Legislature(1993 - 1994)

03/08/1994 08:00 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                          March 8, 1994                                        
                            8:00 a.m.                                          
                                                                               
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
  Representative Al Vezey, Chairman                                            
  Representative Pete Kott, Vice Chairman                                      
  Representative Bettye Davis                                                  
  Representative Gary Davis                                                    
  Representative Harley Olberg                                                 
  Representative Jerry Sanders                                                 
                                                                               
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
  Representative Fran Ulmer                                                    
                                                                               
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
  HB 328:        "An Act relating to motor vehicle                             
                 registration and registration fees; to fees                   
                 for drivers' licenses and permits; and                        
                 providing for an effective date."                             
                                                                               
                 PASSED OUT OF COMMITTEE                                       
                                                                               
  SB 186:        "An Act relating to state agency                              
                 publications."                                                
                                                                               
                 PASSED OUT OF COMMITTEE                                       
                                                                               
  *HJR 60:       Relating to an amendment to the Constitution                  
                 of the United States prohibiting federal                      
                 courts from ordering a state or a political                   
                 subdivision of a state to increase or impose                  
                 taxes.                                                        
                                                                               
                 PASSED OUT OF COMMITTEE                                       
                                                                               
  *HB 402:       "An Act requiring that an owner's motor                       
                 vehicle liability insurance policy used as                    
                 proof of financial responsibility designate                   
                 by description or appropriate reference the                   
                 motor vehicles it covers; and providing for                   
                 an effective date."                                           
                                                                               
                 PASSED OUT OF COMMITTEE                                       
                                                                               
  HB 403:        "An Act requiring that automobile liability                   
                 insurance include coverage for uninsured or                   
                 underinsured motor vehicles and an offer of                   
                 policy limits for that coverage equal to                      
                 coverage voluntarily purchased for bodily                     
                 injury or death; and providing for an                         
                 effective date."                                              
                                                                               
                 PASSED 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."                                           
                                                                               
                 HELD OVER                                                     
                                                                               
  HB 405:        "An Act establishing and relating to the                      
                 Alaska Information Network Corporation;                       
                 relating to the Telecommunications                            
                 Information Council; and                                      
                 relating to the state's information industry;                 
                and providing for an effective date."                          
                                                                               
                 NOT HEARD                                                     
                                                                               
  *HB 347:       An Act relating to long-term plans of certain                 
                 state agencies."                                              
                                                                               
                 NOT HEARD                                                     
                                                                               
                                                                               
  WITNESS REGISTER                                                             
                                                                               
  REPRESENTATIVE STEVE FRANK                                                   
  Alaska State Legislature                                                     
  Alaska State Capitol, Room 518                                               
  Juneau, AK  99811-0460                                                       
  Phone:  465-3709                                                             
  POSITION STATEMENT:  Prime sponsor of SB 186                                 
                                                                               
  REPRESENTATIVE BILL HUDSON                                                   
  Chairman Labor & Commerce Committee                                          
  Alaska State Legislature                                                     
  Alaska State Capitol, Room 108                                               
  Juneau, AK  99811-0460                                                       
  Phone:  465-3744                                                             
  POSITION STATEMENT:  Sponsor of HB 402 and HB 403                            
                                                                               
  DENNIS BROWN                                                                 
  Alaska Independent Insurance Agents & Brokers                                
  1311 Summit Dr.                                                              
  Fairbanks, AK  99712                                                         
  Phone: 457-3268                                                              
  POSITION STATEMENT:  Testified on HB 402 and HB 403                          
                                                                               
  HOWARD JAEGER                                                                
  Shattuck & Grummett Insurance                                                
  Member, Independent Insurance Agents & Brokers of Alaska                     
  9110 Mendenhall Mall Rd.                                                     
  Juneau, AK  99801                                                            
  Phone:  789-3005                                                             
  POSITION STATEMENT:  Supported HB 402 and HB 403                             
                                                                               
  JOHN GEORGE                                                                  
  National Association of Independent Insurers                                 
  9515 Moraine Way                                                             
  Juneau, AK  99801                                                            
  Phone:  789-0172                                                             
  POSITION STATEMENT:  Supported HB 402 and HB 403                             
                                                                               
  JEANNETTE JAMES                                                              
  Alaska State Legislature                                                     
  Alaska State Capitol, Room 501                                               
  Juneau, AK  99811-0460                                                       
  Phone:  465-3743                                                             
  POSITION STATEMENT:  Prime sponsor of HB 345                                 
                                                                               
  PREVIOUS ACTION                                                              
                                                                               
  BILL:  HB 328                                                                
  SHORT TITLE: BIENNIAL VEHICLE REGISTRATION                                   
  SPONSOR(S): REPRESENTATIVE(S) MARTIN,BARNES,Phillips,B.Davis                 
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  01/03/94      2013    (H)   PREFILE RELEASED                                 
  01/10/94      2013    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  01/10/94      2013    (H)   STATE AFFAIRS, FINANCE                           
  01/13/94      2054    (H)   COSPONSOR(S):  B. DAVIS                          
  01/22/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  01/22/94              (H)   MINUTE(STA)                                      
  01/29/94              (H)   MINUTE(STA)                                      
  02/08/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  02/08/94              (H)   MINUTE(STA)                                      
  03/01/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  03/01/94              (H)   MINUTE(STA)                                      
  03/05/94              (H)   MINUTE(STA)                                      
  03/08/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  BILL:  SB 186                                                                
  SHORT TITLE: STATE AGENCY PUBLICATIONS                                       
  SPONSOR(S): SENATOR(S) FRANK                                                 
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  04/07/93      1221    (S)   READ THE FIRST TIME/REFERRAL(S)                  
  04/07/93      1221    (S)   STATE AFFAIRS                                    
  04/14/93      1354    (S)   STA RPT  3DP                                     
  04/14/93      1354    (S)   ZERO FISCAL NOTE (ADM)                           
  04/14/93              (S)   STA AT 9:00 AM BUTROVICH RM 205                  
  04/14/93              (S)   MINUTE(STA)                                      
  04/14/93              (S)   MINUTE(RLS)                                      
  04/26/93      1761    (S)   RULES 4 CALENDAR   4/26/93                       
  04/26/93      1762    (S)   READ THE SECOND TIME                             
  04/26/93      1762    (S)   AM NO  1  ADOPTED UNAN CONSENT                   
  04/26/93      1763    (S)   AM NO  2  ADOPTED UNAN CONSENT                   
  04/26/93      1764    (S)   AM NO  3  FAILED  Y10 N10                        
  04/26/93      1764    (S)   ADVANCE TO THIRD READING FAILED                  
                              Y11 N9                                           
  04/26/93      1764    (S)   THIRD READING 4/27 CALENDAR                      
  04/27/93      1842    (S)   READ THE THIRD TIME  SB 186 AM                   
  04/27/93      1842    (S)   PASSED Y20 N-                                    
  04/27/93      1842    (S)   DONLEY NOTICE OF                                 
                              RECONSIDERATION                                  
  04/28/93      1891    (S)   RECONSIDERATION NOT TAKEN UP                     
  04/28/93      1893    (S)   TRANSMITTED TO (H)                               
  05/06/93      1661    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  05/06/93      1661    (H)   L&C, STATE AFFAIRS, JUDICIARY,                   
                              FINANCE                                          
  02/17/94              (H)   L&C AT 03:00 PM CAPITOL 17                       
  02/17/94              (H)   MINUTE(L&C)                                      
  02/18/94      2455    (H)   L&C RPT  5DP                                     
  02/18/94      2455    (H)   DP:PORTER,SITTON,MULDER,GREEN,                   
                              HUDSON                                           
  02/18/94      2455    (H)   -ZERO FISCAL NOTE (ADM) 2/18/94                  
  03/05/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  03/05/94              (H)   MINUTE(STA)                                      
                                                                               
