03/24/2007 10:00 AM House STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB92 | |
| HB151 | |
| HB171 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 13 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 92 | TELECONFERENCED | |
| += | HB 151 | TELECONFERENCED | |
| += | HB 171 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE STATE AFFAIRS STANDING COMMITTEE
March 24, 2007
10:05 a.m.
MEMBERS PRESENT
Representative Bob Lynn, Chair
Representative John Coghill
Representative Kyle Johansen
Representative Craig Johnson
Representative Andrea Doll
Representative Max Gruenberg
MEMBERS ABSENT
Representative Bob Roses, Vice Chair
COMMITTEE CALENDAR
HOUSE BILL NO. 92
"An Act removing the victims' advocate and the staff of the
office of victims' rights from the jurisdiction of the office of
the ombudsman in the legislative branch."
- MOVED HB 92 OUT OF COMMITTEE
HOUSE BILL NO. 151
"An Act requiring an indemnification and hold harmless provision
in professional services contracts of state agencies, quasi-
public agencies, municipalities, and political subdivisions."
- MOVED CSHB 151(STA) OUT OF COMMITTEE
HOUSE BILL NO. 171
"An Act relating to the terms of legislators, the date and time
for convening regular legislative sessions, adoption of uniform
rules of the legislature and to certain of those rules, the date
for organizing the Legislative Budget and Audit Committee, and
deadlines for certain matters or reports to be delivered to the
legislature or filed; prohibiting bonuses for legislative
employees; and providing for an effective date."
- HEARD AND HELD
HOUSE BILL NO. 13
"An Act relating to prepayments of accrued actuarial liabilities
of government retirement systems; relating to the Alaska
Municipal Bond Bank Authority; permitting the Alaska Municipal
Bond Bank Authority or a subsidiary of the authority to assist
state and municipal governmental employers by issuing bonds,
notes, commercial paper, or other obligations to enable the
governmental employers to prepay all or a portion of the
governmental employers' shares of the unfunded accrued actuarial
liabilities of retirement systems; authorizing a governmental
employer to issue obligations to prepay all or a portion of the
governmental employer's shares of the unfunded accrued actuarial
liabilities of retirement systems and to enter into a lease or
other contractual agreement with a trustee or the Alaska
Municipal Bond Bank Authority or a subsidiary of the authority
in connection with the issuance of obligations for that purpose,
and relating to those obligations; and providing for an
effective date."
- BILL HEARING CANCELED
PREVIOUS COMMITTEE ACTION
BILL: HB 92
SHORT TITLE: JURISDICTION OF OMBUDSMAN: VICTIMS RTS
SPONSOR(s): REPRESENTATIVE(s) SAMUELS, STOLTZE
01/16/07 (H) PREFILE RELEASED 1/12/07
01/16/07 (H) READ THE FIRST TIME - REFERRALS
01/16/07 (H) STA, FIN
03/20/07 (H) STA AT 8:00 AM CAPITOL 106
03/20/07 (H) Scheduled But Not Heard
03/24/07 (H) STA AT 10:00 AM CAPITOL 106
BILL: HB 151
SHORT TITLE: INDEMNITY CLAUSE IN PUBLIC CONTRACTS
SPONSOR(s): REPRESENTATIVE(s) JOHNSON BY REQUEST
02/22/07 (H) READ THE FIRST TIME - REFERRALS
02/22/07 (H) STA, JUD
03/20/07 (H) STA AT 8:00 AM CAPITOL 106
03/20/07 (H) Heard & Held
03/20/07 (H) MINUTE(STA)
03/24/07 (H) STA AT 10:00 AM CAPITOL 106
BILL: HB 171
SHORT TITLE: ACCOMMODATE 90-DAY SESSION/LEG PROCEDURES
SPONSOR(s): RULES
03/01/07 (H) READ THE FIRST TIME - REFERRALS
03/01/07 (H) STA
03/06/07 (H) STA AT 8:00 AM CAPITOL 106
03/06/07 (H) Scheduled But Not Heard
03/15/07 (H) STA AT 8:00 AM CAPITOL 106
03/15/07 (H) Heard & Held
03/15/07 (H) MINUTE(STA)
03/22/07 (H) STA AT 8:00 AM CAPITOL 106
03/22/07 (H) Heard & Held
03/22/07 (H) MINUTE(STA)
03/24/07 (H) STA AT 10:00 AM CAPITOL 106
WITNESS REGISTER
REPRESENTATIVE BILL STOLTZE
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Offered an introduction of HB 92 as joint
prime sponsor.
REPRESENTATIVE RALPH SAMUELS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified as joint prime sponsor of HB 92.
KATHY HANSEN, Interim Director
Office of Victims' Rights
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 92.
LINDA LORD-JENKINS, Ombudsman
Office of the Ombudsman
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition to HB 92.
TREVOR FULTON, Staff
to Representative Craig Johnson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: On behalf of Representative Johnson, prime
sponsor by request, provided details regarding HB 151.
BOYD MORGENTHALER, P.E., Chair
A/E-Owner Contracts Committee
Alaska Professional Design Council (APDC)
Anchorage, Alaska
POSITION STATEMENT: Testified on behalf of APDC in support of
HB 151.
LEANNE BOLDENOW, Client Executive
Marsh USA, Inc.
Anchorage, Alaska
POSITION STATEMENT: Testified during the hearing on HB 151.
JOHN BOUCHER, Senior Economist
Office of the Director
Office of Management & Budget (OMB)
Juneau, Alaska
POSITION STATEMENT: Testified during the hearing on HB 171.
ACTION NARRATIVE
CHAIR BOB LYNN called the House State Affairs Standing Committee
meeting to order at 10:05:18 AM. Representatives Coghill,
Johnson, Doll, and Lynn were present at the call to order.
Representatives Johansen and Gruenberg arrived as the meeting
was in progress.
HB 92-JURISDICTION OF OMBUDSMAN
10:05:57 AM
CHAIR LYNN announced that the first order of business was HOUSE
BILL NO. 92, "An Act removing the victims' advocate and the
staff of the office of victims' rights from the jurisdiction of
the office of the ombudsman in the legislative branch."
