Legislature(1993 - 1994)
03/17/1994 08:00 AM House STA
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE STATE AFFAIRS STANDING COMMITTEE
March 17, 1994
8:00 a.m.
MEMBERS PRESENT
Representative Al Vezey, Chairman
Representative Pete Kott, Vice Chairman
Representative Bettye Davis
Representative Gary Davis
Representative Harley Olberg
Representative Jerry Sanders
Representative Fran Ulmer
MEMBERS ABSENT
None
COMMITTEE CALENDAR
*HB 491: "An Act relating to reports by the Alaska
Science and Technology Foundation."
MOVED OUT OF COMMITTEE WITH A DO PASS
RECOMMENDATION
HB 453: "An Act amending the motor fuel tax to
establish a different tax levy on residual
fuel oil used in and on watercraft; and
providing for an effective date."
MOVED OUT OF COMMITTEE WITH A DO PASS
RECOMMENDATION
*HB 430: "An Act requiring certain applicants for a
driver's license to take a driver training
course."
HELD IN COMMITTEE
HB 410: "An Act relating to real estate appraisers
and the Board of Certified Real Estate
Appraisers."
HELD IN COMMITTEE
(*First public hearing)
WITNESS REGISTER
REPRESENTATIVE GARY DAVIS
Alaska State Legislature
Alaska State Capitol, Room 420
Juneau, AK 99811-0460
Phone: 465-2693
POSITION STATEMENT: Prime sponsor of HB 453
REPRESENTATIVE JOE GREEN
Alaska State Legislature
Alaska State Capitol, Room 114
Juneau, AK 99811-0460
Phone: 465-4931
POSITION STATEMENT: Answered questions on CSHB 453 and
Sponsor of HB 430
ROBERT M. ERICKSON
Teamsters Local 959
306 Willoughby Ave.
Juneau, AK 99801
Phone: 586-3225
POSITION STATEMENT: Supported CSHB 453
BERNIE SMITH, Manager
Government Affairs
Tesoro Alaska
P.O. Box 3369
Kenai, AK 99611
Phone: 776-8191
POSITION STATEMENT: Supported CSHB 453
JAMES BURNS, Senior Vice President
Marketing, Petromarine Services
3111 C St., No. 500
Anchorage, AK 99504
Phone: 562-5000
POSITION STATEMENT: Commented on CSHB 453
C.J. ZANE, Director
Government & Community Relations
Holland America Lines
Westours, Inc.
880 H St., No. 200A
Anchorage, AK 99501
Phone: 274-9019
POSITION STATEMENT: Supported on CSHB 453
JUANITA HENSLEY, Chief of Driver Services
Department of Public Safety
P.O. Box 20020
Juneau, AK 99802
Phone: 465-2650
POSITION STATEMENT: Answered questions on HB 430
WENDY MULDER, Special Assistant
Department of Commerce & Economic Development
P.O. Box 110800
Juneau, AK 99811-0800
Phone: 465-2500
POSITION STATEMENT: Gave the sponsor statement for CSHB 410
ALFRED FERRARA, Chairman
Alaska Board of Real Estate Appraisers
1116 Shady Lane
Anchorage, AK 99516
Phone: 561-1031
POSITION STATEMENT: Supported CSHB 410
KARL LUCK, Director,
Occupational Licensing Division
Department of Commerce & Economic Development
P.O. Box 110806
Juneau, AK 99811-0806
Phone: 465-2534
POSITION STATEMENT: Gave a sectional analysis of CSHB 410
PREVIOUS ACTION
BILL: HB 491
SHORT TITLE: REPORTS BY SCIENCE & TECH FOUNDATION
SPONSOR(S): REPRESENTATIVE(S) VEZEY
JRN-DATE JRN-PG ACTION
02/14/94 2380 (H) READ THE FIRST TIME/REFERRAL(S)
02/14/94 2380 (H) STATE AFFAIRS
03/17/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 453
SHORT TITLE: TAX ON RESIDUAL MARINE FUEL OIL
SPONSOR(S): REPRESENTATIVE(S) G.DAVIS
JRN-DATE JRN-PG ACTION
02/09/94 2316 (H) READ THE FIRST TIME/REFERRAL(S)
02/09/94 2316 (H) L&C, STATE AFFAIRS, FINANCE
03/15/94 (H) L&C AT 03:00 PM CAPITOL 17
03/16/94 2850 (H) L&C RPT CS(L&C) NEW TITLE
4DP 1NR
03/16/94 2850 (H) DP:PORTER,HUDSON,WILLIAMS,
SITTON
03/16/94 2850 (H) NR:GREEN
03/16/94 2850 (H) -ZERO FISCAL NOTE (REV) 3/16/94
03/17/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 430
SHORT TITLE: LICENSING REQUIREMENTS FOR DRIVERS
SPONSOR(S): REPRESENTATIVE(S) GREEN,Foster
JRN-DATE JRN-PG ACTION
02/02/94 2220 (H) READ THE FIRST TIME/REFERRAL(S)
02/02/94 2220 (H) STATE AFFAIRS, FINANCE
03/03/94 (H) STA AT 08:00 AM CAPITOL 102
03/17/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 410
SHORT TITLE: REAL ESTATE APPRAISERS
SPONSOR(S): LABOR & COMMERCE BY REQUEST
JRN-DATE JRN-PG ACTION
01/28/94 2177 (H) READ THE FIRST TIME/REFERRAL(S)
01/28/94 2177 (H) L&C, STATE AFFAIRS, FINANCE
02/17/94 (H) L&C AT 03:00 PM CAPITOL 17
02/17/94 (H) MINUTE(L&C)
02/18/94 2453 (H) L&C RPT CS(L&C) 6DP
02/18/94 2454 (H) DP:HUDSON,PORTER,SITTON,MULDER
02/18/94 2454 (H) DP:WILLIAMS, GREEN
02/18/94 2454 (H) -ZERO FISCAL NOTE (DCED)
2/18/94
02/18/94 2454 (H) REFERRED TO STATE AFFAIRS
03/17/94 (H) STA AT 08:00 AM CAPITOL 102
ACTION NARRATIVE
TAPE 94-32, SIDE A
Number 000
CHAIRMAN AL VEZEY called the meeting to order at 8:01 a.m.