  BILL:  HJR 60                                                                
  SHORT TITLE: AMEND US CONSTIT. TO LIMIT FED. COURTS                          
  SPONSOR(S): STATE AFFAIRS                                                    
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  02/28/94      2550    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/28/94      2550    (H)   STATE AFFAIRS, JUDICIARY                         
  03/08/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  BILL:  HB 402                                                                
  SHORT TITLE: PROOF OF MOTOR VEHICLE INSURANCE                                
  SPONSOR(S): LABOR & COMMERCE                                                 
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  01/26/94      2155    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  01/26/94      2155    (H)   STATE AFFAIRS                                    
  03/08/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  BILL:  HB 403                                                                
  SHORT TITLE: AUTOMOTIVE LIABILITY INSURANCE COVERAGE                         
  SPONSOR(S): LABOR & COMMERCE                                                 
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  01/26/94      2155    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  01/26/94      2155    (H)   LABOR & COMMERCE, STATE AFFAIRS                  
  02/03/94              (H)   L&C AT 03:00 PM CAPITOL 17                       
  02/03/94              (H)   MINUTE(L&C)                                      
  02/22/94              (H)   L&C AT 03:00 PM CAPITOL 17                       
  02/22/94              (H)   MINUTE(L&C)                                      
  02/23/94      2494    (H)   L&C RPT  4DP 2NR                                 
  02/23/94      2494    (H)   DP:  PORTER, SITTON, MULDER,                     
                              HUDSON                                           
  02/23/94      2494    (H)   NR:  WILLIAMS, GREEN                             
  02/23/94      2494    (H)   -ZERO FISCAL NOTE (DCED) 2/23/94                 
  03/08/94              (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                      
                                                                               
  BILL:  HB 405                                                                
  SHORT TITLE: CREATE ALASKA INFORMATION NETWORK CORP                          
  SPONSOR(S): REPRESENTATIVE(S) KOTT,Hudson,Brown,                             
  Hoffman,Davies,Williams                                                      
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  01/26/94      2155    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  01/26/94      2156    (H)   STATE AFFAIRS, JUDICIARY                         
  02/22/94      2485    (H)   COSPONSOR DELETED:  GREEN                        
  03/01/94              (H)   STA AT 08:00 AM CAPITOL 102                      
  03/02/94      2588    (H)   COSPONSOR(S):  WILLIAMS                          
  03/08/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  BILL:  HB 347                                                                
  SHORT TITLE: STATE LONG-TERM PLANNING                                        
  SPONSOR(S):REPRESENTATIVE(S) PARNELL,Hanley,Therriault,                      
  B.Davis,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      2019    (H)   STATE AFFAIRS, FINANCE                           
  01/12/94      2043    (H)   COSPONSOR(S): THERRIAULT                         
  01/13/94      2056    (H)   COSPONSOR(S):  B. DAVIS                          
  01/14/94      2084    (H)   COSPONSOR(S):  JAMES                             
  03/08/94              (H)   STA AT 08:00 AM CAPITOL 102                      
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 94-24, SIDE A                                                           
  Number 000                                                                   
                                                                               
  CHAIRMAN VEZEY called the meeting to order and 8:00 a.m.                     
  Members present were REPRESENTATIVES KOTT, SANDERS, and                      
  OLBERG.                                                                      
                                                                               
  Number 016                                                                   
  HB 328 - BIENNIAL VEHICLE REGISTRATION                                       
                                                                               
  CHAIRMAN VEZEY opened discussion on HB 328 under bills                       
  previously heard.                                                            
                                                                               
  REPRESENTATIVE PETE KOTT moved that previous action on HB
  328 be rescinded, and be taken up for immediate                              
  consideration.                                                               
                                                                               
  Hearing no objection, CHAIRMAN VEZEY rescinded the previous                  
  action on HB 328.  He announced the committee had before                     
  them CSHB 328, version R, which the committee had already                    
  adopted.  The committee amended version R on page 6, line                    
  22, and on page 10, line 24, to read "biennial", instead of                  
  "annual."                                                                    
                                                                               
  CSHB 328:  "An Act relating to motor vehicle registration                    
  and registration fees, and to the optional municipal motor                   
  vehicle registration tax; to fees for drivers' licenses and                  
  permits; to fees related to inspection and control of motor                  
  vehicle emissions; and providing for an effective date."                     
                                                                               
  REPRESENTATIVE KOTT felt CSHB 328, version R, was a good                     
  bill and it should not be held up by the State Affairs                       
  Committee.  The financial ramifications would be taken up by                 
  the Finance Committee.                                                       
                                                                               
  REPRESENTATIVE KOTT moved CSHB 328, version R, be passed                     
  from committee with individual recommendations.                              
                                                                               
  Number 053                                                                   
                                                                               
  CHAIRMAN VEZEY asked the committee secretary to call the                     
  roll and CSHB 328, version R, passed from the House State                    
  Affairs Committee with individual recommendations.                           
                                                                               
  (REPRESENTATIVE G. DAVIS joined the meeting at 8:03 a.m.)                    
                                                                               
  SB 186 - STATE AGENCY PUBLICATIONS                                           
                                                                               
  CHAIRMAN VEZEY opened SB 186 for discussion under bills                      
  previously heard.                                                            
                                                                               
  Number 070                                                                   
                                                                               
  SENATOR STEVE FRANK, PRIME SPONSOR OF SB 186, addressed the                  
  bill.  He stated a few years ago there was a bill which                      
  would have required agencies to put the cost of their                        
  publications on the publications.  This procedure was                        
  intended to discourage those agencies from printing                          
  expensive high gloss publications, and return them to the                    
  use of a copier.  He stated the amended bill, however,                       
  returned to the Senate from the House stating there should                   
  be a preference for printing materials in state operated                     
  facilities.  He stated this provision upset the private                      
  sector because the University and the state would now be                     
  providing services that should be provided by the private                    
  sector.  The language found in SB 186 is from former                         
  REPRESENTATIVE DAVE CHOQUETTE's bill which did not make it                   
  through the system.  He felt SB 186 would correct the wrong                  
  doing by the past amended bill.                                              
                                                                               
  (REPRESENTATIVE B. DAVIS joined the meeting at 8:05 a.m.)                    
  Number 111                                                                   
                                                                               
  CHAIRMAN VEZEY announced the arrival of REPRESENTATIVES G.                   
  DAVIS and B. DAVIS, and asked if they would like to sign the                 
  committee report on CSHB 328.                                                
                                                                               
  CHAIRMAN VEZEY stated he had requested a House committee                     
  substitute to SB 186 which he had discussed with SENATOR                     
  FRANK.  From the original SB 186, all of the language on                     
  line 11, page 1, would be deleted.  The House committee                      
  substitute would read on page 1, beginning on line 10, "The                  
  standards shall also be designed to promote the maximum use                  
  of private sector printing facilities located in the state."                 
                                                                               
  Number 158                                                                   
                                                                               
  REPRESENTATIVE HARLEY OLBERG asked the letter designation of                 
  the House Committee Substitute.                                              
                                                                               
