Legislature(1993 - 1994)
03/31/1994 08:00 AM House STA
| Audio | Topic |
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* 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 31, 1994
8:00 a.m.
MEMBERS PRESENT
Representative Al Vezey, Chairman
Representative Pete Kott, Vice Chairman
Representative Gary Davis (arrived at 8:03 a.m.)
Representative Jerry Sanders
Representative Fran Ulmer (arrived at 8:23 a.m.)
MEMBERS ABSENT
Representative Bettye Davis
Representative Harley Olberg
COMMITTEE CALENDAR
CONFIRMATION HEARING:
State Public Offices Commission
James I. Adams
MOVED OUT OF COMMITTEE FOR JOINT SESSION
CONSIDERATION
HB 226: "An Act relating to interest rates and
calculation of interest under certain
judgments and decrees and on refunds of
certain taxes, royalties, or net profit
shares; and providing for an effective date."
HELD IN COMMITTEE
*HB 541: "An Act providing for an advisory vote of the
people concerning a preferred alternative for
increasing revenue available to support state
government; and providing for an effective
date."
FAILED TO MOVED OUT OF COMMITTEE
HB 345: "An Act relating to the preservation of
public facilities and to appropriations for
annual maintenance and repair, periodic
renewal and replacement, and construction of
public facilities."
MOVED FROM COMMITTEE AS CSHB 345(STA) WITH NO
RECOMMENDATIONS
HB 430: "An Act requiring certain applicants for a
driver's license to take a driver training
course."
MOVED FROM COMMITTEE AS CSHB 430(STA) WITH NO
RECOMMENDATIONS
HB 531: "An Act relating to the existence and
functions of certain multimember state
bodies, including boards, councils,
commissions, associations, or authorities;
and providing for an effective date."
DISCUSSED AMENDMENT
HB 420: "An Act relating to limited liability
companies; amending Alaska Rules of Civil
Procedure 20 and 24; and providing for an
effective date."
NOT HEARD
(* First public hearing)
WITNESS REGISTER
JAMES I. ADAMS
P.O. Box 1048
Nome, AK 99762
Phone: 443-3422
POSITION STATEMENT: Gave background information
DEBORAH VOGT, Assistant Attorney General
Department of Law
P.O. Box 110300
Juneau, AK 99811
Phone: 465-3603
POSITION STATEMENT: Addressed HB 226
REPRESENTATIVE JEANNETTE JAMES
Alaska State Legislature
Alaska State Capitol, Room 501
Juneau, AK 99811-0460
Phone: 465-3743
POSITION STATEMENT: Prime sponsor of HB 345
NANCY BEAR USERA, Commissioner
Department of Administration
P.O. Box 110200
Juneau, AK 99811-0200
Phone: 465-2200
POSITION STATEMENT: Commented on HB 345
ROGER PATCH, President
Alaska State Facility Administrators
P.O. Box 5-549
Ft. Richardson, AK 99505
Phone: 428-6670
POSITION STATEMENT: Supported HB 345
KIT DUKE
Alaska State Facility Administrators
303 K St.
Anchorage, AK 99501
Phone: 264-8238
POSITION STATEMENT: Supported CSHB 345
REPRESENTATIVE JOE GREEN
Alaska State Legislature
Alaska State Capitol, Room 114
Juneau, AK 99811-0460
Phone: 465-4931
POSITION STATEMENT: Sponsor of HB 430
JUANITA HENSLEY, Chief of Driver Services
Division of Motor Vehicles
Department of Public Safety
P.O. Box 20020
Juneau, AK 99802
Phone: 465-2650
POSITION STATEMENT: Answered questions on HB 430
PREVIOUS ACTION
BILL: HB 226
SHORT TITLE: INTEREST RATES: JUDGMENTS/TAXES/ROYALTIES
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR
JRN-DATE JRN-PG ACTION
03/12/93 620 (H) READ THE FIRST TIME/REFERRAL(S)
03/12/93 620 (H) STATE AFFAIRS,JUDICIARY,FINANCE
03/12/93 620 (H) -4 ZERO FNS(ADM, ADM, REV,
DOT) 3/12/93
03/12/93 621 (H) GOVERNOR'S TRANSMITTAL LETTER
04/03/93 (H) STA AT 08:00 AM CAPITOL 102
04/03/93 (H) MINUTE(STA)
03/31/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 541
SHORT TITLE: ADVISORY VOTE REGARDING STATE REVENUE
SPONSOR(S): FINANCE
JRN-DATE JRN-PG ACTION
03/23/94 2937 (H) READ THE FIRST TIME/REFERRAL(S)
03/23/94 2937 (H) STATE AFFAIRS
03/31/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 345
SHORT TITLE: PRESERVATION OF PUBLIC FACILITIES
SPONSOR(S): REPRESENTATIVE(S) JAMES
JRN-DATE JRN-PG ACTION
01/07/94 2018 (H) PREFILE RELEASED
01/10/94 2018 (H) READ THE FIRST TIME/REFERRAL(S)
01/10/94 2018 (H) STATE AFFAIRS, FINANCE
01/25/94 (H) STA AT 08:00 AM CAPITOL 102
01/25/94 (H) MINUTE(STA)
02/08/94 (H) STA AT 08:00 AM CAPITOL 102
02/08/94 (H) MINUTE(STA)
03/08/94 (H) STA AT 08:00 AM CAPITOL 102
03/08/94 (H) MINUTE(STA)
03/31/94 (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
03/17/94 (H) MINUTE(STA)
03/31/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 531
SHORT TITLE: ELIMINATE SOME STATE MULTIMEMBER BODIES
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR
JRN-DATE JRN-PG ACTION
03/11/94 2728 (H) READ THE FIRST TIME/REFERRAL(S)
03/11/94 2728 (H) STATE AFFAIRS
03/11/94 2728 (H) -7 ZERO FNS (DCRA, 2-DCED,
CORR, 2-DOE
03/11/94 2728 (H) DNR) 3/11/94
03/11/94 2729 (H) GOVERNOR'S TRANSMITTAL LETTER
03/29/94 (H) STA AT 08:00 AM CAPITOL 102
03/29/94 (H) MINUTE(STA)
BILL: HB 430
SHORT TITLE: LIMITED LIABILITY COMPANIES
SPONSOR(S): REPRESENTATIVE(S) THERRIAULT,Mulder,James
JRN-DATE JRN-PG ACTION
01/31/94 2206 (H) READ THE FIRST TIME/REFERRAL(S)
01/31/94 2206 (H) L&C, JUDICIARY, STATE AFFAIRS
02/24/94 2522 (H) SPONSOR SUBSTITUTE
INTRODUCED-REFERRALS
02/24/94 2522 (H) L&C, JUDICIARY, STATE AFFAIRS
03/08/94 (H) L&C AT 03:00 PM CAPITOL 17
03/09/94 2676 (H) L&C RPT 1DP 3NR
03/09/94 2676 (H) DP: MULDER
03/09/94 2676 (H) NR: WILLIAMS, SITTON, HUDSON
03/09/94 2676 (H) -ZERO FISCAL NOTE (DCED) 3/9/94
03/09/94 2703 (H) COSPONSOR(S): MULDER
03/18/94 (H) JUD AT 01:15 PM CAPITOL 120
03/21/94 (H) MINUTE(JUD)
03/23/94 (H) JUD AT 01:00 PM CAPITOL 120
03/30/94 (H) JUD AT 01:15 PM CAPITOL 120
03/31/94 3106 (H) COSPONSOR(S): JAMES
03/31/94 (H) STA AT 08:00 AM CAPITOL 102
ACTION NARRATIVE
TAPE 94-41, SIDE A
Number 000
CHAIRMAN AL VEZEY called the meeting to order at 8:02 a.m.