Members present were REPRESENTATIVES SANDERS, G. DAVIS,
OLBERG, and B. DAVIS. A quorum was present.
HB 491 - REPORTS BY SCIENCE & TECHNOLOGY FOUNDATION
CHAIRMAN VEZEY opened HB 491 for discussion. He stated HB
491 changes the reporting period from a calendar year to a
fiscal year. Currently, the Science & Technology Foundation
reports January 1-December 31; however, the report has to be
into the legislature by January 15. The calendar year does
not coincide with the fiscal year on which the Budget
Committee reviews their budget.
Number 041
REPRESENTATIVE BETTYE DAVIS moved to pass HB 491 out of
committee with individual recommendations and attached zero
fiscal note.
(REPRESENTATIVE KOTT joined the meeting at 8:03 a.m.)
Number 045
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES VEZEY, KOTT, B. DAVIS, G.
DAVIS, SANDERS, OLBERG.
ABSENT: REPRESENTATIVE ULMER
CHAIRMAN VEZEY announced HB 491 passed from the House State
Affairs Committee.
(REPRESENTATIVE ULMER joined the meeting at 8:04 a.m.)
CSHB 453, Version U: "An Act establishing, for purposes of
the levy and collection of the motor fuel tax and for a
limited period, a different tax levy on residual fuel oil
used in and on certain watercraft; and providing for an
effective date."
CHAIRMAN VEZEY opened CSHB 453 for discussion.
Number 090
REPRESENTATIVE GARY DAVIS, PRIME SPONSOR, addressed CSHB
453, version U. He stated CSHB 453 attempts to create an
equal playing between Alaska's residual fuel oil industry
and their counterparts in the Lower 48 and Canada. The
sponsor statement is as follows:
"Residual fuel oil is the residue from crude oil after the
light oils, gasoline, naphtha, kerosene, and mid-distillates
are extracted in the refining process. The only
applications for residual fuel oil in Alaska are asphalt,
cruise ship fuel and reinjection into the pipeline."
Alaska's motor fuel tax rate for residual fuel oil is five
cents per gallon.
"As a result of the current rate of taxation on this
product, Alaska's residual fuel oil is automatically
noncompetitive with the same product available elsewhere.
The cruise ship industry is the prime potential market for
this fuel oil. However, even though many ships cruise
Alaska waters during the summer, minimal quantities of this
extremely tax sensitive fuel oil are purchased in Alaska.
Consequently, the state receives minimal revenue from the
tax.
"House Bill 453 will reduce the tax rate levied on the sale
of residual fuel oil, which will stimulate sales of residual
fuel oil and benefit Alaska's economy. This legislation
will increase job opportunities in the trucking and fuel
industries. Simultaneously, state revenues will likely
remain consistent and possibly increase."
REPRESENTATIVE G. DAVIS commented, in the final report of
the Governor's Task Force on Regulation Review, it was
recommended that the marketing of "heavy bunker oil" be made
more economically competitive by eliminating or reducing the
taxes. He noted the cruise ship industry is growing every
year and all of the ships run on "bunker oil," which is a
blend of residual fuel and No. 2 diesel.
REPRESENTATIVE G. DAVIS stated Princess Tours has been
landing in Seward for quite a while; using only a bit of
residual loaded there for ballast only. They currently
purchase their fuel in Vancouver, Canada; however, they have
indicated, without guarantee, that they will purchase
adequate quantities to compensate for the revenue Alaska has
taken in on residual fuel over the past few years.
REPRESENTATIVE G. DAVIS mentioned the Tesoro refinery in
Kenai probably has upward of 200 million gallons of residual
fuel oil per year that they have to market. Without a local
market, they ship out from Cook Inlet to the West Coast and
the Far East. He believed 13+ million gallons could be sold
in Seward on the assurances from a few of the cruise lines
e.g., Princess Tours, Holland America, etc.