  CHAIRMAN VEZEY clarified the House CS for SB 186 was version                 
  J.  He pointed out another change to page 1, line 5 to SB
  186.  After the word "practicable", the clause,"or if at                     
  least three businesses in the state are capable of producing                 
  the publication," was added.  This addition helps delineate                  
  the definition of "practicable."                                             
                                                                               
  Number 180                                                                   
                                                                               
  SENATOR FRANK commented he did not have a problem with this                  
  amendment when first mentioned; however, he did now believe                  
  there were printing facilities in the state, with unique                     
  capabilities, with only one or two competitors.  He felt the                 
  requirement of three may be too much.                                        
                                                                               
  CHAIRMAN VEZEY stated three would not be a minimum, but if                   
  there were three facilities it would be determined                           
  practicable to contract the printing out.                                    
                                                                               
  SENATOR FRANK explained that for the high quality work,                      
  there may be only one or two facilities in the state capable                 
  of producing it.                                                             
                                                                               
  Number 193                                                                   
                                                                               
  CHAIRMAN VEZEY emphasized the wording states, "when                          
  practicable, OR if at least three businesses in the state                    
  are capable..."  He interpreted the House CS to mean if                      
  there are three facilities capable of doing the work, it                     
  will be de facto, determined to be practicable.                              
                                                                               
  Number 202                                                                   
                                                                               
  SENATOR FRANK wanted to make sure the language was clear.                    
                                                                               
  Number 207                                                                   
                                                                               
  REPRESENTATIVE JERRY SANDERS felt if there were three bids                   
  the state would get a fair price, and if there is only one,                  
  the contract needs to be bid outside the state.                              
                                                                               
  Number 214                                                                   
                                                                               
  SENATOR FRANK felt he and the committee had the same intent;                 
  however, the language must be correct.                                       
                                                                               
  Number 220                                                                   
                                                                               
  CHAIRMAN VEZEY commented SB 186 could be brought back up                     
  later if SENATOR FRANK would like more time.                                 
                                                                               
  Number 221                                                                   
                                                                               
  SENATOR FRANK felt the House CS was fine, as long as the                     
  approach would be the maximum use of the private sector.                     
                                                                               
  CHAIRMAN VEZEY responded it was not the intent of the House                  
  CS to distort the intent of the original SB 186.                             
                                                                               
  SENATOR FRANK wanted to be careful the House CS did not end                  
  up being confusing.                                                          
                                                                               
  Number 277                                                                   
                                                                               
  CHAIRMAN VEZEY believed SB 186 had a Judiciary Committee                     
  referral and REPRESENTATIVE KOTT would be on that committee                  
  to follow the bill and correct any mistakes if found.                        
                                                                               
  CHAIRMAN VEZEY asked if there was a motion to adopt the                      
  House committee substitute for SB 186.                                       
                                                                               
  REPRESENTATIVE SANDERS so moved.                                             
                                                                               
  Number 283                                                                   
                                                                               
  Hearing no objection, CHAIRMAN VEZEY announced the House                     
  committee substitute to SB 186 was adopted.                                  
                                                                               
  Number 285                                                                   
                                                                               
  REPRESENTATIVE GARY DAVIS moved to pass House Committee                      
  Substitute for SB 186 from committee with individual                         
  recommendations.                                                             
                                                                               
  CHAIRMAN VEZEY recognized the motion and asked the committee                 
  secretary to call the roll.  Hearing no objection, HCSSB 186                 
  passed from the House State Affairs Committee.                               
                                                                               
  HJR 60 - AMEND U.S. CONSTITUTION TO LIMIT FEDERAL COURTS                     
                                                                               
  CHAIRMAN VEZEY opened HJR 60, sponsored by the State Affairs                 
  Committee, for discussion.  REPRESENTATIVE SKAGGS, HOUSE OF                  
  REPRESENTATIVES in MISSOURI, requested HJR 60.                               
                                                                               
  CHAIRMAN VEZEY addressed HJR 60 as a resolution asking the                   
  Congress of the Unites States to prepare and present to the                  
  legislature of all the states, an amendment to the                           
  Constitution of the United States.  This amendment would                     
  prohibit a federal court from ordering a state or political                  
  subdivision of a state, to increase or impose taxes.  He                     
  noted HJR 60 would not have the power of law; it is simply a                 
  resolution.                                                                  
                                                                               
  Number 334                                                                   
                                                                               
  REPRESENTATIVE KOTT felt HJR 60 was a good resolution.  The                  
  resolution addressed mandates and the resolve clauses are                    
  verbatim, per REPRESENTATIVE SKAGGS' suggestions.                            
                                                                               
  CHAIRMAN VEZEY commented 26 states have already issued                       
  resolutions similar to HJR 60.                                               
                                                                               
  REPRESENTATIVE G. DAVIS did not have a problem with the                      
  concept, but would like an example of the concern.  He said                  
  it appeared that the federal courts were looking at ordering                 
  the imposition or increase of taxes, but when questioned the                 
  judges turned them away.                                                     
                                                                               
  CHAIRMAN VEZEY replied there are Supreme Court decisions                     
  specifically stating they have the right to impose or                        
  increase the taxes.                                                          
                                                                               
  Number 353                                                                   
                                                                               
  REPRESENTATIVE OLBERG looked to the second page of                           
  REPRESENTATIVE SKAGGS letter which states, "the Federal                      
  District Court, with the blessing of the United States                       
  Supreme Court, continues to order property tax increases..."                 
  for a specific purpose.                                                      
                                                                               
  Number 365                                                                   
                                                                               
  REPRESENTATIVE KOTT moved to pass HJR 60 from committee with                 
  individual recommendations, asking unanimous consent.                        
                                                                               
  CHAIRMAN VEZEY asked the committee secretary to call the                     
  roll, and HJR 60 passed unanimously from the House State                     
  Affairs Committee with individual recommendations.                           
                                                                               
  HB 402 - PROOF OF MOTOR VEHICLE INSURANCE                                    
                                                                               
  CHAIRMAN VEZEY opened discussion on HB 402.  The sponsor of                  
  HB 402 is the House Labor & Commerce Committee.                              
                                                                               
  Number 383                                                                   
                                                                               
  REPRESENTATIVE BILL HUDSON, CHAIRMAN, HOUSE LABOR & COMMERCE                 
  COMMITTEE, addressed HB 402.  He stated HB 402 deals with                    
  proof of financial responsibility filings for SR-22 drivers.                 
  SR-22 filings are, in many instances, needed for those who                   
  have been convicted of driving while intoxicated or reckless                 
  driving.  He thought HB 402 would provide insurance                          
  companies the necessary information that would ultimately                    
  lead to lowered premiums.  All drivers would begin to be                     
  treated with some equity.  He noted HB 402 essentially                       
  provides that insurance companies be informed as to what                     
  vehicles they are insuring. Presently, drivers can get                       
  insurance for inexpensive cars, drive and wreck expensive                    
  cars, and the insurance companies are being asked to pay the                 
  cost for the higher cost vehicle.  HB 402 would provide a                    
  clear definition for the insurance companies as to what they                 
  are insuring.                                                                
                                                                               
  CHAIRMAN VEZEY moved to the Fairbanks teleconference site.                   
                                                                               
  Number 431                                                                   
                                                                               
  DENNIS BROWN, ALASKA INDEPENDENT INSURANCE AGENTS & BROKERS,                 
  testified in favor of HB 402.  Presently, an offender of a                   
  crime such as driving while intoxicated must provide, to                     
  continue driving, verification of coverage by the means of                   
  an SR-22.  The insurance carrier affirms that the liability                  
  coverage has been in place, and if the policy is cancelled                   
  for any reason, the Department of Financial Responsibility                   
  will be so notified.  A standard family auto policy has to                   
  list their private passenger automobiles by make, year,                      
  value, etc...  This policy is very specific and it does                      
  include an allowance for driving other vehicles, which meet                  
  specific requirements.                                                       
                                                                               
