Legislature(1997 - 1998)

04/17/1997 08:05 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                         April 17, 1997                                        
                            8:05 a.m.                                          
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Jeannette James, Chair                                         
 Representative Ethan Berkowitz                                                
 Representative Fred Dyson                                                     
 Representative Kim Elton                                                      
 Representative Ivan Ivan                                                      
 Representative Al Vezey                                                       
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 Representative Mark Hodgins                                                   
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 HOUSE BILL NO. 188                                                            
 "An Act relating to calculation of compensation for the public                
 employees' retirement system."                                                
                                                                               
      - HEARD AND HELD                                                         
                                                                               
 HOUSE BILL NO. 79                                                             
 "An Act relating to the offense of possession of tobacco by a                 
 person under 19 years of age."                                                
                                                                               
      - MOVED CSHB 79(STA) OUT OF COMMITTEE                                    
                                                                               
 SENATE CONCURRENT RESOLUTION NO. 7                                            
 Relating to the thirty-first annual Boys' State.                              
                                                                               
      - MOVED SCR 7 OUT OF COMMITTEE                                           
                                                                               
 SENATE CONCURRENT RESOLUTION NO. 8                                            
 Relating to the twenty-ninth annual Girls' State.                             
                                                                               
      - MOVED SCR 8 OUT OF COMMITTEE                                           
                                                                               
 CS FOR SENATE BILL NO. 68(FIN)                                                
 "An Act relating to the Task Force on Privatization; and providing            
 for an effective date."                                                       
                                                                               
      - HEARD AND HELD                                                         
                                                                               
 (* First public hearing)                                                      
                                                                               