REPRESENTATIVE G. DAVIS stated last year, Alaska received
about $205,000 from residual taxes. The estimation of the
proposed sale of 13 million gallons would compensate for
this loss, plus each year they believe the sales will
increase. He noted in Sitka, with the pulp mill closing
down, they have tanks that can store the oil and keep it
heated. Sitka is also looking for commitments from the
cruise lines that fuel would be bought from there. All of
these results are predicated on the reduction of the fuel
tax.
REPRESENTATIVE G. DAVIS stated information in the packets
shows the increase in California's fuel taxes made their
markets plummet. Alaska had significant fuel sales before
the 5 cent tax, and after the tax the market plummeted just
as California did. He believed 15-20 jobs would arise from
CSHB 453. He also noted Alaskan fuel burns cleaner than
others.
CHAIRMAN VEZEY wanted to know why CSHB 453 was being limited
to passenger watercraft and he felt the definition of
residual fuel oil should be improved.
REPRESENTATIVE G. DAVIS responded last year Tesoro sold fuel
to Marathon to fuel Liquid Natural Gas (LNG) tankers, which
amounted to $300,000-$400,000 in tax dollars to the state.
He commented in order to make CSHB 453 revenue neutral and
improve revenues in the future, they believed they should
focus the bill on passenger ships.
REPRESENTATIVE G. DAVIS referred to the question of the
definition of residual fuel oil. The Labor & Commerce
Committee attempted to correct the definition of residual
fuel oil in their committee substitute, version U.
Number 290
CHAIRMAN VEZEY clarified residual fuel is a product that has
to be heated to reduce its viscosity and it is rated
kinematic units. He had believed reducing viscosity was the
result of an increase in kinematic units.
Number 300
REPRESENTATIVE JOE GREEN addressed CHAIRMAN VEZEY's
question. He stated the higher the kinematic viscosity, the
less likely the fluid is to flow. Conversely, the lower the
kinematic rate, the less viscous the fuel becomes.
CHAIRMAN VEZEY commented, to avoid future disputes, a trade
standard for the fuel should be mentioned in CSHB 453.
REPRESENTATIVE HARLEY OLBERG believed the notation of No. 6
fuel oil was specific.
CHAIRMAN VEZEY replied No. 6 fuel oil would probably
describe 100 different fuels. He felt the No. 6 fuel oil
could be stated as rated by "API" to close the loophole.
Number 325
REPRESENTATIVE G. DAVIS interjected that JAMES BURNS was on
teleconference and he might be able to answer those
questions in his testimony.
Number 334
ROBERT M. ERICKSON, TEAMSTERS LOCAL 959, supported CSHB 453.
He stated CSHB 453 was an attempt to attract new businesses
into the state. Teamsters Local 959 has a collective
bargaining agreement with Weaver Brothers, who presently
hauls fuel from Nikiski to Seward using four tankers and
four drivers, during the tourist season. Weaver Brothers
has notified him that if CSHB 453 were to materialize like
it should, they would employ up to 12-14 more people to haul
the fuel back and forth. Both Nikiski and Seward would have
one-two more people working at the plants. He emphasized
the unemployment rate in the Kenai Peninsula has been for
quite some time the highest in the state of Alaska.
Number 363
CHAIRMAN VEZEY moved to the Kenai teleconference site.
Number 370
BERNIE SMITH, MANAGER, GOVERNMENT AFFAIRS, TESORO ALASKA,
supported CSHB 453. He referred to CHAIRMAN VEZEY's
previous question about why CSHB 453 focuses on passenger
watercraft and responded, in 1993, Tesoro paid $450,000 in
state taxes on bunker fuel. He noted if Tesoro had to sell
51-55 million gallons more of bunker fuel, CSHB 453 would
not be revenue neutral.
MR. SMITH stated both the Kenai and Soldotna Chambers of
Commerce have passed resolutions supporting CSHB 453.
Number 396
CHAIRMAN VEZEY reiterated there were indications that 13
million gallons of Tesoro's fuel would be purchased if CSHB
453 were to pass. He estimated this to equal 1300+
truckloads. He noted currently 200 million gallons of
bunker fuel is produced on the Kenai Peninsula and it is
exported to foreign markets to dispose of it at a loss. He
asked if was correct.
Number 406
MR. SMITH responded over 6.5 million barrels of residual oil
was produced in 1993, equivalent to nearly 200 million
gallons. The oil is distributed to the West Coast
refineries that can better process the fuel and then it is
shipped overseas. This oil is shipped at a substantial
reduction of what was originally paid for the crude oil.
Number 421
CHAIRMAN VEZEY moved to the Anchorage teleconference site.
Number 430
JAMES BURNS, SENIOR VICE PRESIDENT OF MARKETING, PETROMARINE
SERVICES, commented on CSHB 453. He stated Seward is set up
to "in-line blend" the product transferred over from Kenai.
The process of loading and storing the fuel, because it must
be heated, is complicated. In 1993, about 4 million
gallons were sold and $205,000 was paid in residual fuel
tax. If CSHB 453 were to achieve its objective by selling
13 million gallons, the state treasury would receive an
additional $30,000 above the $205,000 they paid last year.
If Seward were developed to be the choice bunker port for
the cruise industry the potential sale of fuel increases to
around 22 million gallons. The state treasury would then
receive an additional $260,000 above the current $205,000.