  MR. BROWN felt an underwriter needs to list specific                         
  vehicles on policies to give them some idea of the uses,                     
  age, and potentiality of loss.  An underwriter for SR-22                     
  relating to private passenger automobiles comes into                         
  problems when an SR-22 driver is found driving commercial                    
  heavy equipment or heavy trucks, substantially raising the                   
  rate of coverage required.  The SR-22 filing requirement                     
  does not provide specific interpretation of what the driver                  
  can drive, therefore, a driver could drive a Ford Taurus or                  
  an International tractor or trailer.                                         
                                                                               
  MR. BROWN stated HB 402 amends SR-22 statutes only to cover                  
  those autos listed in the policy, that meet the definition                   
  of a private passenger automobile.  He emphasized the                        
  policies that fit these automobiles should be listed.                        
  Carriers have been getting reluctant to write SR-22 coverage                 
  in Alaska.                                                                   
                                                                               
  CHAIRMAN VEZEY asked MR. BROWN to explain what an SR-22 is.                  
                                                                               
  MR. BROWN explained an SR-22 is a verification of coverage.                  
  For example, if an indicted driving while intoxicated                        
  offender wanted to regain his/her license, an insurance                      
  policy must be secured that the insurance carrier is willing                 
  to submit an SR-22 to the Department of Financial                            
  Responsibility that verifies the insurance is in effect.                     
                                                                               
  CHAIRMAN VEZEY asked if commercial vehicles had to be listed                 
  individually under current laws.                                             
                                                                               
  MR. BROWN said yes, and most commercial auto policies                        
  require there be a listing of commercial vehicles.                           
                                                                               
  Number 509                                                                   
                                                                               
  CHAIRMAN VEZEY introduced HOWARD JAEGER as the next                          
  individual to testify in Juneau.                                             
                                                                               
  Number 514                                                                   
                                                                               
  HOWARD JAEGER, SHATTUCK & GRUMMETT INSURANCE, MEMBER                         
  INDEPENDENT INSURANCE AGENTS & BROKERS OF ALASKA, testified                  
  in favor of HB 402.  He pointed out, presently in the                        
  preferred auto program, the preferred driver has to specify                  
  which vehicles they want insured.  If they buy another                       
  vehicle they have 30 days to notify the insurance carrier in                 
  order for coverage to apply to it.  After 30 days, coverage                  
  would not apply to that car.  The 1989 bill addressing SR-22                 
  filings was broadened to include all motor vehicles owned by                 
  that person, not specifying the 30 day notice period.  With                  
  HB 402, coverage would apply to all vehicles which the                       
  insured has notified the insurance company that they own.                    
                                                                               
  Number 534                                                                   
                                                                               
  REPRESENTATIVE SANDERS asked if HB 402 would affect the                      
  premiums an individual would pay for an SR-22 policy.                        
                                                                               
  Number 537                                                                   
                                                                               
  MR. JAEGER said yes.  Currently, only one car has to be                      
  notified and insured with an agency, but the person could                    
  then drive other vehicles, without notifying the carrier.                    
  If the person then wrecked, the carrier would have to pay                    
  the claim even if they have not collected a premium for the                  
  other vehicles.                                                              
                                                                               
  Number 546                                                                   
                                                                               
  REPRESENTATIVE SANDERS inquired if all of the cars insured                   
  under the one driver would be at the higher SR-22 rate.                      
                                                                               
  Number 548                                                                   
                                                                               
  MR. JAEGER said no, only the first car would be higher.  The                 
  additional cars would have to be added to the SR-22 policy                   
  though.  He stated if a person had a speeding ticket and an                  
  accident the agency would only charge the surcharge on the                   
  one car.                                                                     
                                                                               
  Number  555                                                                  
                                                                               
  REPRESENTATIVE SANDERS commented with the new .08 alcohol                    
  limit there will be a lot of very responsible Alaskans                       
  paying SR-22 insurance.  He stated if HB 402 would make                      
  these people pay extra premiums on all their other vehicles                  
  then he would not be in favor of it.                                         
                                                                               
  Number 562                                                                   
                                                                               
  MR. JAEGER explained individuals with SR-22 would not be                     
  able to stay in a preferred market; therefore, they would                    
  have to pay the extra premiums.  SR-22 individuals would go                  
  into a substandard market, which is automatically a                          
  surcharge market on all of their cars.  In terms of their                    
  driving record, the agency would charge the surcharge on                     
  their first vehicle for the DWI and the others would act as                  
  second cars on which there would not be surcharge.                           
                                                                               
  CHAIRMAN VEZEY clarified HB 402 would also lower the cost of                 
  an SR-22 policy for a one vehicle owner, because as it is                    
  now, multiple vehicle owners were being lumped together with                 
  single vehicle owners.                                                       
                                                                               
  Number 573                                                                   
                                                                               
  MR. JAEGER said yes, multiple vehicle owners could be mixed                  
  together with single vehicle owners without the companies                    
  knowing it.                                                                  
                                                                               
  Number 575                                                                   
                                                                               
  CHAIRMAN VEZEY said the company's exposure is currently very                 
  high and they are not very willing to write SR-22 policies.                  
  He felt the competition may not be very stiff.                               
                                                                               
  Number 578                                                                   
                                                                               
  MR. JAEGER replied the competition is not very stiff now,                    
  but HB 402 may help encourage other companies to come into                   
  the state and offer SR-22 insurance.                                         
                                                                               
  Number 580                                                                   
                                                                               
  REPRESENTATIVE OLBERG wondered why the old language of June                  
  6, 1989, was not used in HB 402 which states, "applicable to                 
  all owned vehicles insured by the consignatary."  He asked                   
  why the language in HB 402 is more preferable.                               
                                                                               
  Number 586                                                                   
                                                                               
  MR. JAEGER responded the drafters were trying to say the                     
  same thing in different language by stating, "designated by                  
  description or appropriate reference, the motor vehicle that                 
  it covers."  The old law stated, "applicable to all owned                    
  vehicles insured by the insurance company."  He felt HB 402                  
  could read as it used to.                                                    
                                                                               
  Number 593                                                                   
                                                                               
  REPRESENTATIVE KOTT believed the language in HB 402 was                      
  legally the correct language of today.  He asked how many                    
  SR-22's were in the state.                                                   
                                                                               
  MR. JAEGER did not know.                                                     
                                                                               
  REPRESENTATIVE SANDERS wanted to clarify the answer to his                   
  previous question.  He asked if a person, who owns three                     
  cars, were to receive a DWI he/she would only have to pay                    
  that higher premium on one car, not all three.                               
                                                                               
  MR. JAEGER confirmed REPRESENTATIVE SANDERS.                                 
                                                                               
  Number 607                                                                   
                                                                               
  CHAIRMAN VEZEY introduced JOHN GEORGE as the next individual                 
  to testify.                                                                  
                                                                               