 PREVIOUS ACTION                                                               
                                                                               
 BILL:  HB 188                                                               
 SHORT TITLE: DEFINITION OF COMPENSATION IN PERS                               
 SPONSOR(S): REPRESENTATIVE(S) COWDERY                                         
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 03/12/97       640    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/12/97       640    (H)   STATE AFFAIRS, FINANCE                            
 04/08/97              (H)   STA AT  8:00 AM CAPITOL 102                       
 04/08/97              (H)   MINUTE(STA)                                       
 04/10/97              (H)   MINUTE(STA)                                       
 04/17/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  HB  79                                                               
 SHORT TITLE: MINOR IN POSSESSION OF TOBACCO                                   
 SPONSOR(S): REPRESENTATIVE(S) BUNDE, James                                    
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 01/16/97        90    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/16/97        90    (H)   STA, JUDICIARY, FINANCE                           
 04/03/97              (H)   STA AT  8:00 AM CAPITOL 102                       
 04/03/97              (H)   MINUTE(STA)                                       
 04/03/97       978    (H)   COSPONSOR(S): JAMES                               
 04/08/97              (H)   STA AT  8:00 AM CAPITOL 102                       
 04/08/97              (H)   MINUTE(STA)                                       
 04/17/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  SCR  7                                                               
 SHORT TITLE: THIRTY-FIRST ANNUAL BOYS' STATE                                  
 SPONSOR(S): SENATOR(S) LEMAN, Pearce, Phillips; REPRESENTATIVE(S)             
 Grussendorf                                                                   
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 03/11/97       672    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 03/11/97       672    (S)   STATE AFFAIRS                                     
 03/18/97              (S)   STA AT  3:30 PM BELTZ ROOM 211                    
 03/18/97              (S)   MINUTE(STA)                                       
 03/19/97       778    (S)   STA RPT  4DP                                      
 03/19/97       778    (S)   DP: GREEN, DUNCAN, MACKIE, WARD                   
 03/19/97       778    (S)   ZERO FISCAL NOTE (S.STA)                          
 03/21/97              (S)   RLS AT 10:45 AM FAHRENKAMP RM 203                 
 03/21/97              (S)   MINUTE(RLS)                                       
 03/21/97       802    (S)   RULES TO CALENDAR AND DP2      3/21/97            
 03/21/97       807    (S)   READ THE SECOND TIME                              
 03/21/97       807    (S)   PASSED Y15 N- E4 A1                               
 03/21/97       810    (S)   TRANSMITTED TO (H)                                
 03/24/97       800    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/24/97       800    (H)   STATE AFFAIRS                                     
 03/24/97       819    (H)   CROSS SPONSOR(S): GRUSSENDORF                     
 04/17/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  SCR  8                                                               
 SHORT TITLE: TWENTY-NINTH ANNUAL GIRLS' STATE                                 
 SPONSOR(S): SENATOR(S) LEMAN, Pearce, Phillips; REPRESENTATIVE(S)             
 Grussendorf                                                                   
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 03/11/97       672    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 03/11/97       672    (S)   STATE AFFAIRS                                     
 03/18/97              (S)   STA AT  3:30 PM BELTZ ROOM 211                    
 03/18/97              (S)   MINUTE(STA)                                       
 03/19/97       779    (S)   STA RPT   4DP                                     
 03/19/97       779    (S)   DP: GREEN, DUNCAN, MACKIE, WARD                   
 03/19/97       779    (S)   ZERO FISCAL NOTE (S.STA)                          
 03/21/97              (S)   RLS AT 10:45 AM FAHRENKAMP RM 203                 
 03/21/97              (S)   MINUTE(RLS)                                       
 03/21/97       803    (S)   RULES TO CALENDAR AND 2DP    3/21/97              
 03/21/97       808    (S)   READ THE SECOND TIME                              
 03/21/97       808    (S)   PASSED Y15 N- E4 A1                               
 03/21/97       810    (S)   TRANSMITTED TO (H)                                
 03/24/97       800    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/24/97       800    (H)   STATE AFFAIRS                                     
 03/24/97       820    (H)   CROSS SPONSOR(S): GRUSSENDORF                     
 04/17/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  CSSB  68(FIN)                                                        
 SHORT TITLE: TASK FORCE ON PRIVATIZATION                                      
 SPONSOR(S): SENATOR(S) WARD, Wilken                                           
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 01/30/97       172    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 01/30/97       172    (S)   STA, FIN                                          
 01/31/97       194    (S)   STA WAIVED PUBLIC HEARING NOTICE,RULE23           
 02/06/97              (S)   STA AT  3:30 PM BELTZ ROOM 211                    
 02/06/97              (S)   MINUTE(STA)                                       
 02/11/97              (S)   STA AT  3:30 PM BELTZ ROOM 211                    
 02/13/97              (S)   STA AT  3:30 PM BELTZ ROOM 211                    
 02/13/97              (S)   MINUTE(STA)                                       
 02/18/97       392    (S)   STA RPT  CS  3DP 2NR      SAME TITLE              
 02/18/97       392    (S)   DP: GREEN,WARD,MILLER; NR:                        
                             MACKIE,DUNCAN                                     
 03/06/97              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 03/21/97              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 03/21/97              (S)   MINUTE(FIN)                                       
 03/21/97              (S)   MINUTE(FIN)                                       
 03/25/97              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 03/25/97              (S)   MINUTE(FIN)                                       
 03/25/97              (S)   MINUTE(FIN)                                       
 03/26/97       872    (S)   INDETERMINATE FN TO STA CS (GOV/OMB)              
 03/26/97       872    (S)   FIN RPT  CS  2DP 5NR      SAME TITLE              
 03/26/97       872    (S)   DP: SHARP, DONLEY;    NR: PEARCE,                 
 03/26/97       872    (S)   NR: PHILLIPS, ADAMS, TORGERSON, PARNELL           
 03/26/97       872    (S)   FN TO CS (LAA)                                    
 03/26/97       872    (S)   INDETERMINATE FN TO FIN CS (GOV/ADM)              
 03/26/97       872    (S)   PREVIOUS IND FN APPLIES TO CS (GOV/OMB)           
 03/27/97              (S)   RLS AT 10:45 AM FAHRENKAMP RM 203                 
 04/02/97       934    (S)   RULES TO CALENDAR AND 1NR   4/2/97                
 04/02/97       935    (S)   READ THE SECOND TIME                              
 04/02/97       935    (S)   FIN  CS ADOPTED UNAN CONSENT                      
 04/02/97       936    (S)   AM NO  1     OFFERED BY DUNCAN                    
 04/02/97       936    (S)   AM NO  1     FAILED  Y6 N13 A1                    
 04/02/97       936    (S)   ADVANCED TO THIRD READING UNAN CONSENT            
 04/02/97       936    (S)   READ THE THIRD TIME  CSSB 68(FIN)                 
 04/02/97       937    (S)   PASSED Y14 N5 A1                                  
 04/02/97       937    (S)   EFFECTIVE DATE(S) SAME AS PASSAGE                 
 04/02/97       937    (S)   DUNCAN  NOTICE OF RECONSIDERATION                 
 04/03/97       964    (S)   RECON TAKEN UP - IN THIRD READING                 
 04/03/97       965    (S)   PASSED ON RECONSIDERATION Y15 N5                  
 04/03/97       965    (S)   EFFECTIVE DATE(S) SAME AS PASSAGE                 
 04/03/97       966    (S)   TRANSMITTED TO (H)                                
 04/04/97       983    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 04/04/97       984    (H)   STATE AFFAIRS, FINANCE                            
 04/17/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 TIM ROGERS, Legislative Program Coordinator                                   
 Municipality of Anchorage                                                     
 P.O. Box 196650                                                               
 Anchorage, Alaska 99519                                                       
 Telephone:  (907) 343-4467                                                    
 POSITION STATEMENT:  Provided testimony in support of HB 188.                 
                                                                               