10:06:20 AM
REPRESENTATIVE BILL STOLTZE, Alaska State Legislature, offered
an introduction of HB 92 as joint prime sponsor. He indicated
that the bill clarifies the jurisdiction of the state ombudsman
related to the Office of Victims' Rights (OVR). He said he was
one of the staff members who worked on the creation of OVR as an
office designed to be "a side-by-side entity" to the Office of
the Ombudsman and enforce the rights of victims as strongly
mandated by the legislature and approximately 83 percent of the
voting public in 1994. He said, "This was really the
implementing statute for that constitutional amendment." He
said the question at hand is whether or not the state should
have a strong victims' right agency that has the autonomy to be
able to enforce the constitutional rights of crime victims.
10:09:17 AM
REPRESENTATIVE RALPH SAMUELS, Alaska State Legislature, as joint
prime sponsor, explained that the Office of Victim's Rights has
gone through several iterations. He noted that at one time, OVR
was going to be housed in the executive branch. Then Governor
Tony Knowles vetoed that creation, which Representative Samuels
said in hindsight was a good thing. He explained if that had
been allowed, OVR would have been investigating entities such as
the Department of Law, the Public Defender's Agency, or the
Department of Public Safety, and all the roads from those
departments lead to the governor. He added, "So, you would have
been investigating yourself."
REPRESENTATIVE SAMUELS said eventually the Office of Victims'
Rights was put into the legislative branch. Whereas the Office
of the Ombudsman can investigate citizens' claims of problems
with departments, OVR is an ombudsman solely for the victims of
crimes, can hire attorneys, and has its own code of ethics, he
explained. He said the purpose of the bill is to ensure that
both the agencies answer to the legislature - not to each other.
He stated that he and Representative Stoltze were active in the
creation of a separate OVR and never meant it to be a subsection
of the Office of the Ombudsman.
10:11:41 AM
REPRESENTATIVE SAMUELS, in response to a question from
Representative Doll, said a person who has an issue with how
he/she is being treated by OVR would appeal directly to the
legislature.
10:12:46 AM
REPRESENTATIVE STOLTZE indicated that the legislature has a
strong voice regarding OVR.
10:13:46 AM
REPRESENTATIVE GRUENBERG noted that the statute that is being
amended [AS 24.55.330(2)] relates to jurisdiction of the Office
of the Ombudsman. He said all judicial judges would be exempted
from that statute, but hearing officers and administrative law
judges in the new Office of Administrative Hearings were not
included in the language. He surmised that HB 92 must have been
written before that office was created.
10:14:31 AM
REPRESENTATIVE STOLTZE said he does not have an answer to that.
REPRESENTATIVE GRUENBERG said he will not offer an amendment,
but it is an issue that should be discussed in the next
committee of referral.
10:15:31 AM
KATHY HANSEN, Interim Director, Office of Victims' Rights, said
she has been a staff attorney at OVR for three years. She
stated support for HB 92. She offered her understanding from
having spoken with the director of the Office of the Ombudsman
that that office's policy is to refer any crime victims who
request assistance or have complaint straight to OVR without
investigation. She stated that every one of the attorneys who
works at OVR has been a prosecutor and has criminal law
experience. She referred to AS 24.65.200, which read as
follows:
Sec. 24.65.200. Victims' advocate's privilege not to
testify or produce documents or other evidence.
Except as may be necessary to enforce the provisions
of this chapter, the determinations, conclusions,
thought processes, discussions, records, reports, and
recommendations of or information collected by the
victims' advocate or staff of the victims' advocate
are not admissible in a civil or criminal proceeding,
and are not subject to questioning or disclosure by
subpoena or discovery.
MS. HANSEN cited AS 24.65.180, which read as follows:
Sec. 24.65.180. Judicial review.
A proceeding or decision of the victims' advocate may
be reviewed in superior court only to determine if it
is contrary to the provisions of this chapter.
MS. HANSEN said the purpose of Section 180 was so that "the
director's discretion on crime victims' complaints would be
final and not subject to another review by another agency." She
said if the [Office of] the Ombudsman had authority to
investigate OVR, there could be disparate outcomes. For
example, the ombudsman could reverse a decision of OVR, but with
less information and expertise in the area of crime victims'
rights.
MS. HANSEN said OVR's attorneys also have an advocacy function,
in which they can litigate and provide free legal services to
crime victims and, when appropriate, file pleadings, appear in
court, and conduct behind the scenes advocacy. For example, a
lawyer in OVR can enhance criminal punishment when appropriate
during plea negotiations, and can ensure that crime victims
receive full restitution. Furthermore, OVR can access clemency
files from the governor's office and state court judges'
confidential documents and files. An OVR lawyer can look at
pre-sentence reports and advise victims regarding a judge's
sentence and whether or not to object to a plea agreement. Ms.
Hansen said that is not something the ombudsman should be
allowed to do even indirectly, because he/she might reverse
advice given by OVR. She said OVR is also involved with ongoing
criminal investigation. She said lawyers at OVR can give the
crime victim an independent legal opinion as to whether a matter
was timely and thoroughly investigated and whether it is or is
not a viable case for prosecution.
10:20:27 AM
MS. HANSEN said HB 92 is a simple fix that would change the
language related to the definition of agency. A more complex
fix would be to restructure AS 24.55 to allow the ombudsman to
have those additional duties and possibly add attorney staff.
She said OVR thinks it is appropriate to be reporting directly
to the legislature, and the fact that OVR's attorneys must
follow a code of ethics and rules of professional conduct is an
added bonus to the clients of that agency. One of those rules,
she pointed out, is that OVR provides due diligence to its
clients; therefore, in addition to being able to complain to the
legislature about any problems that might arise related to OVR,
they could also complain to the Alaska Bar Association. Ms.
Hansen concluded that in order to stem any confusion or
litigation, the bill must clearly show that the legislature
intends for OVR to be the special ombudsman for crime victims.
10:21:40 AM
REPRESENTATIVE GRUENBERG stated concern that [the Office of the
Ombudsman], without this bill, would have access to the
privileged information held by OVR. He asked if there is any
other way that that confidential information could be obtained
that should be of concern.