  JOHN GEORGE, NATIONAL ASSOCIATION OF INDEPENDENT INSURERS                    
  (NAII), testified in favor HB 402.  The reason people have                   
  to have an SR-22 filing is because they have run afoul of                    
  the law; caught driving without insurance, driving while                     
  intoxicated, or involved in a serious accident.  The state                   
  wants to ensure, with an SR-22, that these people are now in                 
  compliance and have automobile insurance.  MR. GEORGE                        
  pointed out SR-22 is a requirement of the state.  Current                    
  laws require insurance companies to verify, if an individual                 
  is driving a car, that he/she is insured.  Therefore, if an                  
  individual owns ten cars and only has insured one of them                    
  with the company, but gets in a wreck in one of the other                    
  cars, the insurance company still has to pay the client's                    
  claim.  He clarified HB 402 would allow the insurance                        
  companies to pay claims on any car they insure, and only the                 
  cars described on the form.                                                  
                                                                               
  Number 641                                                                   
                                                                               
  REPRESENTATIVE OLBERG asked why cars were insured, instead                   
  of drivers.                                                                  
                                                                               
  Number 642                                                                   
                                                                               
  MR. GEORGE responded drivers can be insured, but not many                    
  companies offer that type of owner's policy.  A problem                      
  arises when an insured driver lends his/her uninsured car to                 
  another individual.  The car would only then be insured if                   
  the other driver had liability insurance.                                    
                                                                               
  CHAIRMAN VEZEY asked the pleasure of the committee.                          
                                                                               
  Number 655                                                                   
                                                                               
  REPRESENTATIVE BETTYE DAVIS moved to pass HB 402 from                        
  committee with individual recommendations.                                   
                                                                               
  Number 662                                                                   
                                                                               
  CHAIRMAN VEZEY asked the committee secretary to call the                     
  roll, and HB 402 passed unanimously from the House State                     
  Affairs Committee with individual recommendations.                           
                                                                               
  HB 403 - AUTOMOTIVE LIABILITY INSURANCE COVERAGE                             
                                                                               
  CHAIRMAN VEZEY opened HB 403 for discussion.  The House                      
  Labor & Commerce Committee sponsored HB 403.                                 
                                                                               
  Number 677                                                                   
                                                                               
  REPRESENTATIVE BILL HUDSON, CHAIRMAN HOUSE LABOR & COMMERCE,                 
  addressed HB 403.  Legislation passed in 1992 requires                       
  insurance companies to offer uninsured and underinsured                      
  motorist coverage in excess of voluntarily purchased                         
  coverage by the insurer.  He explained on current insurance                  
  forms there is a signed statement on the back which states                   
  one has turned down the higher limits required by law to be                  
  offered to you.  He stated HB 403 was introduced to remove                   
  the mandatory offer of higher insurance limits.  Alaska is                   
  the only state in the Nation which requires uninsured and                    
  underinsured motorist coverage of up to $2 million.  AS                      
  21.89.020 would be amended to require coverage that includes                 
  policy limits equal to the limit voluntarily purchased.  He                  
  felt, with the passage of HB 403, there would be greater                     
  competition because companies which could not offer those                    
  higher limits would be enticed to join the market.                           
                                                                               
  TAPE 94-24, SIDE B                                                           
  Number 000                                                                   
                                                                               
  CHAIRMAN VEZEY asked any future witness to answer if there                   
  was any advantage to an individual purchasing insurance                      
  limits that exceed their net assets.                                         
                                                                               
  CHAIRMAN VEZEY asked DENNIS BROWN if he would again like to                  
  testify on HB 403.                                                           
                                                                               
  Number 042                                                                   
                                                                               
  DENNIS BROWN, ALASKA INDEPENDENT INSURANCE AGENTS & BROKERS,                 
  testified in favor of HB 403.  They would like a healthy                     
  competitive insurance market in the state to provide better                  
  prices and coverage for the consumers.  HB 403 would make                    
  only minimum requirements, and the actually extension of                     
  coverage is a decision made by purchaser of insurance.  He                   
  stated HB 403 would not remove the provisions for uninsured                  
  and underinsured motorists, but rather change the limits of                  
  coverage.  If a purchaser decides to purchase $500,000 of                    
  insurance for third party liability, injuries or damages to                  
  others, the same limits should be available as under the                     
  underinsured and uninsured motorists.  He felt the coverage                  
  should not be in excess of what the purchaser bought for                     
  liability.  MR. BROWN emphasized automotive liability                        
  coverage is mandated in the state of Alaska, and as such it                  
  should be affordable and attainable.  He pointed out the low                 
  population and high cost of doing business in Alaska creates                 
  a limited and secluded market for those in insurance.                        
  Alaska does not develop the large premium dollars to attract                 
  underwriters.  He said Alaska is usually the last state a                    
  company enters and the first state to leave if things get                    
  bad.                                                                         
                                                                               
  Number 123                                                                   
                                                                               
  REPRESENTATIVE KOTT asked if MR. BROWN could confirm that                    
  Alaska is the only state requiring coverage up to the $2                     
  million limit.                                                               
                                                                               
  MR. BROWN replied, to the best of his knowledge, Alaska is                   
  the only state.                                                              
                                                                               
  CHAIRMAN VEZEY inquired if there was any valid reason a                      
  person would carry liability insurance that exceeds their                    
  net personal worth.                                                          
                                                                               
  Number 137                                                                   
                                                                               
  MR. BROWN responded net worth is probably the best                           
  "barometer" to use when purchasing liability insurance.  He                  
  noted what is affordable to buy in the market place also                     
  weighs heavily in the decision making process.                               
                                                                               
  Number 157                                                                   
                                                                               
  CHAIRMAN VEZEY said, for example, his net worth was                          
  $250,000.  He asked the minimum policy rate.                                 
                                                                               
  MR. BROWN answered minimum policies are $1,500, $2,500, or                   
  $125,000 single limit as the state requires.                                 
                                                                               
  Number 167                                                                   
                                                                               
  CHAIRMAN VEZEY questioned if there would be a valid reason                   
  for carrying liability insurance which exceed a person's net                 
  personal worth.                                                              
                                                                               
  Number 169                                                                   
                                                                               
  MR. BROWN said yes, it is what an individual may feel they                   
  would be accountable to others in the operation of that                      
  vehicle.  Even if a limit exists, and the accident exceeds                   
  the limit, one would still have the potentiality of personal                 
  liabilities.                                                                 
                                                                               
  CHAIRMAN VEZEY asked HOWARD JAEGER if he would join the                      
  table to testify on HB 403.                                                  
                                                                               
  Number 190                                                                   
                                                                               
  HOWARD JAEGER, SHATTUCK AND GRUMMETT INSURANCE, testified in                 
  favor of HB 403.  He emphasized HB 403 would not preclude                    
  those drivers that want to buy higher uninsured limits from                  
  buying them.  Companies who offer an individual $500,000                     
  worth of liability insurance to purchase would have to                       
  provide that amount.  HB 403 would provide; however, those                   
  companies which can only offer $50,000 and $100,000 bodily                   
  injury limits to only have to offer $50,000 and $100,000                     
  uninsured motorist limits.  Insurance companies can already                  
  offer high liability limits far in excess of state                           
  requirements. Therefore, HB 403 would not limit an                           
  individual's ability to still buy the higher limits after                    
  they are no longer law.  MR. JAEGER explained higher limits                  
  of uninsured motorists have generally not been purchased by                  
  the consumer.  Many people are buying insurance at their                     
  current liability limits, or even lower.  Alaska's mandatory                 
  insurance limits currently are higher than any of the other                  
  49 states in the Nation.  Regarding young drivers, because                   
  their costs have increased and the way the law is written,                   
  they can reject uninsured motorist insurance totally.  He                    
  believed the Division of Insurance had submitted information                 
  to the committee in support of HB 403.                                       
                                                                               