If Tesoro were to sell 13 million gallons in the summer of
1994, they would employ four dock workers, one supervisor
and eight truck drivers. He believed Weaver Brothers would
have to purchase three additional tankers.
MR. BURNS noted residual fuel is not taxed by any other
state in the Union. Canada does have a sales tax, however,
their price is still comparable with Seattle. Tesoro,
therefore, has to compete with the entire West Coast. In
his negotiations, he has been assured that if Tesoro were to
lower their prices closer to the others, the cruise lines
would be very interested in having Seward as their bunker
port, as opposed to Vancouver.
Number 484
CHAIRMAN VEZEY asked to have the definition of residual fuel
oil clarified.
Number 486
MR. BURNS answered CSHB 453 was written to cover any
situation where residual fuel is blended with another
product, typically No. 2 Diesel. He had requested the use
of the "No. 6 fuel oil" and "kinematic viscosity" as
terminology in CSHB 453. Blended residual fuel is sold by
the kinematic number. The fuel is labeled "Intermediate
Fuel Oil" and it is given a number such as 100, 180, 380,
and 420. He noted, however, the names for fuel differ
internationally with varied definitions.
MR. BURNS stated the importance was to not allow the tax
reduction to No. 2 diesel. By definition No. 2 diesel has a
viscosity no greater than 4.1. He emphasized if even a
small portion of residual fuel was mixed with No. 2 diesel,
the viscosity would rate 6 or greater. Therefore, the
definition in CSHB 453 would in no way qualify No. 2 diesel
for the tax break.
Number 513
CHAIRMAN VEZEY asked what unit of viscosity MR. BURNS meant
when he mentioned 4 and 6.
MR. BURNS answered 4 and 6 refer to the number of
centistokes. The higher the centistoke, the more fluid the
product. He gave the example that a 380 centistoke product
would take 380 seconds to fall through whatever device it is
being read in. Temperature is also a factor. He noted 180-
420 material is very thick and viscous, therefore it must be
kept warm in order to flow.
Number 526
CHAIRMAN VEZEY stated he had wanted to refer to a
professional organization for a standard of quality control
for fuel oils. For example, API or ASTM.
Number 536
MR. BURNS responded there are three international standards,
International Council of Combustion Engines, The British
Standard Institute and The International Standards
Organization (ISO).
Number 539
CHAIRMAN VEZEY stated he was very familiar with ISO and
asked about their standard for No. 6 fuel oil.
MR. BURNS answered they refer to it as Fuel Oil Grade No. 6.
He noted the problem is, on the international level, marine
fuels are also heavy oils. There is a marine fuel grade,
title DMV, that has a viscosity at a maximum of 11. The
grades decrease from 11. He was concerned that narrowing
the definition to ISO standards would focus on kinematic
viscosity, thereby becoming too complicated.
Number 553
C.J. ZANE, DIRECTOR, GOVERNMENT & COMMUNITY RELATIONS,
HOLLAND AMERICA LINE/WESTOURS INC., supported CSHB 453. He
stated Holland America contributes close to $600 million per
year to Alaska's economy in goods and services, and they
would like to increase this amount with the purchase of
fuel.
MR. ZANE stated in 1994, Holland America will operate five
large modern cruise ships in Alaska, increasing to six ships
in 1995. Their total demand for residual fuel in 1994 will
be nearly 57,000 metric tons or just over 15 million
gallons. This amount will increase in 1995 to 68,000 metric
tons or 18+ million gallons.
MR. ZANE noted Holland America has to take in other
considerations when determining which bunker port to use.
For one of their ships to take on a load of bunker fuel it
takes 8-10 hours, therefore, they need to know how long they
can be in port. If they cannot be in port long enough, they
would need to adjust their cruise itineraries. They were
also concerned about guaranteed supply. He mentioned Sitka
might also be a possible stop, besides Seward.
MR. ZANE emphasized the reduction in the residual sales tax
he was sure would increase both the demand and the purchases
of fuel.
(REPRESENTATIVE SANDERS left the meeting at 8:32 a.m.)
Number 617
CHAIRMAN VEZEY asked the pleasure of the committee.
Number 626
REPRESENTATIVE OLBERG moved to pass CSHB 453 with individual
recommendations and the accompanying fiscal note.
Number 628
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES OLBERG, G. DAVIS, B. DAVIS,
ULMER, KOTT, VEZEY.
CHAIRMAN VEZEY announced CSHB 453 passed from the House
State Affairs Committee.
CHAIRMAN VEZEY called for a recess at 8:42 a.m.
HB 430 - LICENSING REQUIREMENTS FOR DRIVERS
TAPE 94-32, SIDE B
Number 000
CHAIRMAN VEZEY called the meeting back to order at 8:50 a.m.
Members present were REPRESENTATIVES B. DAVIS and G. DAVIS.
CHAIRMAN VEZEY opened HB 430 for discussion.
Number 008
REPRESENTATIVE JOE GREEN, SPONSOR OF HB 430, gave a brief
statement. He stated the 18th Alaska Legislature works
toward providing future jobs for young individuals; however,
many teenagers will not reach those jobs because of "the
carnage that happens on our highways."