MS. HANSEN answered no. She offered further details.
10:23:02 AM
LINDA LORD-JENKINS, Ombudsman, Office of the Ombudsman,
testified in opposition to HB 92. She said passage of the bill
would take an action no legislature has seen fit to take in the
32 years since the Office of the Ombudsman was created. She
continued:
I believe this issue has arisen because an ombudsman
complainant, referred by my office to OVR for
assistance, returned to the ombudsman to complain that
OVR had not adequately investigated her complaint
before declining to take further action.
This complainant has authorized me to discuss some
aspects of this complaint, but ... I'm not going to
discuss very much. The issue here is an issue of
ensuring that a vulnerable young woman who was
horribly victimized is afforded the dignity and
respect and assistance to which she is entitled.
I'd like to state that the Office of the Ombudsman
recognizes the importance of the work done by OVR. My
opposition to this bill should not be interpreted in
any way as minimizing the value of the victims'
advocate or the assistance it provides to victims of
crime. My office repeatedly refers complainants to
OVR if it appears that OVR is better suited to handle
a complainant's issue, and I made such a referral as
recently as Monday evening. I plan on continuing to
do so. However, I believe that the mandate of the
ombudsman enabling a legislation requires that we ...
review or investigate complaints against state
agencies, and especially so when we receive complaints
about the quality of the services received after our
referrals.
I must take exception to the characterization that OVR
is the special ombudsman for crime victims. An
ombudsman is an impartial fact-finder - an impartial
neutral - who investigates complaints about those
agencies subject to its jurisdiction. The position
that OVR is a special ombudsman for crime victims is
contrary to every public statement of mission and
purpose heretofore made by OVR. Since its inception,
OVR was considered an advocate for crime victims, not
an impartial investigator. Stephen Branch Flower, the
first victims' advocate, characterized OVR as a
uniquely, publicly funded victims' rights law firm.
As this victims' rights law firm, OVR is authorized to
represent crime victims in criminal or juvenile court
proceedings to ensure that the rights provided by
Alaska's Constitution ... and laws are afforded.
That's why OVR is an agency created by the
legislature.
The best characterization of the services OVR provides
to victims is as an attorney. The record reflects
that OVR distinguished itself from the ombudsman in
its argument from Cooper v. District Court, Alaska
2006. OVR specifically argued that the Copper/Court's
comparison of OVR to the ombudsman was an error, as
OVR - unlike the ombudsman - has the responsibility of
advocacy. OVR stressed the provisions of Alaska
24.65.110, authorizing its advocacy for crime victims.
OVR also pointed to the fact that while the ombudsman
is expressly prohibited from intervening in ongoing
court proceedings, OVR is expressly authorized to
intervene on behalf of crime victims.
Other advocacy or investigatory agencies are within
the ombudsman's jurisdiction: the long-term care
ombudsman, Adult Protective Services, the Department
of Public Assistance Fraud Unit, the Human Rights
Commission, Alaska Judicial Council, and the Alaska
State Troopers all perform investigations. None are
excluded from the ombudsman's jurisdiction for fear of
adding an unnecessary layer of investigation, nor in
my 19 years with the ombudsman's office has the
ombudsman been accused of unnecessary oversight of
these agencies.
OVR is not unique in being either an advocate or an
investigator; its functions do not require exceptions
from the ombudsman's jurisdiction. Arguments that
being subject to ombudsman oversight would add an
unnecessary layer of investigation or result in the
ombudsman's reversal of a discretionary decision of
the victims' advocate reflect a misunderstanding of
the work of the ombudsman. It is not the authority or
intent of the ombudsman to reinvestigate victim
complaints against district attorneys, law
enforcement, et cetera. Instead, investigation of
OVR's actions - whether reasonable efforts to
investigate victims' complaints are made, whether more
weight was given to police officers' perspective than
the victims' well-being, whether victims of different
backgrounds and abilities are treated equally, whether
OVR complies with its own statutes and regulation - is
what is contemplated. Thus, it is not an additional
layer of investigation of a victim-complainant issue.
10:27:50 AM
Nor does an ombudsman oversight present a huge burden
of labor for the OVR. In the year since OVR was
created, the ombudsman has received only two
complaints against the agency. One was closed because
of ombudsman review of OVR statutes in light of the
Cooper decision. The other remains open, pending a
dispute over access to records. The fact that OVR
employs attorneys and litigates does not make it
unique. The Public Defender Agency, the Office of
Public Advocacy, and the Department of Law all
litigate and have specialized expertise. Each is an
integral part of state government providing services
to thousands and affecting each and every Alaskan.
The legislature placed all these agencies within the
ombudsman's jurisdiction. The ombudsman is empowered
to investigate these agencies without interfering with
court proceedings or infringing upon the privilege of
the agencies' clients. OVR provides the same sort of
services to Alaskans and so should be held to the same
standards of oversight. Neither is it within the
ombudsman's power to contravene the discretionary
action taken by a governmental agency, as long as that
action is a reasonable and lawful exercise of the
agency's discretion and is taken after thorough review
of all the facts. If, in the course of an
investigation, a reasonable exercise of discretion
based on relevant and proper grounds is found, the
ombudsman cannot and would not act to reverse such a
decision. If, however, investigation reveals
arbitrary and capricious exercises of discretion,
based on improper or irrelevant grounds, then the
ombudsman is authorized to suggest alternate courses
of action.
Additionally, we believe the fact that the OVR has
access to records of active criminal investigations
while the ombudsman does not is irrelevant. The case
at hand centers on the absence of investigation,
including the absence of an active criminal
investigation. AS 24.55.160 does not preclude access
to OVR's records of this victim's complaint, despite
the reference to the exclusion of records of active
criminal investigations. The point in the situation
at hand is that we have a complainant alleging that
there was no real investigation of the crime committed
- that what review was done was conducted in a highly
improper, totally insensitive manner, and there's no
active or ongoing investigation of such crime by the
police department or any other law enforcement agency.
OVR's investigation - if there was or is one - does
not constitute an active criminal investigation.