  Number 243                                                                   
                                                                               
  REPRESENTATIVE HUDSON asked if Alaska was the only state                     
  with arbitrarily established top limits on insurance, and                    
  how does Alaska compare on the bottom limits.                                
                                                                               
  Number 249                                                                   
                                                                               
  MR. JAEGER answered Alaska's liability minimums are almost                   
  double the limits in any other state, even triple over some                  
  states.  Uninsured motorist insurance, he recollected, is a                  
  mandatory offering by about half of the other states, but                    
  none of them meet the 1-2 million limits in Alaska.                          
                                                                               
  Number 257                                                                   
                                                                               
  REPRESENTATIVE HUDSON pointed out those who have preceded                    
  [us] have some how determined that Alaska's bottom limits                    
  should be twice as high as the next highest in the Nation.                   
  The state also determines arbitrarily that any company                       
  operating in Alaska has to offer 1-2 million limits even                     
  though other states do not.  He felt HB 403 would put                        
  insurance limits back down into normal ranges.  He                           
  emphasized the bottom limits would be worked on next,                        
  because young individuals are going uninsured due to                         
  Alaska's bottom limits being so high that they cannot afford                 
  it.                                                                          
                                                                               
  Number 281                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS asked if page 1, line 14, referred                   
  to the $125,000 bottom limit when it states,"the policy                      
  limit written may not be less than the policy limit in AS                    
  28.20.440."                                                                  
                                                                               
  Number 289                                                                   
                                                                               
  MR. JAEGER affirmed REPRESENTATIVE G. DAVIS.  Liability                      
  insurance is written with "split limits," whereby each                       
  person has $50,000 maximum, $100,000 for each accident, and                  
  $25,000 property damage liability.  Liability insurance can                  
  also be written with $125,000 total which includes bodily                    
  injury and property damage.                                                  
                                                                               
  MR. JAEGER addressed CHAIRMAN VEZEY's question as to why a                   
  person may want to buy higher liability limits.  He felt an                  
  individual cannot judge the worth of someone they may                        
  involve in a major accident.  Therefore, a judgment could                    
  come against that individual which could far exceed his/her                  
  stated liability limit.  The judgment against them would be                  
  precluded by the amount of liability they have and also by                   
  the amount of assets they have.                                              
                                                                               
  Number 316                                                                   
                                                                               
  CHAIRMAN VEZEY commented the judgment is against the person                  
  and not the insurance company.                                               
                                                                               
  Number 317                                                                   
                                                                               
  MR. JAEGER affirmed CHAIRMAN VEZEY.                                          
                                                                               
  Number 318                                                                   
                                                                               
  CHAIRMAN VEZEY continued a person buys insurance to protect                  
  their assets.   However, in Alaska insurance is bought                       
  because it is required by law.  He asked if a person could                   
  receive a judgment which not only takes their assets, but                    
  also their insurance policy.                                                 
                                                                               
  Number 328                                                                   
                                                                               
  MR. JAEGER responded if the judgment was for $150,000, and                   
  the liability insurance policy only covered $100,000, the                    
  insurance company would pay the $100,000 and leave the other                 
  $50,000 for the policyholder to come up with.                                
                                                                               
  Number 338                                                                   
                                                                               
  REPRESENTATIVE OLBERG explained he carries a $1 million                      
  liability on his homeowner insurance because he wants a                      
  "willing and enthusiastic partner when [he] gets in                          
  trouble."  He said it only costs him $20-25 more than the                    
  minimum every month to have this type of coverage.  He said                  
  he understood that if an individual is worth a $100,000 and                  
  gets a judgment against him/her for $500,000, then that                      
  individual will have to spend the rest of his/her life                       
  paying off the debt.                                                         
                                                                               
  CHAIRMAN VEZEY believed at that point the bankruptcy laws                    
  would take effect.                                                           
                                                                               
  REPRESENTATIVE OLBERG did not believe declaring bankruptcy                   
  would be the solution.                                                       
                                                                               
  Number 350                                                                   
                                                                               
  CHAIRMAN VEZEY asked JOHN GEORGE to testify next.                            
                                                                               
  Number 356                                                                   
                                                                               
  JOHN GEORGE, NATIONAL ASSOCIATION OF INDEPENDENT INSURERS,                   
  testified in favor of HB 403.  He stated he used to be the                   
  Director of Insurance for the State of Alaska, and while in                  
  that position, the law presently being challenged by HB 403                  
  was adopted.  He pointed out the passage of that bill did                    
  lead to the loss of several insurance carriers.  The reason                  
  insurance carriers cannot offer the $2 million limit is                      
  because of their reinsurance.  Insurance companies lay off                   
  part of the risk to other insurers, and their contracts with                 
  these other insurers contemplates the type of business that                  
  they write.  If companies write up to $500,000 worth of                      
  liability, they buy reinsurance that covers them for                         
  $400,000, in excess of the $100,000 they want to retain.                     
  With the $2 million limit, the company would have to buy                     
  $1.9 million in reinsurance to cover themselves, in excess                   
  of the $100,000 they would want to retain on account.  He                    
  emphasized the $2 million limit is not economical for Alaska                 
  when there are multiple states writing policies.  Reinsurers                 
  even look at Alaska's requirement and question whether or                    
  not they should even reinsure the companies because of the                   
  unusually high amount.                                                       
                                                                               
  MR. GEORGE addressed REPRESENTATIVE HUDSON'S statement about                 
  reducing the minimum requirements.  He felt reducing them                    
  would be attractive, realizing there would always be the                     
  chance of getting into a major accident, the vast majority                   
  of accidents involve only $2,000-$5,000 worth of damages and                 
  some medical bills.  These types of accidents could be                       
  covered by fairly minimal insurance limits.  He noted if an                  
  accident is the fault of a person with low liability                         
  insurance, and the other party has a higher limit, the lower                 
  limit would cover what it could and the higher insurance of                  
  the other party would cover the difference.  He emphasized                   
  people would not be disadvantaged by not being able to                       
  collect, and he agreed lowering the bottom limits would                      
  cover individuals for 99 percent of the accidents they would                 
  be in.                                                                       
                                                                               
  Number 416                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS moved to pass HB 403 from committee                  
  with individual recommendations, and accompanying fiscal                     
  note.                                                                        
                                                                               
  Number 419                                                                   
                                                                               
  CHAIRMAN VEZEY noted the fiscal note for HB 403 was on page                  
  3, and asked the committee secretary to call the roll.                       
  CHAIRMAN VEZEY announced HB 403 passed unanimously from the                  
  House State Affairs committee with individual                                
  recommendations.                                                             
                                                                               
  CHAIRMAN VEZEY called for a recess at 9:12 a.m.  The meeting                 
  reconvened at 9:26 a.m. with REPRESENTATIVES B. DAVIS and                    
  OLBERG present.                                                              
                                                                               
  HB 345 - PRESERVATION OF PUBLIC FACILITIES                                   
                                                                               
  CHAIRMAN VEZEY opened HB 345 for discussion under bills                      
  previously heard.                                                            
                                                                               
  Number 443                                                                   
                                                                               
  JEANNETTE JAMES, PRIME SPONSOR OF HB 345, addressed the                      
  bill.  She commented since the last hearing of HB 345, the                   
  State Association of Facilities Management held a meeting to                 
  discuss HB 345 and decided they would propose a committee                    
  substitute.                                                                  
                                                                               
  Number 451                                                                   
                                                                               
  CHAIRMAN VEZEY asked if the committee had received a revised                 
  fiscal note.                                                                 
                                                                               