(REPRESENTATIVE OLBERG rejoined the meeting at 9:52 a.m.)
REPRESENTATIVE GREEN stated he was concerned not because
teenagers do not have the reflexes or coordination for
driving, but because they lack the maturity to realize that
a vehicle is a lethal weapon. HB 430 is an attempt to
reduce automobile accidents that are primarily caused by
people who either have a disregard for existing laws or have
a feeling of indestructibility.
REPRESENTATIVE GREEN outlined HB 430 breaks into categories
14-16, 16-18, and 18-21, a system of provisional licensing
which allows young people to learn to drive as long as they
are accompanied by a licensed driver, 25 years or older.
The 16-18 period is an instructional permit period, whereby
they can drive by themselves. The 18-21 period is a
provision of license. All of the stages are tied to a
penalty for abuse.
(REPRESENTATIVE ULMER and KOTT rejoined the meeting at 9:54
a.m.)
REPRESENTATIVE GREEN continued HB 430 contains provisions to
restrict young drivers to not driving during the most
accident prone hours, 1 a.m. to 5 a.m. Our current point
system, which states an individual is subject to license
revocation above 12 points, has been dropped in half to 6
points for the provisional drivers. He directed the
committee to the information in their packets, which states
the people who are more prone to accidents are between the
ages of 13-21.
REPRESENTATIVE GREEN mentioned there is a Federal High Risk
Drivers Act (FHRDA) expected to pass, and this should give
Alaska incentive to pass HB 430 because it may include many
similar provisions.
Number 122
JUANITA HENSLEY, CHIEF OF DRIVER SERVICES, DEPARTMENT OF
PUBLIC SAFETY (DPS), outlined HB 430. She stated HB 430
would place Alaska into a "graduated license system."
Statistics show the crash rates, injuries and fatalities
drastically increase between the hours of 9 p.m. and 6 a.m.,
especially among male drivers. The FHRDA was proposed to
reduce the carnage on the highways, and she noted it is not
a mandate for the states. The FHRDA offers incentives
whereby, if the state meets certain criteria, they can apply
for grants for the implementation of a program such as HB
430. DPS did not expect HB 430 would have any fiscal impact
on Alaska, because if it were to pass, Congress already has
incentive moneys in front of it to take care of the
implementation.
Number 171
REPRESENTATIVE FRAN ULMER asked the status of the money
Congress had available to it. Was it pending?
MS. HENSLEY answered Congress has the FHRDA before it now;
however, there are other grants available which the state
could apply for now to implement a program. She mentioned
Section 410 grants which the Highway Safety Planning Agency
currently receives for alcohol programs. The graduated
licensing system would fall under the 410 grant money
because it places teen-age drivers in a .00 based alcohol
program. Section 402 grant moneys for highway safety
programs, which graduated licensing would also fall under.
The FHRDA would create additional moneys the state could
apply for to implement further driver education.
MS. HENSLEY said that Alaska already has a demerit point
system in statute for drivers. If the DPS came across a
habitual reckless driver, they could request the driver to
come in for a driver improvement interview and place certain
requirements upon that person. The driver could be required
to attend an alcohol information school, a defensive driving
course, or watch eight hours of accident films. She noted
the state could apply for extra money to go towards buying
films to supply the operators of driving schools and
defensive driving courses in the state.
Number 221
REPRESENTATIVE G. DAVIS asked if a 16-year-old individual
would receive a provisional driver's license.
Number 226
MS. HENSLEY answered if a person is between 16-18 years old
they can receive a provisional driver's license, providing
they have held a six month instruction permit.
Number 231
REPRESENTATIVE G. DAVIS inquired if the provisional license
applied to the restrictive hours, or if they too always had
to be accompanied by an adult.
Number 234
MS. HENSLEY replied between the ages of 14-16, a licensed
driver 25 years or older, would have to accompany the permit
driver. Between the ages of 16-18 with a provisional
license, a driver would not have to be present.
Number 244
REPRESENTATIVE B. DAVIS asked how many states had
implemented a program like HB 430.
Number 247
MS. HENSLEY directed the committee to the "Young Driver
Laws" portion of their packets, for specific documentation
on each state's laws. She noted both Oregon and California
have an effective provisional license program with nighttime
driving restrictions. Their programs have proven to reduce
crashes between the ages of 16-19.
Number 267
REPRESENTATIVE B. DAVIS clarified the only change in the
provisional license status for teenagers would be that they
could not drive their cars between 1 a.m. and 5 a.m.
Number 270
MS. HENSLEY affirmed REPRESENTATIVE B. DAVIS, and added if
they are violating traffic laws they would lose their
license after a six point violation.
Number 276
REPRESENTATIVE B. DAVIS continued in order to get the
provisional license they must first hold an instructional
license. Current law allows an individual to just take a
test. She asked if a person, regardless of age, would have
to first have an instructional permit.
Number 281
MS. HENSLEY stated REPRESENTATIVE B. DAVIS was correct.
Number 283
REPRESENTATIVE GREEN mentioned if a person had a license
from another state with a comparable program, then they
would not have to revert back to an instructional license.