Finally, the ombudsman provides oversight nowhere else
available through [the] victims' advocate. Only the
ombudsman has statutory authority to review OVR rules
and OVR staff. Our review of the OVR statute does not
indicate that even the legislature has access to OVR
files. If not the ombudsman, who does oversee OVR?
"Who oversees the ombudsman?" you may ask. The
legislature oversees the ombudsman and when the
complainant grants the ombudsman permission to discuss
complaints, we discuss them with legislators.
Again, ... I am not in any way minimizing the value of
the victim's advocate or the assistance it provides to
victims of crime. This is not an issue of one agency
being more or less important than the other. This is
an issue of insuring that [a] vulnerable young woman
who was horribly victimized is afforded the dignity
and respect and assistance to which she is entitled.
For this reason I respectfully must enter my
opposition to HB 92.
10:31:16 AM
REPRESENTATIVE JOHNSON asked Ms. Lord-Jenkins if the Office of
the Ombudsman is also the investigating agency responsible for
the aforementioned case.
MS. LORD-JENKINS responded that the Office of the Ombudsman does
not have jurisdiction over the law enforcement agency. In
response to a follow-up question from Representative Johnson,
she reiterated that in the time since OVR's inception, the
Office of the Ombudsman has only received two complaints about
that entity. She mentioned one other case related to hours, but
said that was not a complaint against the victims' advocate.
10:32:47 AM
MS. LORD-JENKINS, in response to Representative Doll, relayed
that the Office of the Ombudsman currently has 8 staff: one
ombudsman, one administrative/intake officer, one intake
officer, and five investigators. She said the office has
requested one additional investigator during the coming fiscal
year. The office began in 1975, with 7 staff members, increased
to 26 investigators by 1986, decreased to 13 in 1987, increased
to 22 investigators in 1992, decreased to 11 in 1995, and
further reduced its staff in fiscal year 1997. The office was
granted one additional investigator in fiscal year 2006, she
said. She continued:
Our jurisdiction is to investigate complaints about
the administrative actions of State of Alaska
agencies. We do not have jurisdiction over elected
officials. We do not have authority to intervene in
matters that have been decided in court. We limit the
... issues that we investigate by regulation. If a
matter is subject to a collective bargaining
agreement, such as many state employees are governed
by, we don't investigate an action; that would be
subject to that agreement. We don't investigate
actions about which the complainant has known for more
than a year and not taken an action on. So, someone
cannot call us and say, "Well, back in 1996, the state
did this, and I want you to look at it now." We have
no statutory authority over individual municipalities
unless they contract with us. We have no statutory
authority over the actions of private companies [or]
private individuals.
MS. LORD-JENKINS, in response to Representative Doll, said the
present caseload year is less than it was in 1986 and 1995. She
explained, "That's more of a function of how we've done
outreach, and how we ... handle complaints." She said the
office no longer takes live complaints, but takes in filled out
complaint forms. She said the office continually makes
improvements to its service, and she reported that the complaint
load is increasing. In addition to handling specific
complaints, she said, the office has had approximately 1,300
"intake referrals" whereby it sends people to the proper entity
to solve the questions they have presented to the ombudsman.
10:36:59 AM
REPRESENTATIVE DOLL summarized that Ms. Lord-Jenkins is saying
that there are less people working in the Office of the
Ombudsman, but there are an increasing number of complaints.
MS. LORD-JENKINS confirmed that is correct.
REPRESENTATIVE DOLL emphasized the importance of having "checks"
in government. Furthermore, she stated her belief that it is
important to strengthen and encourage the jurisdiction of the
Office of the Ombudsman. She directed attention to a memorandum
in the committee packet from Tamara Cook, [Director, Legislative
Legal and Research Services, dated March 23, 2007, regarding the
authority of the ombudsman over records of OVR]. She said that
in the memorandum Ms. Cook notes that the ombudsman does have
rights over OVR related to jurisdiction. She stated her support
of the ombudsman and said she would not support HB 92.
10:38:31 AM
MS. HANSEN, in response to a question from Representative
Gruenberg, confirmed that an attorney could file an ethics
complaint with the [Alaska Bar Association] against any OVR
staff member. She said anyone could issue a complaint to the
Bar Association. She said if the complaint was that OVR was not
following its own statute, court action could be taken to have
the court issue an order that OVR must follow its statutes. The
complainant could also go to legislature, she said.
10:39:40 AM
REPRESENTATIVE GRUENBERG asked, "If that process were followed,
what access would they have to your records, et cetera?"
MS. HANSEN answered that the court would only be able to look at
whether [OVR] was following its own statutes. She reiterated
that AS 24.65.180 is the statute that addresses what review is
allowed superior court judges, while AS 24.65.200 gives OVR the
statutory privilege not to disclose its records "by subpoena or
through discovery in court proceedings."
10:40:50 AM
REPRESENTATIVE GRUENBERG asked if the following entities would
have any jurisdiction to investigate complaints: the Select
Committee on Legislative Ethics, Legislative Council,
Legislative Budget & Audit, or the [House or Senate] Judiciary
Standing Committee[s].
MS. HANSEN indicated that typically, individual legislators
inquire through their aides, and OVR provides them with the
information requested. She offered her understanding that the
Select Committee on Legislative Ethics has the authority to
review OVR.
10:41:49 AM
REPRESENTATIVE STOLTZE said he thinks the aforementioned
memorandum from Legislative Legal and Research Services
strengthens the need for HB 92. He noted that a large
percentage of the caseloads of the Office of the Ombudsman are
from convicted felons. He said sensitivity to victims is a
concern. He mentioned inherent conflicts and stated:
It wouldn't take very long for one to bump into
another when you're ... investigating a claim of a
convicted felon who's incarcerated and you're bumping
into a victims' rights issue - it doesn't take very
long with ... any kind of expanded caseload.
...Originally, we had the Office of Victim's Advocacy,
and there was a concern that the names were too close
together and people -- that's the level of sensitivity
.... So, we changed the name in our ... drafting
process and through the committee process.