 FRANK SMITH                                                                   
 P.O. Box 1199                                                                 
 Barrow, Alaska 99723                                                          
 Telephone:  (907) 852-4983                                                    
 POSITION STATEMENT:  Provided testimony in opposition to HB 188.              
                      Provided testimony on SB 68.                             
                                                                               
 PATRICIA SWENSON, Legislative Assistant                                       
    to Representative Con Bunde                                                
 State Capitol, Room 104                                                       
 Juneau, Alaska 99801-1182                                                     
 Telephone:  (907) 465-4843                                                    
 POSITION STATEMENT:  Provided committee substitute.                           
                                                                               
 LOREN JONES, Director                                                         
 Division of Alcoholism and Drug Abuse                                         
 Department of Health and Social Services                                      
 P.O. Box 110607                                                               
 Juneau, Alaska 99811-0607                                                     
 Telephone:  (907) 465-2071                                                    
 POSITION STATEMENT:  Provided testimony on CSHB 79(STA).                      
                                                                               
 JENNIFER STRICKLER, Administrative Officer                                    
 Division of Occupational Licensing                                            
 Department of Commerce and Economic Development                               
 P.O. Box 110806                                                               
 Juneau, Alaska 99811-0806                                                     
 Telephone:  (907) 465-2144                                                    
 POSITION STATEMENT:  Provided testimony on CSHB 79(STA).                      
                                                                               
 LOIS IRVIN                                                                    
 167 West Bayview Avenue                                                       
 Homer, Alaska 99603                                                           
 Telephone:  (907) 235-7172                                                    
 POSITION STATEMENT:  Provided testimony on HB 79.                             
                                                                               
 LORALI MEIER, Intern                                                          
    to Senator Loren Leman                                                     
 State Capitol, Room 113                                                       
 Juneau, Alaska 99891-1182                                                     
 Telephone:  (907) 465-2095                                                    
 POSITION STATEMENT:  Provided sponsor statement for SCR 7 and 8.              
                                                                               
 SENATOR JERRY WARD                                                            
 Alaska State Legislature                                                      
 State Capitol, Room 423                                                       
 Juneau, Alaska 99801-1182                                                     
 Telephone:  (907) 465-4940                                                    
 POSITION STATEMENT:  Sponsor of SB 68.                                        
                                                                               
 JAMES BALDWIN, Assistant Attorney General                                     
 Governmental Affairs Section                                                  
 Civil Division                                                                
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska 99811-0300                                                     
 Telephone:  (907) 465-3600                                                    
 POSITION STATEMENT:  Provided testimony in opposition to SB 68.               
                                                                               
 MIKE McMULLEN, Personnel Manager                                              
 Division of Personnel                                                         
 Department of Administration                                                  
 P.O. Box 110201                                                               
 Juneau, Alaska 99811-0201                                                     
 Telephone:  (907) 465-4431                                                    
 POSITION STATEMENT:  Provided testimony on SB 68.                             
                                                                               