  Number 452                                                                   
                                                                               
  REPRESENTATIVE JAMES replied another fiscal note was                         
  received from the University of Alaska Fairbanks (UAF).  She                 
  suspected, in looking at the two fiscal notes, that the                      
  reduction of the operating budget meant the university was                   
  not asking for operation dollars.  The difference between                    
  the capital request starting in 1995 from $16 million in the                 
  Department of Transportation fiscal note, to the $11 million                 
  in the UAF fiscal note, is to just include that portion that                 
  would relate to UAF.                                                         
                                                                               
  REPRESENTATIVE JAMES stated the purpose of HB 345 is to put                  
  emphasis on the maintenance of the state's public                            
  facilities.  She said the sooner these facilities are taken                  
  care of, the better off the state will be.  She would like                   
  to set in statute, a formula for funding maintenance of                      
  public facilities based on a life cost basis.  This formula                  
  would be used for allocating revenues that would be required                 
  for each agency.  Each agency, including the Governor, would                 
  have to present their number in the budget process.  She                     
  would like the legislature to be required to fund these                      
  amounts, before they could authorize the construction of new                 
  facilities.  She pointed out the state has continued to fund                 
  new facilities, without any consideration for buildings the                  
  state already has.                                                           
                                                                               
  REPRESENTATIVE JAMES outlined the fiscal note as the $61                     
  million, indicated in the total operating cost, would be the                 
  amount required in the current year's budget if the                          
  legislature were to formula fund the percentage of                           
  maintenance required for all existing facilities.  Of the                    
  $61 million, about $35-36 million is included in the                         
  operating budget that has been presented by the Governor.                    
  She noted the great short fall in the operating budget,                      
  compared to what the budget has requested.  The capital line                 
  is the amount that would take over a period of 15 years to                   
  catch up on the deferred maintenance the state has fallen                    
  behind on.                                                                   
                                                                               
  CHAIRMAN VEZEY asked if the legislature were to authorize                    
  $75 million in bonding, how would it impact the proposed                     
  fiscal note.                                                                 
                                                                               
  Number 498                                                                   
                                                                               
  REPRESENTATIVE JAMES suggested the $75 million would not                     
  address the deficit between the $35 million currently in the                 
  budget and the $61 million that would be required just to                    
  keep up.  Until the state fully funds maintenance, the state                 
  will continue to fall behind.                                                
                                                                               
  Number 509                                                                   
                                                                               
  CHAIRMAN VEZEY questioned what $31 million REPRESENTATIVE                    
  JAMES was referring to in the budget.                                        
                                                                               
  Number 510                                                                   
                                                                               
  REPRESENTATIVE JAMES responded $31 million is spread out                     
  through the agencies' budgets.                                               
                                                                               
  Number 511                                                                   
                                                                               
  CHAIRMAN VEZEY stated when he brought up the $75 million in                  
  bonding, he was only referring to the university.                            
                                                                               
  Number 512                                                                   
                                                                               
  REPRESENTATIVE JAMES was not aware of the University's                       
  operating budget for 1994.  She suspected it did not address                 
  deferred maintenance and it only addresses the past deferred                 
  maintenance by the $75 million.  She noted the University                    
  would continue to pick up more deferred maintenance because                  
  it was not in the budget.                                                    
                                                                               
  Number 516                                                                   
                                                                               
  CHAIRMAN VEZEY clarified the $75 million would cut in half                   
  the accrued deferred maintenance, and it would not impact                    
  the proposed fiscal note at all.                                             
                                                                               
  Number 517                                                                   
                                                                               
  REPRESENTATIVE JAMES affirmed CHAIRMAN VEZEY.  She was                       
  disappointed there was not more public input and response to                 
  HB 345.  She wanted to make the public aware of the                          
  seriousness of the problem.                                                  
                                                                               
  CHAIRMAN VEZEY asked what she had meant by public.                           
                                                                               
  Number 525                                                                   
                                                                               
  REPRESENTATIVE JAMES answered anyone other than the                          
  legislature.                                                                 
                                                                               
  (REPRESENTATIVE KOTT returned to the meeting at 9:34 a.m.)                   
                                                                               
  REPRESENTATIVE JAMES felt if HB 345 was an important issue                   
  people would not have to be invited, and if the desire                       
  existed they would be present.                                               
                                                                               
  Number 536                                                                   
                                                                               
  CHAIRMAN VEZEY did not accept her reasoning because he                       
  believed those involved in maintenance were acutely aware of                 
  the problem.  He thought the administrators of the state's                   
  public facilities probably feel like "it's the sword                         
  Democoles hanging over their head."  He stated the majority                  
  of the average public is probably not aware that all of the                  
  state's public facilities are broken or deteriorating.                       
                                                                               
  CHAIRMAN VEZEY stated he felt the fiscal notes were                          
  presented in an improper manner.  The University fiscal note                 
  estimates $11 million escalating at about 3-4 percent a                      
  year.  He stated those capital improvements to existing                      
  facilities represent depreciation and they will accrue,                      
  whether the legislature funds them or not.                                   
                                                                               
  Number 551                                                                   
                                                                               
  REPRESENTATIVE JAMES stated CHAIRMAN VEZEY was correct.                      
                                                                               
  Number 552                                                                   
                                                                               
  CHAIRMAN VEZEY looked at the DOT fiscal note and noted it                    
  included the cost of operation for the facilities.  He                       
  believed they had good reason because their operating                        
  budgets had been manipulated to go to other than building                    
  maintenance, utilities, etc.                                                 
                                                                               
  Number 557                                                                   
                                                                               
  REPRESENTATIVE JAMES responded if the requirement for                        
  maintenance and repair was funded on an ongoing basis, the                   
  operating cost would be found in the operating budget, not                   
  in the capital budget.  If component replacement and renewal                 
  were considered, they might be a capital expenditure.  She                   
  understood general maintenance of public facilities is an                    
  operating expense.  She noted only the $35 million is                        
  included in the $61 million because most of the rest of the                  
  money in the operating and maintenance is for lights and                     
  other utilities that have nothing to do with keeping the                     
  building "up to speed."                                                      
                                                                               
  Number 569                                                                   
                                                                               
  CHAIRMAN VEZEY stated DOT's fiscal note is $61 million just                  
  for operation, plus a capital improvement portion of $16-17                  
  million.                                                                     
                                                                               
  REPRESENTATIVE JAMES clarified the $16 million is to catch                   
  up the deferred maintenance that has not been done in                        
  previous years.                                                              
                                                                               
  Number 574                                                                   
                                                                               
  CHAIRMAN VEZEY stated the $61 million includes scheduled                     
  maintenance.  He had believed the $61 million included                       
  operation of the building, including utilities.                              
                                                                               
  Number 576                                                                   
                                                                               
  REPRESENTATIVE JAMES stated the $61 million did also include                 
  operation of the buildings and utilities.  She noted                         
  throughout the agency budgets $35 million has been                           
  distributed of the $61 million.  She clarified this depicts                  
  that there is a deficit in the 1994 budget, which is going                   
  to contribute to the capital needs in the future.                            
                                                                               
  Number 584                                                                   
                                                                               
  CHAIRMAN VEZEY felt the committee may have not thoroughly                    
  reviewed their packets on HB 345 yet.                                        
                                                                               
  Number 587                                                                   
                                                                               
  REPRESENTATIVE KOTT agreed.                                                  
                                                                               