REPRESENTATIVE STOLTZE noted that the Office of Victims' Rights
does not use general funds; it's funded through the use of
dividends from convicted felons. It has also spun off to fund
other entities, including the Council on Domestic Violence and
Sexual Assault and victims' compensation. Conversely, the
Office of the Ombudsman is asking for another $100,000 this
year. He continued:
It doesn't escape me that a big chunk of their
constituency that they ... respond to are people that
are incarcerated felons. ... That sort of rubs me
....
REPRESENTATIVE STOLTZE, regarding jurisdiction, said unlike many
other entities, OVR is an entity housed within the legislative
branch, and its director is confirmed by a super majority of the
legislature. He concluded:
... This is deeply rooted in philosophy .... I've
heard a little bit about the referenced case, and it's
a very sympathetic case, and I don't know whether ...
it was botched up - it was evidentiary issues. You
know, these things are complicated. ... Victims'
rights cases are ... fraught with a lot of emotion.
... I don't know the facts, and the one case ... is
certainly important, but probably not enough to change
your determination of whether or not ... this entity
should be independent. ... I can express very
certainly that was the ... will of the legislature,
being in on the birthing.
10:46:06 AM
REPRESENTATIVE SAMUELS said the legislature creates an ombudsman
to ensure that each agency is doing its job. He indicated that
both [the Office of the Ombudsman and OVR] were "created to be
equal." He said he does not agree with Ms. Lord-Jenkins. He
stated:
It was created after our ombudsman statute, and ...
you can go to the Bar Association, you can go to the
[Select Committee on Legislative Ethics], you can go
to your legislator - the same as if you had a problem
for an ombudsman. If you always have to have somebody
looking over your shoulder you'd have yet another
ombudsman's office, and yet another one on top of
that. Both of them go to the legislature.
... If you're investigating a woman who was raped, and
you are investigating a complaint by the man who raped
her, at the same time, you have a problem.
REPRESENTATIVE SAMUELS reminded the committee that there have
only been two complaints. He said if a person does not like the
action of OVR, he/she can take other avenues. The same holds
true regarding the Office of the Ombudsman, he said.
REPRESENTATIVE STOLTZE said appeals can be made through either
entity.
10:48:35 AM
CHAIR LYNN closed public testimony.
10:49:00 AM
REPRESENTATIVE COGHILL stated:
First of all, the fact that the rights of crime
victims rose to the level of a constitutional
amendment - Article 1, Section 24 - gives it kind of a
special place. And so, I'm going to vote for the
bill, because I really do believe that one of the
troublesome things in our justice system is that
justice sometimes can be lost in the process. And
this, I think, gives us the opportunity to focus that
process.
REPRESENTATIVE COGHILL said Ms. Lord-Jenkins brought up the
issue of accountability, and he said he thinks the legislature
should keep watch on that issue. He stated his support of HB
92.
10:50:07 AM
REPRESENTATIVE GRUENBERG said difficult cases can make bad law.
He noted that a high level of the ombudsman's cases involve
representing defendants. He stated, "That would create a real,
chilling effect on the Office of Victims' Rights if they could
turn around then and investigate the agency that represents the
victims. That would be a significant conflict of interest." He
continued:
This case that has been brought to our attention is an
unusual case where the allegation was that the agency
that's supposed to represent the victim didn't
represent the victim. ... If we didn't do something
about it, it could potentially create a much larger
problem with the fact that the ombudsman's more often
representing the other side - the defendant. ... So,
it's flipped around, and that has caused ... one of
the problems here.
REPRESENTATIVE GRUENBERG said the question is where people would
go if they had a problem with OVR. He echoed the comments of
Ms. Hansen that alternatives include: the Alaska Bar
Association, the Select Committee on Legislative Ethics, and
potentially some committees in the legislature. He said he is
sensitive to the concerns expressed by [Representative Doll],
but suggested that "that's an issue for another day." He said
he will support HB 92, because he said he wants to avoid serious
conflicts of interest.
10:53:42 AM
REPRESENTATIVE GRUENBERG [moved to report HB 92 out of
committee] with individual recommendations [and the accompanying
fiscal notes].
REPRESENTATIVE DOLL objected.
10:53:59 AM
A roll call vote was taken. Representatives Gruenberg, Coghill,
Johansen, Johnson, and Lynn voted in favor of moving HB 92 out
of committee. Representative Doll voted against it. Therefore,
HB 92 was reported out of the House State Affairs Standing
Committee by a vote of 5-1.
The committee took an at-ease from 10:54:50 AM to 11:00:19 AM.
HB 151-INDEMNITY CLAUSE IN PUBLIC CONTRACTS
11:00:21 AM
CHAIR LYNN announced that the next order of business was HOUSE
BILL NO. 151, "An Act requiring an indemnification and hold
harmless provision in professional services contracts of state
agencies, quasi-public agencies, municipalities, and political
subdivisions."
11:00:34 AM
REPRESENTATIVE COGHILL moved to adopt the committee substitute
(CS), Version 25-LS0479\E, Bannister, 3/21/07, as a work draft.
There being no objection, Version E was before the committee.
11:00:58 AM
REPRESENTATIVE JOHNSON, speaking as sponsor by request, said the
changes made through Version E narrowed the language, because
the original bill version may have had the unintended
consequence of costing "the permanent fund dividend" money.
11:02:29 AM
TREVOR FULTON, Staff to Representative Craig Johnson, Alaska
State Legislature, on behalf of Representative Johnson, prime
sponsor by request, provided details regarding HB 151. He
directed attention to the Legislative Legal and Research
Services memorandum, from Theresa Bannister, dated March 23,
2007, which he said outlines the changes made in Version E. One
change added the word "defense" to the bill title so that it
read:
"An Act requiring an indemnification, defense, and
hold harmless provision in construction-related
professional services contracts of state agencies,
quasi-public agencies, municipalities, and political
subdivisions."
MR. FULTON noted that the term "construction-related
professional services" was also added to the bill.
11:04:36 AM
REPRESENTATIVE GRUENBERG remarked that the use of the term
"consultant" invites a heightened scrutiny, not only by the
legislature but also by the general public. He noted that John
Walsh was sitting in the room, and he said he "represents these
folks." He suggested using another, less controversial term.