Number 286
REPRESENTATIVE B. DAVIS clarified everyone in the state
would have to have some form of instructional permit for six
months.
Number 298
REPRESENTATIVE PETE KOTT asked where the statistics were
drawn from in reference to the hourly restrictions on night
driving. What is the basis they gauge upon to determine the
times a teenager should not be on the rode.
Number 306
MS. HENSLEY answered the hourly restrictions are a
nationwide trend and Alaska's youth are the same as those in
the Lower 48. She noted there is a substantial number of
individuals who have had their license suspended each year
because of an accumulation of points gained during these
hours. She offered to research the number of crashes,
injury accidents and fatalities, involving the 14-21 age
group. She would also look up the societal cost to Alaska.
Number 322
REPRESENTATIVE KOTT asked who the hour restrictions would
apply to.
Number 326
MS. HENSLEY replied hour restrictions apply to those
individuals who are ages 14-17.
Number 329
REPRESENTATIVE KOTT questioned how the restriction would
affect a 16-year-old individual working at McDonald's that
did not get off work until 1:30 a.m.
MS. HENSLEY responded that person would be in violation of a
curfew. The restriction from 1 a.m. to 5 a.m. was imposed
because most businesses close at midnight and the extra one
hour would allow an individual to get home.
Number 338
REPRESENTATIVE KOTT mentioned delivery services for various
restaurants as examples. He asked if other states imposed
restrictions because of daylight hours, noting that
Fairbanks in the summer, would not have that problem.
Number 346
MS. HENSLEY answered the restrictions are not based on
daylight hours, but driving habits between the hours of 9
p.m. and 6 a.m. Between these hours, teenage driving habits
are more reckless and they are involved in more injury and
fatal accidents, as compared to the 30-50 year old age
group. She noted Illinois restricts from 11 p.m. to 6 a.m.,
Sunday through Thursday, and 12 a.m. to 6 a.m., Saturday and
Sunday. She preferred a consistent seven-day-a-week program
to cut down on the hassle for those people trying to enforce
the law. She stated several more examples with night hour
restrictions.
Number 373
REPRESENTATIVE KOTT stated he would like to see the
comparison chart for the age groups and their accident
rates. He asked if not accepting an individual's license
from another state, knowing that a test had been taken to
obtain it, would be compromising constitutionally.
MS. HENSLEY answered the testing requirement for those
individuals with a valid license from another state is
waived. Alaska statute, however, gives DPS the discretion
to issue every person a driving test if they choose. As
long as everyone in the same age bracket is treated the same
it is not unconstitutional.
Number 401
REPRESENTATIVE KOTT clarified he was referring to the
requirement for a one-year instructional permit, noting
several states do not have it. He felt those individuals
could complete requirements for a driver's license with two
months worth of a permit.
Number 411
MS. HENSLEY replied the state of Kansas issues a driver's
license at the age of 14 and Alaska does not honor it
because Alaska statute states a person cannot be licensed
until they are 16. Therefore, a 14-year-old individual from
Kansas with a valid driver's license could not receive an
Alaska driver's license until they reached the age of 16.
Number 417
REPRESENTATIVE GREEN clarified the restriction was added not
to test the technical ability to drive, but the maturity of
the driver. The restrictive hours are meant to reduce the
problem Alaska faces with carnage on the highways. He
mentioned the problem of young individuals who work late,
noting the percentage would be rather low and that laws are
made to address the majority.
Number 431
REPRESENTATIVE KOTT felt there was a correlation between
technical ability and ability. He noticed HB 430 increases
the age of the person who must accompany the driver from 19
to 25. Why not a parent?
Number 440
MS. HENSLEY responded REPRESENTATIVE KOTT's suggestion was a
legislative call. The state of Oregon, for example, is set
at 21 for the accompanying driver. She did not see a
problem with working on the age of the person who must
accompany the driver.
Number 447
REPRESENTATIVE GREEN stated insurance companies drop their
rates at the age of 25 because of the degree of maturity a
driver is supposed to have gained by that age. He noted
young drivers do have the benefit of faster reflexes;
however, maturity gained with age, hopefully outweighs what
is lost in reflexes.
Number 472
CHAIRMAN VEZEY asked if the statistics regarding the
increase in responsibility were the same for both males and
females.
REPRESENTATIVE GREEN answered, from his knowledge, they are.
Number 474
REPRESENTATIVE G. DAVIS referred to the restricted hours of
driving from 1 a.m. to 5 a.m. This restriction was of
concern to him because cannery workers tend to work 24 hours
a day when the fish are coming in. He noted there are
hundreds of workers starting at the age of 16, and they may
be restricted from doing some of their normal activities
such as going to a minimarket 1-2 miles from the cannery.
He emphasized the canneries are only open in the summer
months, there is a lot of daylight, and they do not drink
during this time. In relation to the young workers at
McDonalds, he felt the schedules could be shifted to
accommodate them so they could make it home before 1 a.m.
Number 507
REPRESENTATIVE ULMER directed the committee to packet
information entitled "Young Driver's Law", state law facts
of 1993. She noticed many states require a blood alcohol
content of .00 or .02 for drivers. She asked if HB 430
might be the appropriate vehicle to add this requirement to
state law.