Members present were REPRESENTATIVES KOTT and SANDERS. He
announced REPRESENTATIVE OLBERG would be absent.
JAMES I. ADAMS - CONFIRMATION TO THE STATE PUBLIC OFFICES
COMMISSION
CHAIRMAN VEZEY opened the Confirmation of James Adams for
discussion.
Number 018
JAMES ADAMS joined the committee from an offnet
teleconference site in Nome.
CHAIRMAN VEZEY asked if MR. ADAMS knew what he was getting
into.
MR. ADAMS responded he was new to the operation and he will
find out.
CHAIRMAN VEZEY, as a former Alaska Public Offices Commission
member, stated it will be a very educational experience.
(REPRESENTATIVE KOTT left the meeting at 8:03 a.m.)
(REPRESENTATIVE G. DAVIS joined the meeting at 8:03 a.m.)
CHAIRMAN VEZEY noted REPRESENTATIVE G. DAVIS had joined the
meeting. He noted a quorum was not present, therefore the
committee would wait a few minutes to take the vote.
CSHB 226: "An Act relating to the rate of interest and
service charges in the state; relating to interest rates and
calculation of interest under certain judgments and decrees
and on refunds of certain taxes, royalties, or net profit
shares; and providing for an effective date.
CHAIRMAN VEZEY opened HB 226 for discussion. He recognized
the committee substitute, version E, before the committee
and asked if there was a motion to adopt it for
consideration.
Number 073
REPRESENTATIVE GARY DAVIS so moved.
Number 076
CHAIRMAN VEZEY, hearing no objection, adopted CSHB 226,
version E.
Number 087
DEBORAH VOGT, ASSISTANT ATTORNEY GENERAL, addressed HB 226
requested by the Governor. She had not had access to CSHB
226, therefore she addressed the original HB 226. She
stated the Governor requested HB 226 to address two
problems. First, the interest rates of both pre and
postcivil judgments are a set statutory 10.5 percent. This
10.5 percent does not fluctuate with market, therefore it is
sometimes grossly disproportionate to what the state, a
corporation, or an individual can earn to represent the time
value of money while litigation is pending. The
Administration believes interest on judgments should not be
an incentive for one party to settle, or for the other party
to delay the litigation. The rate should fluctuate with the
market and represent the time value of the money.
MS. VOGT stated the second purpose of HB 226 is to address
the problem with back taxes and royalties. She noted the
interest rate for those payments was amended in the 1991
legislative session to be a floating market interest rate,
with an 11 percent floor. The interest rate on underpayment
is the same as the interest rate on overpayment. Therefore,
if a company overpays its taxes or royalties, it will be
entitled to the same interest today from the state that the
state would have collected, had the party underpaid. She
believed the considerations for interest are substantially
different for taxes and royalties from civil litigation.
She noted concern that the legislation has had the
unintended effect of setting up the possibility that an
individual or corporation might overpay their taxes or
royalties, thereby entitled to an interest payment on a
refund disproportionate to what the market would support.
MS. VOGT commented the state is interested in these interest
rates because it is a common litigant, much more as a
defendant than a plaintiff. HB 226 proposes that both pre
and postjudgment interests will be a floating market rate
tied to the coupon yield equivalent of the sales of treasury
bills. This market indicator was chosen because it is used
by the federal courts and lawyers are at least partially
familiar with it. Their intent was to find an indicator
that was reasonably reflective of the true market and
adopted into civil litigation. Interest rate simplicity is
a concern with civil litigation. There needs to be an
indicator that tracks the market and is simple enough that
civil litigants understand and apply it.
MS. VOGT stated the Administration chose the coupon yield
equivalent as of January 1 for the preceding 52 weeks. The
indicator would change each year, not each month.
MS. VOGT addressed the amendments proposed by the
Administration to the original HB 226. Regarding civil
litigation, they suggest an amendment to the effective date
making those parts of HB 226 effective as of January 1,
1995, rather than immediately. This would ease both the
private sector and the state court system.
MS. VOGT referred to a sentence regarding the tax and
royalty provisions in both the committee substitute and the
original HB 226, which reads, "However, if the overpayment
is the result of a correction made by the department, the
amount overpaid bears interest at the rate, and in the
manner provided in (d) of this section." This language was
intended to make a distinction between overpayments which
are the fault of Department of Natural Resources or the
Department of Revenue, versus the fault of the tax or
royalty payer. She stated this language would be extremely
difficult to apply; therefore, it should be omitted from
both the tax and royalty sections.