11:05:35 AM
REPRESENTATIVE JOHNSON noted that he has at one time worked as a
consultant and during his political campaign he was reluctant to
tell people about that, "because of that black eye." He stated
that consultants serve an important purpose. He illustrated how
consulting can be an honorable profession, noting, for example,
that companies that cannot afford to hire their own people can
bring in consultants for very specific purposes. He said that
although he appreciates Representative Gruenberg's comments, he
does not want to jump on the bandwagon of depicting consultants
negatively.
11:07:25 AM
BOYD MORGENTHALER, P.E., Chair, A/E-Owner Contracts Committee,
Alaska Professional Design Council (APDC), told the committee
that APDC is a consortium of professional societies that
represents the 5,000 architects, engineers, and land surveyors
registered in Alaska. He stated that APDC supports Version E of
HB 151 as an important issue for all Alaskan consultants. He
said the bill is about liability. When two parties enter a
contract, each expects the other to be responsible for their own
actions. In particular, he noted, each party is responsible for
their sole liabilities. He said "indemnification" and "hold
harmless" are two terms that are used frequently in contracts.
He continued:
Hold harmless is simply an agreement by one party to
not hold the other party responsible for certain acts
or under certain circumstances. And indemnification
is an extension of that that says that one party will
... financially underwrite the loss of the other party
under certain circumstances.
The real issue here is not the sole negligence of the
two parties, but who's responsible when there's a
joint liability. The [Department of Transportation &
Public Facilities (DOT&PF)] takes a very fair approach
to this: They say that when there's joint liability,
it should be shared on a comparative fault basis. And
that's ... exactly what HB 151 requires. It's just
common sense ....
Unfortunately, not all public agencies have the same
approach as [DOT&PF]. Some agencies require their
consultant to take responsibility for all liability,
except for the agency's sole negligence. So, if the
agency is 99 percent at fault, the consultant still
pays 100 percent of the cost, because there's no
apportionment of cost on a comparative fault basis.
In the last six months, as an industry here in Alaska,
we have battled the Alaska Railroad, the University of
Alaska, ... the [Matanuska-Susitna (Mat-Su)] Borough,
and other public agencies on this issue. In all the
cases that we've faced, these agencies have demanded
that the consultant - and ... perhaps we could that
"professional services consultant" - ... assume 100
percent of the joint liability. The Alaska Railroad
even went so far as requiring indemnification, and I
quote, "from and against all claims and actions
asserted by a third party or parties resulting from
the services performed." This is just an absolutely
unlimited liability.
11:11:05 AM
It's not the public that is demanding these
liabilities. Whenever we've discussed it with the
Board of Regents or ... officers, assembly people,
project managers, they generally are looking for a
fair indemnification. But the problem we're facing
comes from contracting officers. And as contracting
officers change, so do the indemnification languages.
For example, in the Mat-Su Borough, they had a one-
sided indemnification that we battled through 2001,
and in 2002, they changed it to the [DOT&PF] format,
which lasted through all of last year. But now, they
have a new contracting officer; he scratched what we
battled for, and now we're back to the same old one-
sided language. So, you can see the problem. ...
This costs the [architects, engineers, and] land
surveyors in Alaska, and ultimately the public,
millions of dollars in wasted time every year as we
fight just to have fair contract language.
11:12:33 AM
... There are three major impacts that we experience.
Number one is that the contracts become uninsurable.
Our professional liability insurance only covers
damages to the extent caused by our negligence, but it
doesn't extend to the negligence of the other parties.
So, when we are required to carry all of the middle
ground, we're not insured. ... We had one insurance
agency tell us that we can get insurance for anything,
but we were looking at $2 million to pay for the
policy and a million dollar deductible. I think that
was an exaggeration, but I think you get the point.
The other thing that happens is that good consultants
walk away from agency work. Paradoxically, it's the
consultants that really understand risk that are in
the best position to help the owner with their
project, and yet it's these very same consultants who
won't sign in onerous languages. So, that leaves the
owner with consultants who can either make themselves
judgment proof - who are willing to take the risk but
then oftentimes will enter into defensive design
techniques to limit their risk - which causes project
prices to go up. The bottom line is there's no free
lunch.
And finally, we're forced to raise our prices. We do
this by capturing the millions of dollars of overhead
that we spend each year in our hourly rates, and we
also do that by increasing the prices in our contracts
to compensate for the additional risk.
MR. MORGENTHALER said [HB 151] follows the language successfully
used by DOT&PF for decades, will standardized indemnification
requirements for all public agencies, will level the playing
field, and is the fair, honest, and right thing to do.
11:14:51 AM
LEANNE BOLDENOW, Client Executive, Marsh USA, Inc., said that
company is an insurance brokerage that has represented
architects and engineers throughout Alaska for 10 years. She
stated:
It is very typical to have a contract presented to us
for insurability, and as we review the indemnification
clause, the requirements for the design professional
consultant to take on all liabilities, claims, and
hold harmless, we have to notify the design firm that
their professional liability insurance cannot take on
liabilities that are not directly connected to
[negligent acts, errors], and omissions. So, ... HB
151 specifically identifies that and would alleviate
this problem. So, I'm simply here today to support
the APDC and the bill, and I am also a member of the
APDC contract committee and do frequently witness
these contracts from their aspect in supporting that
these agency contracts are outside the design
professionals' professional liability.
11:16:33 AM
REPRESENTATIVE GRUENBERG described a situation in which the
legislature is asked to repeal or amend a statute because of
insurance problems - because insurance does not cover the
situation. He said he would hate for the legislature to pass HB
151 and have some insurance company somewhere say the new
language doesn't meet the mark. He asked Ms. Boldenow if she is
certain the language of the bill is sufficient.
MS. BOLDENOW responded, "The contracts that are causing the
issues are outside the insurance provisions. To bring them
inside, this bill does meet those requirements."
11:18:53 AM
REPRESENTATIVE GRUENBERG said when an action such as HB 151 is
taken, if an insurance company no longer wants to cover
something, than it will change its contract so that it does not.
He asked if there is anything else the legislature can do to
prevent that happening.