MS. HENSLEY replied HB 299, sponsored by REPRESENTATIVE
CYNTHIA TOOHEY, has been introduced this session which
requires .00 based drug and alcohol driving for anyone under
the age of 21. HB 299 is now in House Finance.
Number 524
REPRESENTATIVE KOTT added HB 299 relates to everyone in the
vehicle, whether they are driving or not.
Number 527
CHAIRMAN VEZEY stated he would like a teleconference on HB
430 and it would be rescheduled.
Number 531
REPRESENTATIVE B. DAVIS agreed with CHAIRMAN VEZEY. She
mentioned the instance of two 17-year-old people married
with a child. She wondered how the situation would be
handled if the child got sick during the restricted hours
and needed to be taken to the hospital in a vehicle. Would
the restriction apply to the 17-year-old parents.
MS. HENSLEY answered marriage is emancipation which would
automatically make them adults.
Number 543
CHAIRMAN VEZEY announced HB 430 would be held in committee
to be rescheduled.
HB 410 - REAL ESTATE APPRAISERS
CHAIRMAN VEZEY opened CSHB 410, sponsored by the House Labor
& Commerce Committee, for discussion.
Number 556
WENDY MULDER, SPECIAL ASSISTANT, DEPARTMENT OF COMMERCE &
ECONOMIC DEVELOPMENT (CED), addressed CSHB 410. She stated
CED had asked the House Labor & Commerce Committee to
introduce HB 410 because they realized they had a problem
which would soon affect many Alaskans. The sponsor
statement read as follows:
"The U.S. statutes enacted the Financial Institutions
Reform, Recovery and Enforcement Act of 1989 (FIRREA). This
act requires federal lending programs to have the appraisal
certified by a state-certified appraiser.
"Initially, FIRREA set the number of classroom instruction
hours required for residential appraisers at 75. In 1990,
the Alaska Legislature enacted legislation which complied
with FIRREA standards. However, in 1992 FIRREA increased
the minimum required classroom hours to 105. Again in 1994,
they increased the minimum number of hours to 120.
"Officials from the Federal Financial Institutions
Examinations Council (FFIEC) audited the Alaska certifying
program. They granted the Alaska board an extension to meet
the new requirements through December 31, 1993.
"The FFIEC has advised that appraisers who do not meet 120
hours of training, will no longer be recognized as certified
appraisers and therefore, will not be qualified to conduct
appraisals in which federally-financed loans are involved.
"Examples of federally-financed programs include such
programs as Federal National Mortgage Corporation, and the
Resolution Trust Corporation. These requirements may extend
to loans provided through FDIC-insured banks and credit
unions.
"Currently, there are 73 residential real estate appraisers
and 73 general real estate appraisers licensed by the Alaska
Real Estate Appraiser Board. The general real estate
appraisers do meet FIRREA requirements and are recognized
for federal appraisals; however, general real estate
appraisers work with commercial properties and it is very
unlikely that they will begin conducting residential
appraisals. The 73 residential appraisers are no longer in
compliance with FIRREA and may not be recognized as
certified appraisers if the FFIEC removes Alaska's
certification.
"There were approximately 12,000 residential loan closures
this past year in Alaska (this figure includes refinancing).
It is unclear how many of these loans involve federal
financing, however, it is highly probably that the vast
majority of loans in Alaska do involve a federal program and
it will only take a few loans in this category to create a
statewide crisis.
"The proposed changes in HB 410 will remove the reference to
a specific number of hours required for certification in the
statute and will allow the board to set the minimum
requirements in regulation. By allowing the minimum number
of hours to be set in regulation, the Alaska Real Estate
Appraiser Board will be able to make changes as they occur
to meet the FIRREA requirements."
MS. MULDER commented the House Labor & Commerce committee
had concerns expressed to them by the banking industry that
the board would not set the requirements to exceed the
federal requirements. Therefore, HB 410 was changed on line
12, page 1, by adding language which states "to comply with,
but not exceed." They also decided to grant the extension
to the board, rather than having to do it again in 1995.
(REPRESENTATIVE SANDERS rejoined the meeting at 9:28 a.m.)
Number 619
CHAIRMAN VEZEY moved to the Anchorage teleconference site.
Number 621
ALFRED FERRARA, CHAIRMAN, ALASKA BOARD OF CERTIFIED REAL
ESTATE APPRAISERS, supported CSHB 410. He stated the
problem they face is that Alaska, unlike other states, has
put in statute the hours required. CSHB 410 would basically
give the board the right to meet the hours as they change on
a national level. He emphasized the hours will continue to
change because the federal law came in at minimal levels in
order to meet the requirements of most states and not
deprive individuals of their livelihood.
MR. FERRARA stated the FIRREA has been broadened to cover
any bank or credit union loan, therefore, nothing would be
financed by any lending institution unless they have a
certified appraiser perform the appraiser reports. Agencies
such as the Federal Highway Administration are now requiring
work be done by certified appraisers. He noted most active
appraisers are certified in Alaska because of this trend.
Number 653
REPRESENTATIVE ULMER moved to pass CSHB 410 from committee
with individual recommendations.