Number 258
CHAIRMAN VEZEY asked MS. VOGT to clarify which version she
was referring to.
MS. VOGT clarified she was addressing the original HB 226.
She stated the Administration would oppose CSHB 226 because
it does fulfill the intentions of the Administration.
Referring to CSHB 226, the market indicator chosen for civil
litigation is five points above the federal reserve discount
rate. This would be significantly higher than the rate set
out in the original HB 226. She distributed and outlined a
comparison chart for the committee. (A copy of the chart is
on file.)
Number 293
CHAIRMAN VEZEY clarified the federal discount rate has been
constant since July 1, 1992 at three percent. He noticed
her report showed the rate at 3.5 percent in 1992.
Number 297
MS. VOGT responded she received the figures from the
Department of Revenue and they had simply conveyed the
figures were from "January." Therefore, she assumed they
meant "January, 1, 1992." She did not dispute that the rate
changed to three percent in July.
MS. VOGT redirected to the report and examined the
difference between the middle column, portraying the CSHB
226 discount rate plus five percent and the far right
column, portraying the HB 226 coupon yield equivalent. She
submitted that the coupon yield equivalent numbers were more
reflective of the time value of money.
MS. VOGT addressed CSHB 226 as it deals with provisions on
taxes and royalties. She stated CSHB 226 raises the
interest rate the state would pay on overpayments back up to
five points above the federal discount rate. Except for the
11 percent floor, it would be the same rate the state
charges for royalty and taxpayers for underpayment. The
point of the original HB 226 was to make a difference
between underpayment and overpayments; similar to federal
procedure. The 11 percent floor is also removed from the
interest on overpayments in CSHB 226.
MS. VOGT pointed out the tort reform legislation which has
been proceeding through the legislature, also has interest
on judgments provisions in it. She noted those provisions
were more similar to CSHB 226, except that they are three
percent, instead of five percent above the federal discount
rate. The legislature would have to choose which type of
legislation it would like to follow since there are two
similar pieces flowing through the process.
Number 345
CHAIRMAN VEZEY asked her to clarify which two pieces of
legislation.
MS. VOGT clarified the tort reform legislation with interest
on pre and postcivil judgment provisions.
Number 351
CHAIRMAN VEZEY commented "the Governor's proposal to tell
people that their money is worth 3.49 percent, or slightly
above that discount rate, is license of steel." Therefore,
he held CSHB 226 in committee for further consideration.
HB 541 - ADVISORY VOTE REGARDING STATE REVENUE
CHAIRMAN VEZEY opened HB 541, proposed by the House Finance
Committee, for discussion. Seeing no one present from the
House Finance Committee, he asked for questions from the
committee.
Number 369
REPRESENTATIVE JERRY SANDERS asked why the statement "none
of the above" was not on the bill, and if it was possible to
add it.
(REPRESENTATIVE KOTT returned to the meeting at 8:22 a.m.)
Number 372
CHAIRMAN VEZEY replied it could be added. If "none of the
above" was added, he believed the title would have to be
changed. HB 541 was not intended to propose a total
solution to the state's fiscal problems. The intent of HB
541 is to ask, if revenues are going to be increased, how
should it be done. He noted if "cut spending" was included
in the title it would probably be the largest vote getter.
(REPRESENTATIVE ULMER entered the meeting at 8:23 a.m.)
Number 392
REPRESENTATIVE SANDERS stated he felt if "none of the above"
or "cut spending" was put on HB 541 and there was a strong
vote, it would give the legislature a lot of credibility in
its attempt to cut spending. He added the legislature had
not done very much to cut spending in the last few years.
Number 397
CHAIRMAN VEZEY stated, from polls he had seen, the public
indicates they are very strongly in favor of cutting
spending. He recognized the budget cannot be balanced
simply by cuts nor strictly by tax increases. The intent of
HB 541 is to determine which vehicle, either tax increases
or permanent fund dividend reductions, would be preferred to
help balance the budget.
Number 407
REPRESENTATIVE G. DAVIS expressed the fact that HB 541 is an
advisory vote; it leaves open all options. HB 541 does
state a tax will be imposed. He related to the difficulty
in making cuts and the fluctuations in revenue in the past.
He noted the differences in the legislature after each
election. He did not believe the "none of the above"
section was necessary. He believed people were more
concerned about which option the state should take. The
question is "when" and "if." He explained, with the
dividends the state has been giving money, yet taxing
through different fee schedules.
Number 433
CHAIRMAN VEZEY stated HB 541 was up to the committee and
they could propose amendments. He interpreted
REPRESENTATIVE G. DAVIS's remarks as HB 541 being a
referendum, recognizing at some time state revenues would
have to be increased, noticing the balance of the budget
cannot be reached solely by cuts.
Number 440
REPRESENTATIVE FRAN ULMER questioned if there had been any
thought about indicating in HB 541 as to what levels the
changes would have to be at to raise equivalent amounts of
money. The public might think of a sales tax being between
two-four percent; however, they would not know how high it
would have to be to generate the same level of revenues as
the permanent fund dividend reductions would. She suggested
not putting the information on the ballot itself, but
perhaps presenting it in the discussion part included with
the ballot.
(REPRESENTATIVE KOTT left the meeting at 8:26 a.m.)
REPRESENTATIVE G. DAVIS agreed with REPRESENTATIVE ULMER.
He believed a key factor of a ballot measure is simplicity;
therefore a "findings section" could be included to indicate
projected levels over the next ten years. He reflected on
what he had seen, in relation to the constitutional budget
reserve, in the packet on HB 58 which showed pros and cons.
A large feedback response from different groups was likely.
A "findings section" to be transmitted publicly, but not on
the ballot, would be optimum.
Number 487
REPRESENTATIVE ULMER added at local elections usually long
descriptions are put on the ballot for either sales tax
proposals or bond proposals. She attributed this to the
theory that a lot of people who attend the polls may not
have had the opportunity to read through the information
before hand. She referred to HB 541 as "spare" and felt it
may not elicit an appropriate response.
