating that
counterfeit or non-functioning airbags have been plaguing the
industry for over a decade. He clarified that counterfeit/non-
functional airbag installations are not a problem with
legitimate automotive supply chains. He explained that, after
an accident, a customer might go to an independent repair
facility for an airbag replacement and receive a
counterfeit/non-functional airbag installation. He reported
that there is a "handful" of "unscrupulous actors" installing
the counterfeit/non-functional airbags.
MR. ORLAN reported that faulty airbags have been filled with a
variety of debris, including sawdust, newspapers, rags, and
trash bags. He mentioned a shipment of counterfeits in Los
Angeles that required a bomb squad to detonate the airbags.
Additionally, he reported that a repair shop owner in Florida
was recently charged under a law similar to HB 74 for installing
over 300 counterfeit airbags in the vehicles of unsuspecting
customers.
MR. ORLAN explained that the majority of counterfeit/non-
functional airbags originate overseas and are imported into the
United States from China. He stated that agencies like the U.S.
Customs and Border Protection, the Federal Bureau of
Investigation (FBI), and the U.S. Department of Homeland
Security have limited authority and can pursue action only if
there is a violation under federal trademark or federal hazmat
law, which Mr. Orlan asserts, does not apply to the majority of
manufactured counterfeit/non-functional airbags. He asserted
that supplementing federal law with state law would allow state-
federal cooperation on prohibiting counterfeit/non-functional
airbags from entering the U.S. and allows e-commerce retailers
to delist products in a timely manner.
MR. ORLAN concluded by noting that the proposed legislation had
been drafted with inputs from numerous stakeholders including
automakers, dealers, repair professionals, insurance companies,
law enforcement agencies, and consumer groups. He further noted
that similar legislation has passed in 38 other states with
bipartisan support and no public opposition. He finished with
an anecdote regarding the underground market, reporting that
there was a man in North Carolina who made over $1.7 million in
a little over one year selling counterfeit airbags to
unsuspecting consumers. He further reported that the law in
North Carolina was used as leverage to identify victims and
remove the faulty airbags from their vehicles. He said that the
nature of an underground economy makes it difficult to fully
determine its size and scope. He reported that counterfeit/non-
functional airbags have been found in almost every state. He
thanked the committee members for their time and consideration.
4:46:32 PM
CO-CHAIR FIELDS stated that some e-commerce retailers, like
Amazon or eBay, have done little "due diligence" to protect
customers from purchasing faulty airbags.
MR. ORLAN responded that some e-commerce retailers are more
helpful than others. He stated that e-commerce retailers are
more responsive when it is in violation of state and federal
laws and a public safety risk. He asserted that his company has
seen e-commerce retailers become more responsive when laws like
HB 74 are passed.
4:47:13 PM
CO-CHAIR HALL asked what the purpose of counterfeit airbags.
MR. ORLAN responded that airbags can sell for hundreds to
thousands of dollars and replacements can be sold at a much
cheaper price. He stated the goal is to deceive the consumer,
bypass radiographs, and look more authentic. He additionally
stated that many faulty airbags are simply empty, or
nonfunctional, which is why the proposed legislation was written
to include nonfunctional airbags as an act of fraud.
CO-CHAIR HALL asked how much an airbag weighs and what contents
are typically inside an airbag.
MR. ORLAN replied that an airbag is a part of a supplemental
restraint system (SRS). He explained that when a vehicle is
involved in a collision, a sensor goes off to determine the
point of impact, which airbags to deploy, in what order, and
with how much force to provide maximum protection. He explained
that a collision would trigger a small explosion, filling the
functioning/non-counterfeit airbag with gas before deflation.
He stated an airbag is a cushion material, meant to protect the
passenger. He reiterated that some people are intentionally
filling airbags with debris or nothing at all.
[HB 74 was held over.]
4:50:23 PM
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
[4:50] p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 74 Version A.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB 74 Sponsor Statement.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB 74 Sectional Analysis.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB 74 Letter of Support - A2C2_Airbag-Support_AK-House.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB074-DOA-OPA-2-7-24.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB074-DOA-PDA-1-14-25.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB074-DOC-IDO-2-7-2025.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB074-DPS-AST-2-7-25.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB074-JUD-ACS-02-06-25.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB74-LAW-CJL-01-30-25.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB 80 Letter of Support - ICC Testimony in Support.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 80 |
| HB 74 Supporting Document - Deadly Counterfeit Air Bags Are Making Their Way Into Vehicles - WSJ.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |
| HB 74 Supporting Document - Alaska one pager.pdf |
HL&C 2/12/2025 3:15:00 PM |
HB 74 |