11:19:12 AM
MS. BOLDENOW replied that unfortunately insurance companies do
direct how business is conducted, but that is because of the
risk involved, and because those companies need to ensure they
make money. She stated that although she has "watched this" for
10 years, she does not have a crystal ball to look into to
predict what risk will transpire in the future.
REPRESENTATIVE GRUENBERG clarified that he is not pointing
fingers at anyone, and he acknowledged that everyone is doing
the best they can.
11:20:30 AM
CHAIR LYNN, after ascertaining that there was no one else to
testify, closed public testimony.
The committee took an at-ease from 11:21:17 AM to 11:21:37 AM.
11:21:42 AM
REPRESENTATIVE DOLL moved to report HB 151, Version 25-LS0479\E,
Bannister, 3/21/07, out of committee [with individual
recommendations and the accompanying fiscal notes]. There being
no objection CSHB 151(STA) was reported out of the House State
Affairs Standing Committee.
The committee took an at-ease from 11:22:06 AM to 11:25:35 AM.
HB 171-ACCOMMODATE 90-DAY SESSION
11:25:39 AM
CHAIR LYNN announced that the last order of business was HOUSE
BILL NO. 171, "An Act relating to the terms of legislators, the
date and time for convening regular legislative sessions,
adoption of uniform rules of the legislature and to certain of
those rules, the date for organizing the Legislative Budget and
Audit Committee, and deadlines for certain matters or reports to
be delivered to the legislature or filed; prohibiting bonuses
for legislative employees; and providing for an effective date."
[Before the committee was Version 25-LS0653\E, Cook, 3/16/07.]
CHAIR LYNN noted the complex nature of the bill and stated his
intent was not to pass it out of committee on this date.
11:26:52 AM
REPRESENTATIVE JOHNSON moved to adopt Amendment 1, labeled 25-
LS0653\E.2, Cook, 3/23/07, which read as follows:
Page 1, line 1:
Delete "the terms of legislators,"
Page 2, lines 16 - 22:
Delete all material.
Renumber the following bill sections accordingly.
Page 2, line 24, through page 3, line 2:
Delete all material and insert:
"Sec. 24.05.090. Duration of legislature;
[REGULAR] sessions. Each legislature has a duration of
approximately two years, and sessions consist of a
"First Regular Session" that meets in the odd-numbered
years, a "Second Regular Session" that meets in the
even-numbered years, and any special session that the
governor or the legislature calls. The legislature
shall convene at the capital for the First Regular
Session [EACH YEAR] on the second Monday in January at
1:00 p.m. [10:00 A.M.]; however, following a
gubernatorial election year, the legislature shall
convene on the third Tuesday in January at 1:00 p.m.
The legislature shall convene at the capital for the
Second Regular Session on the second Monday in
February at 1:00 p.m. [10:00 A.M. EXCEPT AS PROVIDED
IN THIS SECTION, EACH LEGISLATURE SHALL HAVE A
DURATION OF TWO YEARS AND SHALL CONSIST OF A "FIRST
REGULAR SESSION," WHICH SHALL MEET IN THE ODD-NUMBERED
YEARS, AND A "SECOND REGULAR SESSION," WHICH SHALL
MEET IN THE EVEN-NUMBERED YEARS, AND ANY SPECIAL
SESSION OR SESSIONS THAT THE GOVERNOR OR LEGISLATURE
MAY FIND NECESSARY TO CALL]."
Page 3, line 25:
Delete "February [JANUARY] 1"
Insert "January 1 preceding a First Regular
Session or at any time before February 1 preceding a
Second Regular Session"
Page 6, lines 2 - 3:
Delete all material.
Insert "governor's budget workbooks at least
seven days before the legislature convenes in a
regular session [BY THE FIRST MONDAY IN JANUARY OF
EACH YEAR, EXCEPT THAT FOLLOWING A GUBERNATORIAL
ELECTION YEAR"
Page 7, lines 27 - 30:
Delete all material.
Renumber the following bill section accordingly.
REPRESENTATIVE COGHILL objected [for discussion purposes].
REPRESENTATIVE JOHNSON explained that Amendment 1 would stagger
the starting date of the legislature. In the first term, the
legislature would start in January, and in the second term, it
would start in February. He said Amendment 1 would solve some
of the problems he has regarding the long lag time between the
election and the time a legislator is sworn in. He indicated
that it would also prevent the possibility of the governor
calling in lame duck legislators in January. Amendment 1 would
also solve problems related to when the budget must be
announced. He stated his belief that Amendment 1 lives up to
not only the intent of the law, but also the letter of the law,
and it would minimize the type of statute changes that would
have to be made "to accommodate all of the reportings in that
January session from the various administration departments."
11:29:31 AM
REPRESENTATIVE JOHNSON, in response to Representative Doll, said
the 90-day session would end in mid-April.
REPRESENTATIVE COGHILL asked if all the dates contemplated in
the bill are covered in Amendment 1.
REPRESENTATIVE JOHNSON said probably not; however, he said that
can be fleshed out and fine tuned by the committee.
REPRESENTATIVE COGHILL echoed that Amendment 1 addresses the
concern about a lame duck legislature being called into a
special session in January. He said he likes the idea of
starting the first regular session at "the regular time that we
have in January." He asked if Amendment 1 addresses the issue
of starting later for gubernatorial election years.
11:32:06 AM
REPRESENTATIVE JOHNSON said typically when a new governor enters
office, he/she needs the extra time to develop budgets, and he
said he would have all sessions start based upon the
gubernatorial schedule, whether or not it was a gubernatorial
election year.
11:33:03 AM
REPRESENTATIVE COGHILL said he likes that idea. He said he
thinks that starting the second session in February is
reasonable. Amendment 1 also provides for the consecutive-day
session, which he said the people of Alaska voted in favor of.
He said he cannot think of any problems regarding Uniform Rules,
although there may be some related issues to solve.
REPRESENTATIVE COGHILL removed his objection. He said, "I want
this in the bill conceptually."
11:34:15 AM
REPRESENTATIVE DOLL said she wonders why the legislature would
want to start in February every other year. She suggested that
doing so may complicate schedules and housing opportunities.
She asked what the advantage would be.