Number 498
CHAIRMAN VEZEY pointed out in the late 20s when putting
federal income tax in statute was being considered, it was
considered that it never exceed 10 percent. At the time,
the politicians felt this would scare people from voting on
a constitutional amendment to ratify an income tax.
Therefore, it was left blank with no ceiling. He noted the
present rate of nearly 40 percent. He believed it began at
three percent.
Number 510
REPRESENTATIVE G. DAVIS questioned if HB 541 did pass, would
the Lt. Governor's office put the wording together, or does
it read as stated in the bill.
CHAIRMAN VEZEY clarified the Lt. Governor's office is
supposed to word a ballot proposition in keeping with the
statute. He noted HB 541 states the question shall appear
substantially in the following form, which he believed would
preclude extraneous information.
Number 521
REPRESENTATIVE ULMER explained they usually seek for a
supporter and an opponent to prepare the pro and con
statement. She noted HB 541 was a little different because
it listed options.
REPRESENTATIVE ULMER suggested a letter of intent from the
committee to the Lt. Governor's office asking for a layout
of numbers in the background material of the voter's
pamphlet.
Number 530
CHAIRMAN VEZEY stated he believed the committee was
confusing the issue, because HB 541 was not addressing a
level of taxation or how much revenues the state is short
over its current spending pattern. HB 541 asks which
vehicle the public feels is more appropriate for increasing
moneys available to the general fund.
REPRESENTATIVE ULMER responded she understood. She brought
up a situation, whereby a sales tax of 15 percent was
necessary to equal revenue generated by a state income tax
of two percent, as an example. She believed data regarding
the choice of limiting permanent fund earnings should be
available to state what kind of limit would equal what
percentage of sales tax.
REPRESENTATIVE ULMER stated she did not have an amendment to
propose.
Number 546
CHAIRMAN VEZEY asked the pleasure of the committee.
Number 549
REPRESENTATIVE G. DAVIS moved to move HB 541 from committee
with individual recommendations.
Number 550
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES VEZEY, ULMER, G. DAVIS.
OPPOSED: REPRESENTATIVE SANDERS.
ABSENT: REPRESENTATIVES KOTT, B. DAVIS, OLBERG.
MOTION FAILED
(REPRESENTATIVE KOTT returned to the meeting at 8:39 a.m.)
CHAIRMAN VEZEY brought up the Confirmation of James Adams to
take the vote. He moved the committee forward the
nomination of James Adams to the Alaska Public Offices
Commission without any specific recommendations, for the
consideration of the Joint Session. He asked the committee
secretary to call the roll.
IN FAVOR: REPRESENTATIVES VEZEY, KOTT, ULMER, G. DAVIS,
SANDERS.
ABSENT: REPRESENTATIVES B. DAVIS, OLBERG.
CSHB 345: "An Act relating to the maintenance of and art
requirements for certain public buildings and facilities and
to the art in public places fund; and providing for an
effective date."
CHAIRMAN VEZEY opened HB 345 for discussion. He asked if
there was a motion to adopt CSHB 345, version E.
Number 588
REPRESENTATIVE PETE KOTT so moved.
Number 589
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES VEZEY, KOTT, G. DAVIS,
SANDERS.
OPPOSED: REPRESENTATIVE ULMER.
ABSENT: REPRESENTATIVES B. DAVIS, OLBERG.
MOTION PASSED
Number 595
REPRESENTATIVE JEANNETTE JAMES, prime sponsor of CSHB 345,
gave a brief statement. She commented the committee had
heard HB 345 two other times. She expressed there really is
a problem with the deferred maintenance of public
facilities, therefore it was her intent to gain awareness
for the problem. She noted 1,717 buildings with a value of
$2.3 billion, excluding the University of Alaska, will
estimate $251 million in deferred maintenance. She believed
this number was conservative. The problem is critical.
REPRESENTATIVE JAMES explained CSHB 345 is simple, easy to
digest, and workable, as compared to her original HB 345.
She stated CSHB 345 would set up a fund for deferred
maintenance, whereby one percent of construction costs, on a
one time basis, would be put into it. A committee is then
set up to determine life costs and criteria to make up a six
year plan. CSHB 345 would determine an amount, per foot, of
assessment on those agencies who are in state facilities
owned by the state. That allocation would then go to take
care of the deferred maintenance. CSHB 345 would repeal the
statutes affecting the one percent for art program. She
stated this is because buildings are falling down around us
and the luxury of art cannot be afforded when the roof is
leaking. The proceeds of the general obligation and revenue
bonds would also go into the fund. Any federal funds,
additional appropriations and interest on the fund would
remain in the fund. She noted the appropriations into the
fund would be continuing; therefore, they would not lapse.
She proposed in the future, enough money would be in the
fund so as not only regular maintenance could be taken care
of, but also a portion would be set aside for components.
She offered to review the sectional analysis for the
committee.
Number 636
CHAIRMAN VEZEY noticed the committee did not have the
sectional analysis in their packets. He clarified HB 345
had a zero fiscal note because it is all subject to
appropriation.
Number 638
REPRESENTATIVE JAMES corrected there was a small fiscal note
of $151,300 from the Department of Administration (DOA)
because they would be assigned the task of putting together
the criteria to establish the six year plan and the
administrative duties of the committee. She noted the DOA
fiscal note would not be for the current year.
Number 650
CHAIRMAN VEZEY asked where the duties of the committee were
spelled out.
Number 653
REPRESENTATIVE JAMES replied it is defined that the
committee will establish the criteria on the life costs
system.
Number 657
CHAIRMAN VEZEY asked under which duty of the committee would
the establishment of a maintenance fund fee formula be. The
per square foot formula.
Number 660
REPRESENTATIVE JAMES answered under establishing the
criteria for the major maintenance needs of the state
buildings. She noted number 7 in the list of duties is to
review the life cycle costs.
Number 662
CHAIRMAN VEZEY recognized the sectional analysis was
distributed and stated REPRESENTATIVE JAMES could go through
it.