 PAMELA LaBOLLE, President                                                     
 Alaska State Chamber of Commerce                                              
 217 Second Street, Suite 201                                                  
 Juneau, Alaska 99801                                                          
 Telephone:  (907) 586-2323                                                    
 POSITION STATEMENT:  Provided testimony in support of SB 68.                  
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 97-45, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 The House State Affairs Standing Committee was called to order by             
 Chair Jeannette James at 8:05 a.m.  Members present at the call to            
 order were Representatives James, Berkowitz, Dyson, Elton, Ivan and           
 Vezey.  Members absent were Hodgins.                                          
                                                                               
 HB 188 - DEFINITION OF COMPENSATION IN PERS                                 
                                                                               
 The first order of business to come before the House State Affairs            
 Standing Committee was HB 188, "An Act relating to calculation of             
 compensation for the public employees' retirement system."                    
                                                                               
 Number 0081                                                                   
                                                                               
 CHAIR JEANNETTE JAMES explained that the public testimony was                 
 closed at the last meeting.  She would open it up again so that the           
 Municipality of Anchorage could testify.  There would not be any              
 action taken on the bill today, however, other than testimony.                
                                                                               
 Number 0119                                                                   
                                                                               
 TIM ROGERS, Legislative Program Coordinator, Municipality of                  
 Anchorage, was the first person to testify via teleconference in              
 Anchorage.  He thanked Representative Cowdery for introducing the             
 bill on behalf of the municipality.  It could save the municipality           
 and the state a tremendous amount of money in the long run.  It was           
 also a safety issue and concern for an officer who worked 1,500               
 hours of overtime.  The municipality had a certain amount of                  
 control to reduce the amount of overtime.  He cited recently the              
 police officers were put on a five-day week, eight hour shift; and            
 were taken off of a four-day week, ten hour shift, saving money in            
 overtime.  More police officers were put on the streets as well.              
 However, a lot of the overtime was out of our control.  For                   
 example, several hundreds of thousands of dollars were spent on               
 overtime fighting the Millers Reach fire.  It was clearly not a               
 municipal issue; and was out of our control, but it had to be done.           
 In conclusion, the municipality supported the passage of HB 188.              
                                                                               
 Number 0329                                                                   
                                                                               
 FRANK SMITH was the next person to testify via teleconference in              
 Barrow.  He was concerned because the legislature had short funded            
 many state departments which were not able to fill positions.  This           
 left current workers subject to serious overtime to make up for the           
 short fall.  Therefore, removing overtime from the retirement                 
 system removed one more incentive to not fill the empty positions.            
 He was opposed to the bill                                                    
                                                                               
 Number 0442                                                                   
 CHAIR JAMES announced the public testimony was closed again for HB
 188.  The bill would be taken up again at a later date yet to be              
 determined.                                                                   
                                                                               
 HB 79 - MINOR IN POSSESSION OF TOBACCO                                      
                                                                               
 The next order of business to come before the House State Affairs             
 Standing Committee was HB 79, "An Act relating to the offense of              
 possession of tobacco by a person under 19 years of age."                     
                                                                               
 Number 0477                                                                   
                                                                               
 PATRICIA SWENSON, Legislative Assistant to Representative Con                 
 Bunde, explained the committee substitute (0-LS0348/P, Chenoweth,             
 4/16/97).                                                                     
                                                                               
 MS. SWENSON explained Section 1 added language to prevent the                 
 business license endorsement owner, employee, or agent from being             
 charged with a violation of selling or giving tobacco to a minor if           
 the person showed proper identification.  The new language was                
 included under AS 11.76 to allow for enforcement by local                     
 authorities.  Similar language was also included on page 7-8 in AS            
 43.70.075.  The requirement of a person to sign a statement of age            
 was dropped in the section.  The intent was basically:  no                    
 identification, no sale.  It would not let the retailer off the               
 hook in any way.  The language concerning an employee in a break              
 room was deleted in this section also.                                        
                                                                               