11:34:54 AM
REPRESENTATIVE JOHNSON said on a personal level, starting in
February gives him all of January with his family after the
holidays. Furthermore, it would move the legislature into
better weather later in the season, which would make traveling
back and forth better. He commented, "Juneau in May is pretty
nice."
11:36:26 AM
REPRESENTATIVE COGHILL noted another reason to move the start
date to February has to do with the timing of the budget
forecast. That second session, he noted, the legislature will
have already been organized, can meet outside of Juneau, and
will be better prepared when it meets. He concurred with the
"weather window" reason.
11:38:54 AM
REPRESENTATIVE JOHNSON revealed that he is a big supporter of a
biannual budget, and he point out that this type of schedule
sets the legislature up to be able to shift into that type of
budget planning.
11:39:40 AM
REPRESENTATIVE GRUENBERG said HB 125, which addresses long-range
fiscal planning, will be on the House floor soon. He stated his
strong support of Amendment 1.
11:40:47 AM
REPRESENTATIVE COGHILL restated that he removed his objection to
Amendment 1. There being no further objection, Amendment 1 was
adopted.
11:41:08 AM
REPRESENTATIVE GRUENBERG directed attention to a letter in the
committee packet, [dated March 22, 2007], from John Boucher.
11:41:56 AM
JOHN BOUCHER, Senior Economist, Office of the Director, Office
of Management & Budget (OMB), recalled that during the March 15
hearing on HB 171, Representative Coghill had requested that the
administration "talk specifically to the appointments of
commissioners and others." He said the administration did not
have a problem with an earlier submission of those names;
however, he said that was "presupposing that the session would
begin in February." With the adoption of Amendment 1, he noted,
there are two different schedules. He stated:
And so, in the January schedule we'd prefer to have
more time - in the February schedule it would be okay
to move it up - so that the governor would have
adequate time to look at these.
... We haven't contemplated all the dates, but
intuitively, what I'm thinking is we might have two
different types of schedules in an even and odd year.
... That may present some challenges; I'm certain that
they could be overcome with proper planning.
11:44:05 AM
REPRESENTATIVE GRUENBERG said he would like to see OMB propose
an amendment showing the dates it would prefer. He said he was
going to strike Section 17, but he will not do that at this
time.
11:44:44 AM
MR. BOUCHER said he would provide those dates. Regarding [the
adopted Amendment 1], he echoed Representative Coghill's
testimony about the revenue forecast. He said, "In my
perception of the value of having the revenue forecast later,
it's often in being able to know the current ... fiscal years'
numbers to the greatest extent possible, because at that point
in time you probably have 10 to 11 months-worth of actual data
for the current fiscal year, which can affect your thinking, in
terms of the amount of surplus available, et cetera."
11:45:34 AM
REPRESENTATIVE COGHILL said he is sensitive to the possibility
that requiring a list of new appointees from the administration
within 15 days may be tight, but the legislature has been given
the restraint of finishing its session in 90 days, and giving
the administration 30 days "goes into a big chunk of that
legislature." He asked Mr. Boucher to think along those terms.
He concluded, "Because if we get to the point where appointments
can't be made by the time a third of the legislature has been
spent, then ... I think we're going to run into some problems."
11:47:05 AM
REPRESENTATIVE JOHNSON said he only perceives this [requirement
of the administration] being a problem every four years, and
then only if a new governor is elected. He suggested that 15
days could work on most years, and 20 days could be set for
election years.
11:47:57 AM
REPRESENTATIVE GRUENBERG said he would like the right to offer
an amendment at a later hearing.
11:48:25 AM
REPRESENTATIVE COGHILL said one topic to consider as an
amendment to the bill would be to insert a sunset date, because
he said the issue needs to be revisited. He said the big policy
call is whether or not the public was right in passing the 90-
day initiative. Another issue for a possible amendment is
related to changes to the Uniform Rules proposed by
Representative Norman Rokeberg in a prior legislature. He
indicated that one rule has to do with [legislators being
present during a vote to move a bill out of committee in order
for their vote to count]. He said he would ensure committee
members received the information pertaining to Representative
Rokeberg's resolution. He noted that Alaska has several public
corporations, and it has gas and oil issues that demand
immediate attention and require policy calls, which tie into the
issue of having to be present to vote. He stated that there are
problems with the Uniform Rules and statute. He said, "I hope
that I can present them a little better when we get to it."
11:52:22 AM
REPRESENTATIVE DOLL said she thinks the public sees the rush of
the last 30 days of session, but it does not understand what it
is that the legislature does for the first 15-20 days, which is
why she welcomes this type of discussion.
CHAIR LYNN echoed Representative Doll's comment about how
obvious the rush at the end of session is. He said a lot of
work goes on behind the scenes. He remarked that there is no
such thing as a simple bill; every bill is controversial to
somebody and requires time to address.
11:54:48 AM
REPRESENTATIVE GRUENBERG said HB 171 is a very unusual bill that
will have a profound effect on the legislature, and he said he
has not seen another like it in the time that he has served in
the legislature. He said that it is a blessing to have both the
chair of the House State Affairs Standing Committee and the
chair of the House Rules Standing Committee involved. He stated
that it is seldom that the legislature examines its own process;
HB 109 - the ethics bill - is another such example. The way the
legislature conducts business in a 90-day session and how it
works during the interim will have profound effects on many
people around state. He expressed appreciation for the fact
that the legislature is addressing this issue.
11:57:05 AM
REPRESENTATIVE COGHILL said another issue to address will be
that of interim per diem. He said it is called a stipend, but
it is meant as pay in recognition that a legislator gives up a
portion of his/her day in which he/she would otherwise be
gainfully employed. He said, "I have a feeling this will push
the tension on that to the point that we'll have to address it."
11:58:15 AM
CHAIR LYNN offered the analogy of the apple cart that has been
tipped over. He said, "What we're doing right now is picking up
apples one at a time, and trying to put them back in ... the
cart."
11:58:42 AM
CHAIR LYNN announced that HB 171 was heard and held.
ADJOURNMENT
There being no further business before the committee, the House
State Affairs Standing Committee meeting was adjourned at
11:58:58 AM.
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