Number 663
REPRESENTATIVE JAMES outlined the sectional analysis. She
began with Section 1. Section 1 creates the state building
major maintenance fund consisting of appropriations and bond
proceeds. This fund operates separately and parallels the
system set up for the university, as stated in AS 35.50.020.
Nonlapsing appropriations are addressed so the
appropriations are not for one year. One percent of
construction costs of a state building are put into the
fund. The review committee is created consisting of the
Commissioners of Administration, Transportation and Public
Facilities, and three other departments selected by the
Governor on a two-year rotating basis. The Commissioner of
Administration would serve as the chair, reviewing all
covered entities except the university. The committee of
the Board of Regents may employ or contract for the
expertise needed to accomplish the required duties. The
committee's duties are established, which the Board of
Regents' duties will parallel. The Board of Regents however
will apply to university buildings. By January 15 each
year, the Commissioner of Administration will give the
legislature the committee's list of all current major
maintenance needs, a report of the committee's activities
for the previous fiscal year, and a prioritized list of
projects recommended for the next fiscal year. Parallel
requirements exist for the Board of Regents. The major
maintenance fee is addressed, existing parallel for the
Boards of Regents. The rate per square foot is used by the
Governor to prepare the annual budget. Section 1 includes
definitions for Board of Regents, building, committee,
department, state agency, state building, state fund,
university, university building, and university fund. The
definition for construction costs is included in AS
35.50.030(c).
TAPE 94-41, SIDE B
Number 000
REPRESENTATIVE JAMES continued.
REPRESENTATIVE JAMES stated Section 2 states the Alaska
State Council on the Arts remains in effect. However, the
council's authority over the art in public places fund is
deleted.
REPRESENTATIVE JAMES stated Section 3 states memorials
constructed under AS 44.35.030 are no longer subject to the
artworks in public buildings and facilities statute.
REPRESENTATIVE JAMES stated Section 4 repeals statutes
relating to Art Works in Public Buildings and Facilities,
the responsibility of the Alaska State Council on the Arts
to manage the art in public places fund, and the fund
itself.
REPRESENTATIVE JAMES stated Section 5 states Art Works in
Public Buildings and Facilities continues in effect for
works under contract if the contract is entered into before
the effective date of Section 4.
REPRESENTATIVE JAMES stated in Section 6 all provisions are
effective immediately except for the payment of the major
maintenance assessment fee, which becomes effective July 1,
1995.
Number 030
CHAIRMAN VEZEY noted REPRESENTATIVE JAMES's office had done
a lot of work on CSHB 345.
Number 032
REPRESENTATIVE JAMES stated she believed CSHB 345 was very
important, and deferred maintenance must be addressed.
Number 044
NANCY BEAR USERA, COMMISSIONER OF ADMINISTRATION, commented
on CSHB 345. She noted CSHB 345 calls for the DOA to be the
lead agency for implementation. The DOA believes the
maintenance and protection of the state's assets have been
grossly neglected, therefore a mechanism needs to be found.
She stated they have been trying to find a method for
several years and of all of the approaches, CSHB 345 makes
the most sense.
MS. USERA explained at the first sight of CSHB 345, she did
not like the emphasis on the DOA as the source of
implementation. She stated she now feels it makes sense.
The DOA would be most suitable because of its
responsibilities in providing overhead services to all state
agencies. The DOA would have the most "global" view of the
needs of the departments. The balance of the committee
would be very representative.
MS. USERA pointed out the six year plan and a funding source
that transcends from year to year would aid in the long term
approach. They have had difficulty with deferred
maintenance projects because when the funds lapse every
year, there is no carry forward. She noted with the
constraint of operating budgets, people use money which
otherwise might go for daily operational maintenance issues.
She recollected deferred maintenance on 2,500 buildings, so
an estimation of 1,700 might be low. She explained the
state has buildings as small as mobile homes in Bethel that
serve as the employment service office that need to be
maintained.
MS. USERA stated DUGAN PETTY, Director of the Division of
General Services, would be the key person for developing the
project work on CSHB 345. She explained their fiscal note
depicted a professional project approach to assessing the
needs of state buildings and devising the criteria. The DOA
would be able to prioritize the $251 million worth of
deferred maintenance projects.
Number 113
CHAIRMAN VEZEY asked the rate of how much the list of
deferred maintenance was growing each year.
Number 116
MS. USERA stated she did not know specifically.
Number 119
REPRESENTATIVE JAMES responded the fiscal note from the
original HB 345 was $61 million a year required to just meet
the life costs formula for existing maintenance of the
state's buildings.
Number 126
CHAIRMAN VEZEY stated he thought $61 million had included
operations.
Number 127
REPRESENTATIVE JAMES clarified the $61 million did include
utilities. She noted utilities are a very important part of
the process because as less maintenance is done, utilities
increase. She estimated a third, to a half of the $61
million might have been for utilities. She noted at least a
$30 million a year deficit in deferred maintenance.
Number 136
CHAIRMAN VEZEY asked if the fund CSHB 345 was creating would
not pay utilities.
REPRESENTATIVE JAMES answered the fund would not.
Number 146
CHAIRMAN VEZEY moved to the Anchorage teleconference site.
Number 150
ROGER PATCH, PRESIDENT, ALASKA STATE FACILITY ADMINISTRATORS
(ASFA), commented on CSHB 345. He stated ASFA is a
voluntary organization composed of facility representatives
from each of the agencies, the court system and the
university system. They have been studying the backlog of
deferred maintenance for the past five years. Deferred
maintenance is their largest common problem and biggest
concern. He expressed if the backlog was not addressed in
the immediate future, Alaska will be faced with rebuilding
facilities, as opposed to trying to preserve them. ASFA
supports CSHB 345. He stated ASFA is currently refining all
of its statistics to give the committee some updates on the
current value of the backlog.
Number 180
KIT DUKE supported CSHB 345. She testified that she agreed
with the testimony of MS. USERA and MR. PATCH. She worked
on the issue of deferred maintenance in 1993 and had
testified for the committee on Executive Order 89. She
expressed she was disappointed EO 89 was withdrawn; however,
she was pleased CSHB 345 was chosen to be addressed by the
legislature.