 MS. SWENSON explained Sec. 2 addressed the issue of single                    
 cigarettes.  It was renamed to "Unlawful sale of products                     
 containing tobacco."  It made the unlawful sale an offense                    
 punishable upon conviction of a fine of $300.  In addition, the               
 Department of Commerce and Economic Development (DCED) could act              
 with an administrative hearing to suspend or revoke an endorsement.           
 The offenses chargeable were the following:  to sell cigarettes               
 that were not in their original package, to sell cigarettes in a              
 package of less than 20, to sell cigarettes that did not display a            
 warning, to sell cigarettes without assuring that they were kept in           
 a secure place, to sell cigarettes in a store that failed to post             
 the warning sign, or to sell cigarettes to a person under 19 years            
 of age.  The section also made it an offense to present false                 
 identification.                                                               
                                                                               
 MS. SWENSON explained Sec. 3 renamed Sec. 11.76.105 to "Possession            
 of tobacco by a person under 19 years of age."  It also removed the           
 ability of a minor to posses tobacco while in an adult correctional           
 facility.  It clarified the amount of the fine for a minor in                 
 possession of tobacco at $300.                                                
                                                                               
 MS. SWENSON explained Sec. 4 made the failure to supervise a                  
 cigarette vending machine an offense with criminal negligence.                
 MS. SWENSON explained Sec. 5 remained the same.                               
                                                                               
 MS. SWENSON explained Sec. 6 added the language "or from developing           
 tobacco-related education programs." as part of the anti-exemption            
 provision so that the local government would not be preempted from            
 adding other access programs.                                                 
                                                                               
 MS. SWENSON explained Sec. 8 combined Sec. 7,8,9,10 and 11 of the             
 last committee substitute.  The changes were under AS 43.70                   
 requiring each owner to have a separate business license                      
 endorsement for each establishment that sold cigarettes.  It also             
 allowed the DCED to refuse a license to an establishment that had             
 a suspended or revoked endorsement.  The intent was to prevent an             
 owner from changing the name of his establishment upon revocation             
 then turning around and getting a new endorsement under the new               
 name.  It also allowed for the revocation of a business license               
 endorsement without an administrative hearing when the owner had              
 been convicted of a regulation violation.  It also allowed for the            
 signing of a statement of age instead of showing identification.              
                                                                               
 MS. SWENSON explained Sec. 9 gave the department the ability to               
 suspend or revoke a license without an administrative hearing upon            
 conviction.                                                                   
                                                                               
 MS. SWENSON explained Sec. 11 allowed the legislature to                      
 appropriate money from the increased business license endorsement             
 fee for enforcement.                                                          
                                                                               
 MS. SWENSON explained Sec. 12 granted the department the authority            
 to adopt regulations to determine and collect the fees imposed.               
                                                                               
 Number 0943                                                                   
                                                                               
 REPRESENTATIVE IVAN IVAN commented that he represented a lot of               
 small communities.  He asked Ms. Swenson how the training provision           
 in the bill would be executed?                                                
                                                                               
 Number 0978                                                                   
                                                                               
 MS. SWENSON replied the department indicated it would set up a                
 correspondence type training.                                                 
                                                                               
 Number 1001                                                                   
                                                                               
 REPRESENTATIVE KIM ELTON asked Ms. Swenson if a new fiscal note had           
 been requested from the Department of Commerce and Economic                   
 Development?                                                                  
                                                                               
 MS. SWENSON replied, "Yes."  There was a department member here who           
 could speak to the new fiscal note.  It would end up being a wash.            
                                                                               
 Number 1040                                                                   
 CHAIR JAMES asked Ms. Swenson if there was a penalty in the bill              
 for kids caught selling cigarettes to other kids?                             
                                                                               
 MS. SWENSON replied the major thrust of the bill was aimed at the             
 retailer for accountability rather than the minor.  She did not               
 know if anything like that could be added at this time.                       
                                                                               
 Number 1088                                                                   
                                                                               
 REPRESENTATIVE FRED DYSON commented Alaska law already spoke to the           
 issue.  He shared a story about a cop busting a kid for selling               
 single cigarettes for $1.                                                     
                                                                               
 Number 1115                                                                   
                                                                               
 REPRESENTATIVE ETHAN BERKOWITZ commented that Sec. 2 covered the              
 issue as well.  He read, "(a) A person commits the offense of                 
 unlawful sale of products containing tobacco if the person (1)                
 sells cigarettes (A) that are not in their original, unopened                 
 package or container obtained from the distributor;"                          
                                                                               