Number 655
CHAIRMAN VEZEY asked REPRESENTATIVE ULMER to hold her motion
in order to hear from another witness. He asked MS. MULDER
to outline the sections of CSHB 410 for the committee. He
stated section 1 extends the board for four more years, and
asked about section 2.
Number 668
MS. MULDER responded section 2 amends the powers and duties
of the board to clarify authority to adopt regulations
necessary to comply with FIRREA. She deferred the rest of
the sectional analysis to KARL LUCK.
Number 672
KARL LUCK, DIRECTOR OF OCCUPATIONAL LICENSING, DEPARTMENT OF
COMMERCE & ECONOMIC DEVELOPMENT, gave a sectional analysis
of CSHB 410. He said Section 2 gives authority to the board
to set the education hour requirement and directs them to
not exceed the FIRREA requirement. Section 3 repeals the
specific number of classroom hours in each category, thereby
requiring the board to put the requirements into
regulations. He stated section 3 referred to the general
real estate appraisers and section 4 referred to the
residential real estate appraisers.
TAPE 94-33, SIDE A
Number 000
MR. LUCK continued. Section 5 is the continuing education
requirement for renewal of certification for both general
and residential. Section 6 refers to the registration of
trainees and places them subject to the hours set forth by
the board.
MR. LUCK felt CSHB 410 was "straightforward" and the
statutory requirement should be placed back into regulation
to enable the board to maintain the federal requirement.
Number 027
CHAIRMAN VEZEY asked if the current requirement for 150 or
more hours of classroom instruction is greater than the
federal requirement.
MR. LUCK answered the General Real Estate Appraiser
certificate program meets the federal requirement; however,
he would have to research to find out what the general
requirement is. If the general requirement did exceed the
federal requirement, the board would be required to reduce
it. He emphasized the intent of CSHB 410 is to "ratchet up"
the requirements so over a period of time they would be much
higher than the original FIRREA. He did not know what the
federal intent would be in the future in regards to the
general real estate appraisers, whether or not they would
raise the requirements.
Number 059
CHAIRMAN VEZEY commented Alaska currently has a stricter
licensing requirement for general real estate appraisers
than it does for residential real estate appraisers. He
mentioned MAI and asked if it was a form of state licensing
or national recognition. Would CSHB 410 produce one
category of licensing from the present two.
Number 075
MR. LUCK replied he was not familiar with MAI. He answered
there would still be general and residential licensing.
Only the education requirements would be changed with CSHB
410.
Number 082
CHAIRMAN VEZEY inquired how many hours were currently
required for general real estate appraisal.
MR. LUCK responded 150 classroom hours, of which 15 hours
are in a specific area.
Number 088
REPRESENTATIVE OLBERG cited the sponsor statement that the
FIRREA requirement for a general real estate appraisal is
120 hours as of 1994. He noticed the statement references
the Alaska Legislature complying with FIRREA standards, but
he believed they exceeded them.
Number 101
CHAIRMAN VEZEY commented CSHB 410 did not seem to be
amending the statute for residential real estate appraisers.
Number 106
MR. LUCK directed the committee to section 4, which states
the board shall issue a residential real estate appraisal
certificate. Line 30, page 2, amends the residential
section. Section 3 specifically addresses the general real
estate appraisal certificate.
Number 113
CHAIRMAN VEZEY clarified CSHB 410 provides a less stringent
requirement on the general real estate appraisal and a more
stringent requirement on the residential real estate
appraisal.
Number 115
MR. LUCK added "than current requirement." He deferred to
ALFRED FERRARA to confirm his statement.
MR. FERRARA commented the federal requirement for the
general appraisal license is 150 hours, plus 15 hours of a
standards course. The residential requirement is 120 hours,
plus a standards course. He clarified Alaska does comply
with the federal standards. Alaska is not above the
federal minimum on a general appraiser, but it is below the
minimum on the residential. CSHB 410 would enable the board
to meet both of the federal sections. Residential, not
general would have to change. He added Alaska currently has
a higher requirement on recertification credit hours than
the FIRREA. The reason for this is if more courses were
offered in Alaska, more people would be able to receive the
education and become certified. CSHB 410, however, would
lower the Alaska requirement to meet the federal standards.
He noted the registered trainee was an internship way to
start someone in the business, offering a lesser experience
requirement than if they started working as an appraiser
without a certified person.
MR. LUCK referred to CHAIRMAN VEZEY's previous question
about an MAI designation, stating it was a nationally known
designation issued by a private organization. MAI is not
part of the Alaska program at all.
Number 152
CHAIRMAN VEZEY commented he thought there was only a
"handful" of MAI appraisers in Alaska.
Number 153
MR. FERRARA continued Alaska has about 22 MAI appraisers
which he felt was a really high percentage. He noted
Alaskan appraisers are typically more educated and
experienced than those in other states.
Number 162
CHAIRMAN VEZEY stated he would hold CSHB 410 in committee so
he may further research it. CSHB 410 would be rescheduled.
ADJOURNMENT
Having no more business before the committee, CHAIRMAN VEZEY
adjourned the meeting at 9:45 a.m.
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