MS. DUKE stated she believed CSHB 345 was an important step
towards resolving the deferred maintenance issue.
Therefore, she urged the passage of CSHB 345 from committee
with do pass recommendations.
MS. DUKE explained CSHB 345 contains two elements address
how to eliminate the backlog, and how not to continue to
create it. She noted the nonlapsing fund and creating a
committee to take action by developing a six year plan. She
volunteered her time to ensure the six plan would be
prepared, if CSHB 345 were to pass.
Number 210
REPRESENTATIVE G. DAVIS inquired about AS 35.50.060,
committee duties as referred to in CSHB 345. He asked how
the function was performed now. Does each building have a
building maintenance supervisor that submits a list of
problems and cost estimates to his supervisor, or is it done
on an individual basis.
Number 226
MS. DUKE replied the process was not well organized. Major
institutions (e.g., correctional facilities, hospitals)
usually have a maintenance superintendent. A major combined
office facility will have a Department of Transportation
person, not responsible for only that building, that will
put together information about what work needs to be done.
The information will then proceed up through the chain of
command, whereby it may or may not get addressed by the
Governor's office or the legislature. She stated presently,
there is no comprehensive plan for buildings to be evaluated
by.
Number 243
REPRESENTATIVE G. DAVIS questioned if current procurement
policies and procedures get in the way of small repair
items.
MS. DUKE stated she did not believe that they need to. She
felt they can work within procurement regulations to
accomplish what needs to be done. Most importantly, there
needs to be a single point of focus and a plan for action.
She supported CSHB 345 in this effort.
Number 266
REPRESENTATIVE ULMER moved an amendment to delete Section 4
from CSHB 345.
Number 277
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES ULMER, G. DAVIS.
OPPOSED: REPRESENTATIVES VEZEY, KOTT, SANDERS.
ABSENT: REPRESENTATIVES B. DAVIS, OLBERG.
MOTION FAILED
Number 280
REPRESENTATIVE G. DAVIS commented a lot of work had been
done on CSHB 345, and there was no question that something
needed to be set up. He noted the similar process he has
experienced from the municipal level. CSHB 345 would save
the state money in the future.
REPRESENTATIVE G. DAVIS moved to pass CSHB 345 from
committee with individual recommendations.
Number 307
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES VEZEY, KOTT, ULMER, G. DAVIS,
SANDERS.
ABSENT: REPRESENTATIVES B. DAVIS, OLBERG.
MOTION PASSED
HB 430 - LICENSING REQUIREMENTS FOR DRIVERS
CHAIRMAN VEZEY opened HB 430, sponsored by REPRESENTATIVE
JOE GREEN, for discussion. He recognized a new committee
substitute was before the committee. He asked if there was
a motion to adopt CSHB 430, version E.
Number 332
REPRESENTATIVE G. DAVIS so moved.
Number 335
CHAIRMAN VEZEY, hearing no objection, adopted CSHB 430.
Number 337
REPRESENTATIVE JOE GREEN, sponsor, addressed CSHB 430. He
stated at the previous hearing regarding HB 430 there had
been a question about young persons who might be employed
after the one o'clock curfew. He directed the committee to
page 2, beginning line 25, which addresses this question.
So long as the person who may have been driving is driving
to or from, on the most direct route, his place of work to
his place of living, he/she would be excluded.
Number 357
JUANITA HENSLEY, CHIEF OF DRIVER SERVICES, DIVISION OF MOTOR
VEHICLES, DEPARTMENT OF PUBLIC SAFETY (DPS), answered
questions on CSHB 430. She directed the committee to a
letter of March 18, 1994, which was written to her by the
Trauma Registry Coordinator, Emergency Medical Services
Section, Department of Health & Social Services. The letter
stated the average cost of hospitalization for a person
under the age of 21 involved in a serious accident is
$25,984. This cost does not include rehabilitation costs or
costs to the physicians themselves.
MS. HENSLEY reviewed a second table entitled, 1992 ALASKA
DRIVERS IN TRAFFIC CRASHES, prepared by the roadway and
accident file from DPS. This table states the number of
licensed drivers in Alaska, their ages, and the percentages
of those drivers. She pointed out the age group that CSHB
430 addresses only comprises 6.2 percent of all licensed
drivers in the state of Alaska.
MS. HENSLEY compared that percentage to the next chart
entitled, ALASKA YOUTH CRASH STATISTICS - 1979 THRU 1992.
The 16-20 age group is over-represented in the number of
crashes, and the number of injury and fatal crashes, they
have. She noted in 1992, Alaska had a total of 89 fatality
crashes including all ages. Of these 89 crashes, 21
involved youth. Therefore, they represented 23.6 percent of
the total fatal crashes in Alaska. In 1992, Alaska had a
total of 50 alcohol crashes, of which nine involved youth.
Therefore, 42.9 percent of youth crashes involved alcohol.
MS. HENSLEY examined the third chart entitled, ALASKA YOUTH
CRASH DEATH STATISTICS - 1979 THRU 1992. This chart stated
of the 89 total crashes in 1992, there was a total of 108
deaths. Of the 108 deaths, 25 or 23.1 percent were youth.
Of the 89 total crashes, there were 61 alcohol fatalities,
10 of which involved youth.
Number 417
CHAIRMAN VEZEY clarified 41 percent of alcohol related
accidents involved people under 21.
MS. HENSLEY corrected 40 percent.
MS. HENSLEY referred to another pie chart entitled, 1992
INJURY AND FATAL CRASH DRIVERS, which breaks down two hour
segments of time in a day. She pointed out in 1992, 32
percent of injury and fatal youth crashes were between 8
p.m. and 6 a.m. She repeated the 16-20 age group is only
6.2 percent of the licensed drivers, as opposed to the other
92 percent which are over the age of 21. In comparison of
the two age groups, the 1992 injury and fatal crashes
between 8 p.m. and 6 a.m. involve 32 percent of youth,
whereas only 23 percent involve those 21 or older.