 MS. SWENSON commented it was a crime to begin with for a minor to             
 possess cigarettes.                                                           
                                                                               
 Number 1136                                                                   
                                                                               
 REPRESENTATIVE ELTON asked Ms. Swenson if there was a prohibition             
 on municipalities from establishing a tobacco tax now?                        
                                                                               
 MS. SWENSON replied, "No."  But often tobacco companies enter at              
 the local level and try to preempt their ability.                             
                                                                               
 Number 1174                                                                   
                                                                               
 LOREN JONES, Director, Division of Alcoholism and Drug Abuse,                 
 Department of Health and Social Services, was the first person to             
 testify in Juneau.  The committee substitute addressed a lot of the           
 concerns of the department.  The bill was a very important part of            
 the enforcement package as a whole.                                           
                                                                               
 Number 1232                                                                   
                                                                               
 REPRESENTATIVE IVAN asked Mr. Jones how the department planned to             
 execute the training portion?                                                 
                                                                               
 Number 1245                                                                   
                                                                               
 MR. JONES replied, according to the DCED, it would establish a                
 mechanism so that the course could be taken without leaving the               
 area to address the concerns of the rural areas.  It would be                 
 addressed further in the regulations.                                         
                                                                               
 Number 1275                                                                   
                                                                               
 JENNIFER STRICKLER, Administrative Officer, Division of                       
 Occupational Licensing, Department of Commerce and Economic                   
 Development, was the next person to testify in Juneau.  The                   
 committee substitute she announced satisfied the concerns of the              
 department.  The changes would create a fiscal impact.  A draft               
 fiscal note was pending the adoption of the committee substitute.             
                                                                               
 CHAIR JAMES asked Ms. Strickler if the fiscal note would be neutral           
 as the sponsor indicated?                                                     
                                                                               
 MS. STRICKLER replied, "Yes."  The fiscal note indicated a little             
 extra because the increased fees covered the cost of the training             
 course.  The extra could be used towards enforcement.                         
                                                                               
 Number 1367                                                                   
                                                                               
 LOIS IRVIN was the first person to testify via teleconference in              
 Homer.  She did not have the committee substitute before her so she           
 did not have any idea what the discussion was about.  It was                  
 interesting, however.                                                         
                                                                               
 CHAIR JAMES announced she would fax the committee substitute to               
 her.                                                                          
                                                                               
 MS. IRVIN said she would like to review it.                                   
                                                                               
 CHAIR JAMES asked that Ms. Irvin review the committee substitute              
 and direct any questions to the sponsor.                                      
                                                                               
 Number 1476                                                                   
                                                                               
 REPRESENTATIVE DYSON asked Mr. Jones how the world would change for           
 a responsible distributor as a result of the bill?  In other words,           
 a distributor that did not have a vending machine and the products            
 were kept in a secured place.                                                 
                                                                               
 Number 1506                                                                   
                                                                               
 MR. JONES replied there were four significant changes.  They were             
 as followed:  An employer would have to make his employees aware of           
 the law; employees would have to go through a refresher course of             
 the laws every couple of years; identification would be asked for             
 more often; and the cost would go up for business.  There were a              
 lot of responsible people who already asked for identification.               
                                                                               
 REPRESENTATIVE DYSON asked how much would the cost of business go             
 up?                                                                           
                                                                               
 MR. JONES replied from $25 to $100 for a single site.  A multiple             
 employer of 5 sites the cost would go from $25 to $500, for                   
 example.                                                                      
                                                                               
 Number 1567                                                                   
                                                                               
 REPRESENTATIVE DYSON asked Mr. Jones how the bill would affect the            
 business environment of tobacco type establishments?                          
                                                                               
 Number 1576                                                                   
                                                                               
 MR. JONES replied he did not frequent tobacco type shops so he did            
 not know.  The areas of change that he mentioned earlier would                
 probably apply as well as the display of the tobacco products so              
 that only a sales person could have access to them.                           
                                                                               
 Number 1618                                                                   
                                                                               
 REPRESENTATIVE DYSON asked Mr. Jones, if the shop would have to               
 keep the items behind the counter, if it precluded those under the            
 age of 19 from entering?                                                      
                                                                               
 Number 1629                                                                   
                                                                               
 MR. JONES replied he was not sure.                                            
                                                                               