  Number 589                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS stated the fiscal note was the                       
  obvious factor which was detracting from the attractiveness                  
  of HB 345. However, he felt a mechanism did need to be found                 
  to deal with the deferred maintenance.  He agreed with                       
  REPRESENTATIVE JAMES that if HB 345 would have had more                      
  public notice, every agency would have been present to                       
  indicate the need for the bill.  He thought HB 345 was                       
  similar to the Executive Order from the 1993 session, which                  
  dealt with transferring all facilities to DOT so they could                  
  run a program similar to that in HB 345.  In reference to                    
  his example, he felt the issue of deferred maintenance was                   
  becoming more up front and open, but solutions are not being                 
  adequately discussed.                                                        
                                                                               
  Number 615                                                                   
                                                                               
  CHAIRMAN VEZEY felt HB 345 would be more attractive if a                     
  zero fiscal note could be structured.  He stated if the                      
  maintenance was not paid for, the existing buildings would                   
  depreciate at a predictable rate and would soon be                           
  uninhabitable.                                                               
                                                                               
  Number 627                                                                   
                                                                               
  REPRESENTATIVE JAMES agreed with CHAIRMAN VEZEY.  She                        
  mentioned maintenance persons would be doing other things                    
  besides just maintenance in several agencies.  Therefore,                    
  the state is really paying for labor which could be amassed                  
  into a definite labor position.  This labor position could                   
  get maintenance done for the same dollars the state is                       
  already spending.  She gave the example of maintenance                       
  people making coffee.                                                        
                                                                               
  REPRESENTATIVE JAMES felt money could be saved in the long                   
  run and the issue of deferred maintenance needs to be                        
  addressed.  She would support putting maintenance in a                       
  special area where it, and the employees, would be properly                  
  utilized so the cost would be less.  She believed a positive                 
  fiscal note could even be offered, if HB 345 could be                        
  revised in some way.                                                         
                                                                               
  Number 646                                                                   
                                                                               
  CHAIRMAN VEZEY believed the legislature would not have a                     
  problem approving a formula for the maintenance of it's                      
  facilities; however, it would have a problem creating                        
  another program.  He did not believe the legislature would                   
  ever deny itself the right to build new facilities until                     
  maintenance was brought up to a certain level, noting one                    
  legislature cannot bind another.  He felt terms would have                   
  to be defined because utilities may or may not be included,                  
  and major maintenance items would need a cost limit.  He                     
  noted some administrators deliberately let maintenance                       
  deteriorate to the extent that it exceeds $25,000, so they                   
  can the have work done under capital improvements, as                        
  opposed to under their maintenance budget.                                   
                                                                               
  Number 667                                                                   
                                                                               
  REPRESENTATIVE JAMES pointed out page 6, line 25, after it                   
  states "a legislature shall", Section 9(7), "appropriate                     
  funds for the full cost of annual maintenance and repair and                 
  periodic renewal and replacement of existing public                          
  facilities of a branch of state government...before funding                  
  construction of new public facilities or substantial                         
  addition to existing public facilities."  She asked if this                  
  should be reworded to not be so strong.                                      
                                                                               
  REPRESENTATIVE JAMES would not want to bind other                            
  legislatures, but she wants them to have to notice its                       
  existence.                                                                   
                                                                               
  CHAIRMAN VEZEY commented the legislature would not pass                      
  bills that attempted to bind other legislatures.                             
                                                                               
  REPRESENTATIVE JAMES felt changing the language to where                     
  they would have to first identify before they go forward in                  
  new construction might be effective and not necessarily                      
  binding.                                                                     
                                                                               
  Number 688                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS commented deferred maintenance will                  
  continue to be a problem and the legislature should continue                 
  to talk about it as is it now.  He also felt agencies should                 
  be involved to let them know there are things they can do to                 
  keep the problem on the forefront.  New facilities will face                 
  the same fate as existing facilities in the future if they                   
  are not taken care of.  He stated even before an agency                      
  offers a new section or service which will cost more money,                  
  they should have to look at where they could spend that                      
  money in deferred maintenance.                                               
                                                                               
  TAPE 94-25, SIDE A                                                           
  Number 015                                                                   
                                                                               
  (REPRESENTATIVE OLBERG left the meeting at 9:46 a.m.)                        
                                                                               
  CHAIRMAN VEZEY stated he was not prepared at the time to                     
  prepare a committee substitute which would address the                       
  short-comings he has found in HB 345.                                        
                                                                               
  Number 026                                                                   
                                                                               
  REPRESENTATIVE JAMES referred to the comments by CHAIRMAN                    
  VEZEY about the fiscal note and the attempt by HB 345 to                     
  bind other legislatures, and asked if he would be more                       
  comfortable with moving HB 345 out of committee if these two                 
  concerns were amended.                                                       
                                                                               
  CHAIRMAN VEZEY did not have a problem moving the HB 345 out                  
  of committee; however, he wanted HB 345 to be more                           
  attractive to the legislature so it would not be buried in                   
  the Finance Committee.  He felt a zero fiscal note could be                  
  made if HB 345 was made into an advisory report.  HB 345 may                 
  fit into HB 347, which will be heard March 10, 1994, because                 
  it deals with state long-term planning.                                      
                                                                               
  Number 055                                                                   
                                                                               
  REPRESENTATIVE JAMES said she would support any plans for                    
  the future because historically, the state has not done it.                  
  She took CHAIRMAN VEZEY's suggestion that HB 345 be made                     
  into an advisory, as opposed to a formula program.  She felt                 
  the public needed to be informed that the formula would                      
  actually work.  She noted when money is authorized for                       
  construction of new buildings, fiscal notes are attached                     
  which shows the cost of maintenance for that building in the                 
  future.  She offered to make the changes to HB 345 and bring                 
  it back before the committee as a sponsor substitute, so the                 
  bill would not get stalled in committee.                                     
                                                                               
  Number 099                                                                   
                                                                               
  CHAIRMAN VEZEY thought a zero fiscal note could even be                      
  attached to the sponsor substitute if worded correctly.  The                 
  bill may have to carry some cost to perhaps prepare a report                 
  on an annual basis.                                                          
                                                                               
  Number 114                                                                   
                                                                               
  REPRESENTATIVE JAMES appreciated hearing HB 345 before the                   
  committee because the issue is important and, even if it                     
  becomes an interim project, she will not let the problem go                  
  away.                                                                        
                                                                               
  Number 119                                                                   
                                                                               
  CHAIRMAN VEZEY believed the legislature does not see                         
  information to the extent of regarding deteriorating public                  
  facilities.  Life cycle costing has now become an important                  
  issue.  HB 345 could be revised and made attractive enough                   
  to gain the support of the legislature.                                      
                                                                               
  Number 136                                                                   
                                                                               
  REPRESENTATIVE JAMES asked, if a sponsor substitute was                      
  drafted, would the committee consider rehearing HB 345 and                   
  moving it out of committee.                                                  
                                                                               
  CHAIRMAN VEZEY replied the committee would consider                          
  rehearing HB 345 if they received a zero fiscal note.  HB
  345 was held in committee for reconsideration.                               
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  Hearing no more business before the committee, CHAIRMAN                      
  VEZEY adjourned the meeting at 9:55 a.m.                                     
  SCHEDULED BUT NOT HEARD                                                      
                                                                               
  HB 405:   "An Act establishing and relating to the Alaska                    
            Information Network Corporation; relating to the                   
            Telecommunications Information Council; and                        
            relating to the state's information industry; and                  
            providing for an effective date."                                  
  SCHEDULED BUT NOT HEARD                                                      
  HB 347:   "An Act relating to long-term plans of certain                     
            state agencies."                                                   

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