Number 446
CHAIRMAN VEZEY inquired if he could assume all of the
fatalities involving youth occurred between the hours of 8
p.m. and 6 a.m.
MS. HENSLEY answered of the 32 percent, yes.
REPRESENTATIVE GREEN clarified not all teenage deaths occur
during those hours, just a propensity.
Number 451
CHAIRMAN VEZEY asked if was correct in assuming that all of
the alcohol related teenage fatalities occurred between 8
p.m. and 6 a.m.
MS. HENSLEY replied she had not done that chart; however,
she could get that information transmitted from Department
of Transportation.
MS. HENSLEY commented the injuries and fatalities are
basically the same for youths and those over 21, even during
mid-day for the same amount of drivers. She emphasized the
youth only make up 6.2 percent of drivers, therefore they
are over-represented in the statistics.
CHAIRMAN VEZEY clarified 6.2 percent.
Number 462
MS. HENSLEY stated 12.9 percent of the overall crashes in
Alaska involved youth under the age of 21. She noted 12.9
percent was quite high for only comprising 6.2 percent of
the licensed drivers.
MS. HENSLEY referred to an article entitled, STATUS REPORT,
March 19, 1994, by the Insurance Institute For Highway
Safety. This report addresses the intent of CSHB 430 and
how it proposes to reduce crash rates and fatalities.
MS. HENSLEY referred back to the letter sent to her by the
EMS which showed the average hospitalization cost is $25,984
for each individual, per accident. She did not know what
percentage did not involve insurance or what the societal
cost to the state was. She believed, however, it would be
quite substantial. She stated 184 patients were in this
category where the average cost of hospitalization was
$25,984 per patient. The physician fees and rehabilitation
costs were not included in this average. She noted 21
patients, or 11.4 percent, were discharged with
disabilities, and 11 patients were discharged to a
rehabilitation center.
Number 497
CHAIRMAN VEZEY clarified the group of drivers under the age
of 21 represented 6.2 percent of the driving population. He
stated 32 percent of the total injury and fatal crashes,
between the hours of 8 p.m. and 6 a.m. involved youth. He
inquired if the statistic meant injury and fatality, or
injury and/or fatality.
MS. HENSLEY answered injury and/or fatality. She compared
that number to individuals over 21 who are involved in 23
percent of the crashes.
Number 530
CHAIRMAN VEZEY asked what percentage of fatalities youth
were involved in.
MS. HENSLEY replied 42.9 percent were involved in fatal
crashes. Youth deaths were 40 percent of the 108 fatalities
in 1992. She emphasized they only represent 6.2 percent of
all the licensed drivers. She pointed out this trend is
nationwide. She hoped to be able to present a chart
examining the statistics based on the days of the week. For
example, were Friday and Saturday nights higher than Monday
through Thursday.
Number 547
REPRESENTATIVE ULMER stated she believed the numbers were
very convincing and she moved to pass CSHB 430 out of
committee. She complimented MS. HENSLEY on the charts.
Number 552
REPRESENTATIVE KOTT asked where the charts came from.
MS. HENSLEY responded they were developed from information
received from the Highway Safety Planning (HSP) agency. The
Governor's representative for HSP put together the pie
chart. The information for the pie charts was received from
DOT's roadway and accident files. She noted DOT has a
complete database of all the accidents occurring in Alaska.
Number 559
REPRESENTATIVE KOTT inquired about the non-pie charts.
MS. HENSLEY answered the non-pie charts were also put
together by HSP.
Number 561
REPRESENTATIVE KOTT commented the numbers represented for
the total fatalities for those drivers under 21 did not
explicitly prove to him that youths were behind the wheel
driving. They could have only been in the vehicle.
MS. HENSLEY replied REPRESENTATIVE KOTT was correct;
however, statistics broken down by the age of the driver,
show teenage drivers are usually behind the wheel.
Number 572
REPRESENTATIVE KOTT gave the example of a 17 year old
fatality involved in an accident where the parents were
driving. He noted this type of fatality would be included
in the chart. He questioned the statistics given.
Number 576
REPRESENTATIVE GREEN believed the debate was going from
"statistics to fantasy..." He suggested, by the same
example, that a mature driver could be driving whereby a
teenager was killed, or the reverse. He believed the
question was not germane to CSHB 430. He reminded the
committee of the rates insurance companies charge for
drivers in the under 21 category, versus the mature driver.
He noted there is a reason the cost for young drivers was
more than twice as much.
REPRESENTATIVE KOTT stated he was trying to draw some
correlation between a youthful driver and their action. He
stated this was the key to CSHB 430. If 80 percent of the
statistics before the committee dealt with fatalities of
those under 21 who were passengers, then the data is skewed
and disproportionate. He questioned if the 40 percent of
youth involved in fatalities actually reflected their
driving habits.
Number 600
MS. HENSLEY directed REPRESENTATIVE KOTT to the ALASKA YOUTH
CRASH DEATH STATISTICS and pointed out of the 108 deaths, 10
involved alcohol. She emphasized 40 percent of youth
accident deaths involved alcohol. She believed this was an
awful high percentage.
Number 606
CHAIRMAN VEZEY questioned what the 10 alcohol youth deaths
represented 40 percent of.
Number 616
MS. HENSLEY corrected she had meant 40 percent of the total
number of teenagers killed involved alcohol deaths. There
was a total of 61 alcohol related accident deaths in 1992.
She clarified 10 alcohol youth accident deaths out of 61
total would be 16.4 percent. There were a total of 25 youth
crashes.
Number 619
REPRESENTATIVE KOTT questioned if the alcohol related
fatalities were taken out, would there still be a
disproportionate number of crashes involving those under 21.
Number 622
MS. HENSLEY believed the statistics would still be as high.
She referred to the pie chart which states during the
daytime, 32 percent of youth are involved in injury and
fatal crashes. She compared this to the adult evening
statistic of 23 percent. She estimated about 36 percent of
adults were involved in crashes during the daytime.
Number 635
CHAIRMAN VEZEY stated there was a motion before the
committee, however, he would hold the motion until next week
because a fiscal note was not provided with the committee
substitute.
Number 638
REPRESENTATIVE ULMER withdrew her motion.
Number 640
REPRESENTATIVE GREEN stated they do not get fiscal notes
until there is a reason for them. He asked if CSHB 430
would be killed.
Number 645
CHAIRMAN VEZEY replied he did not believe there would be
amendments to CSHB 430.
Number 646
REPRESENTATIVE KOTT said he might want to offer an amendment
to page 2, line 3, which raises the age of those that can
accompany a permit driver from 19. He stated he would be
more inclined to make the accompaniment a parent or legal
guardian.
Number 654
MS. HENSLEY addressed REPRESENTATIVE KOTT's proposed
amendment. If the provision was made a parent or legal
guardian, then those individuals would be excluded from
being able to take professional driver training.
Number 656
REPRESENTATIVE KOTT felt an allowance could be made.
Number 659
REPRESENTATIVE ULMER remembered there was a deadline for
personal sponsored bills in House Rules, and noted CSHB 430
was also referred to Finance. She wanted to move it out of
committee.
Number 663
MS. HENSLEY stated she believed CSHB 430 would have a zero
fiscal note. She mentioned the High Risk Drivers Act
presently in Congress which has passed one house and is in
the other, would give the states $1.2 million to implement
the CSHB 430 program. She said it was their intention to
apply for Section 402 grants for any costs of
implementation.
Number 670
CHAIRMAN VEZEY clarified CSHB 430 would have a zero fiscal
note. With the assurance of a zero fiscal note and
REPRESENTATIVE ULMER's annotation that CSHB 430 be moved
from committee, he stated there was no reason CSHB 430 could
not be moved from committee.
CHAIRMAN VEZEY asked the committee secretary to call the
roll.
IN FAVOR: REPRESENTATIVES VEZEY, KOTT, ULMER, G. DAVIS,
SANDERS.
ABSENT: REPRESENTATIVES B. DAVIS, OLBERG.
MOTION PASSED
(REPRESENTATIVE KOTT left the meeting at 9:36 a.m.)
HB 531 - ELIMINATE SOME STATE MULTIMEMBER BODIES
CHAIRMAN VEZEY, under bills previously heard, opened HB 531
to discuss an amendment REPRESENTATIVE ULMER proposeD.
REPRESENTATIVE ULMER stated the amendment allows the
committee meetings to be held by teleconference to avoid
travel costs, it raises the jurisdiction of the committee
from $1,000 to $5,000, and adds language in Section 6 to
clarify the Museum Collections Advisory Committee (MCAC)
general duties pertain to acquisition and disposition, which
was recommended by the Karen Crane, Department of Education,
for clarity. The last line on page 1 deletes those sections
of HB 531 which had deleted the MCAC.
Number 692
CHAIRMAN VEZEY referred to Section 6 which states, "the
committee shall act in an advisory capacity to the board."
He could not remember what the board was.
Number 696
REPRESENTATIVE ULMER stated she guessed the Board of
Education.
TAPE 94-42, SIDE A
Number 000
CHAIRMAN VEZEY asked what Section 6 was doing.
REPRESENTATIVE ULMER clarified "acquisition and disposition"
is the language being added. The statute presently
reads,"the committee shall act in an advisory capacity to
the board as the general policies and programs of the state
museum." She stated Karen Crane suggested the change. She
reminded the committee most of the testimony received
pertained to MCAC's role in overseeing how money was spent
to either acquire or disposition of assets. The scope of
the MCAC's jurisdiction is narrowed by this additional
language. She stated she was imparticular about the change,
but it made DOE more at ease with HB 531.
Number 028
CHAIRMAN VEZEY clarified the amendment would narrow the
scope of the MCAC. He commented they used the word
"deaccession," and asked if "disposition" would be the
correct word to use.
REPRESENTATIVE ULMER responded "disposition" was recommended
by Karen Crane and Terri Lauterbach.
Number 047
CHAIRMAN VEZEY stated REPRESENTATIVE ULMER was clarifying in
Section 4 that a meeting could be held by teleconference.
In Section 5, the limit would be raised from $1,000 to
$5,000. He asked about raising the limit to $10,000.
REPRESENTATIVE ULMER replied she did not have any
information about how many acquisitions were within various
categories. She referred to previous testimony which stated
there are a number of small acquisitions under $5,000 which
would be freed up. She had no preference for $5,000 or
$10,000.
Number 069
CHAIRMAN VEZEY stated he remembered the testimony to state
they have a $50,000 acquisition budget, which they make 10-
11 acquisitions per year with. The average was about
$5,000.
REPRESENTATIVE ULMER said she just did not know.
Number 080
REPRESENTATIVE G. DAVIS commented he tended to support the
amendment even though he had concerns about the number of
boards and commissions. He felt the $5,000 level as
compared to $10,000, was questionable. He pointed out how
valuable a piece is to a collection might be more of a
question.
Number 101
CHAIRMAN VEZEY stated he believed the impetus for the change
was to remove fairly minor acquisitions from the purview of
the MCAC. He questioned the dollar value of a major
acquisition.
Number 113
REPRESENTATIVE ULMER offered to get a list from the museum
as to the costs of acquisitions.
Number 117
CHAIRMAN VEZEY stated a list would not be as important as
determining value. What is a major acquisition versus a
relatively minor acquisition made probably more out of
opportunity. Something to fulfill a collection would have a
lot a value, thereby costing a lot of money.
CHAIRMAN VEZEY, hearing no further questions, stated a
committee substitute would be drafted that adopts
REPRESENTATIVE ULMER's proposed amendment. He felt the
$5,000 could still be adjusted, if necessary.
Number 134
REPRESENTATIVE ULMER asked if HB 531 would be rescheduled
for Thursday or Tuesday of next week.
Number 136
CHAIRMAN VEZEY believed Tuesday.
ADJOURNMENT
CHAIRMAN VEZEY, having no more business before the
committee, adjourned the meeting at 9:45 a.m.
BILLS CANCELLED FROM THE SCHEDULE
HB 420 - LIMITED LIABILITY COMPANIES
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