 Number 1635                                                                   
                                                                               
 CHAIR JAMES explained the issue of excluding tobacco shops could be           
 addressed in the next committee of referral - the House Judiciary             
 Standing Committee.                                                           
                                                                               
 Number 1665                                                                   
                                                                               
 REPRESENTATIVE IVAN asked Mr. Jones if there was an age restriction           
 for employees who worked in a small mom and pop store that sold               
 cigarettes?  This was common in the smaller communities.                      
                                                                               
 Number 1697                                                                   
                                                                               
 MR. JONES replied he did not know.  However, if he was the owner of           
 a business he would error on the conservative side and not allow              
 someone under 19 to sell any type of tobacco product.  Maybe it was           
 a question to take up in the House Standing Judiciary Committee as            
 well.                                                                         
                                                                               
 Number 1745                                                                   
                                                                               
 REPRESENTATIVE ELTON moved that the committee substitute (0-                  
 LS0348/P, Chenoweth, 4/16/97) be adopted.  There was no objection,            
 the committee substitute was so adopted.                                      
                                                                               
 Number 1760                                                                   
                                                                               
 REPRESENTATIVE DYSON moved that CSHB 79(STA) move from the                    
 committee with individual recommendations and the attached fiscal             
 note(s).                                                                      
                                                                               
 Number 1770                                                                   
                                                                               
 REPRESENTATIVE AL VEZEY objected.  A roll call vote was taken.                
 Representatives James, Berkowitz, Dyson, Elton and Ivan voted in              
 favor of the motion.  Representative Vezey voted against the                  
 motion.  The CSHB 79(STA) was so moved from the House State Affairs           
 Standing Committee.                                                           
                                                                               
 SCR 7 - THIRTY-FIRST ANNUAL BOYS' STATE                                     
                                                                               
 The next order of business to come before the House State Affairs             
 Standing Committee was SCR 7, Relating to the thirty-first annual             
 Boys' State.                                                                  
                                                                               
 LORALI MEIER, Intern, Senator Loren Leman, read the following                 
 statement into the record:                                                    
                                                                               
 "Boys State is a week-long program that provides high school boys             
 with knowledge of state and local government.  SCR 7 recognizes the           
 importance of state and local, public and private involvement in              
 the program in order to make it successful.  Because SCR 7                    
 encourages young men to be leaders, Senator Leman believes this               
 exceptional program deserves the recognition and support of the               
 legislature."                                                                 
                                                                               
 Number 1866                                                                   
                                                                               
 REPRESENTATIVE IVAN moved and asked unanimous consent that SCR 7              
 move from the committee with individual recommendations and the               
 attached fiscal note(s).  There was no objection, SCR 7 was so                
 moved from the House State Affairs Standing Committee.                        
                                                                               
 SCR 8 - TWENTY-NINTH ANNUAL GIRLS' STATE                                    
                                                                               
 The next order of business to come before the House State Affairs             
 Standing Committee was SCR 8, Relating to the twenty-ninth annual             
 Girls' State.                                                                 
                                                                               
 Number 1894                                                                   
                                                                               
 MS. MEIER read the following statement into the record:                       
                                                                               
 "Boys State is a week-long program that provides high school boys             
 with knowledge of state and local government.  SCR 7 recognizes the           
 importance of state and local, public and private involvement in              
 the program in order to make it successful.  Because SCR 7                    
 encourages young men to be leaders, Senator Leman believes this               
 exceptional program deserves the recognition and support of the               
 legislature."                                                                 
                                                                               
 Number 1904                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ moved that SCR 8 move from the committee             
 with individual recommendations and the attached fiscal note(s).              
                                                                               
 Number 1912                                                                   
                                                                               
 REPRESENTATIVE VEZEY objected.  It was not appropriate that a                 
 senator got two bills through the House State Affairs Standing                
 Committee in one day.                                                         
                                                                               
 REPRESENTATIVE VEZEY withdrew his objection.                                  
                                                                               
 CHAIR JAMES asked the committee members if there was any further              
 objection?  There being no further objection, SCR 8 was so moved              
 from the House State Affairs Standing Committee.                              
                                                                               
 CSSB 68(FIN) - TASK FORCE ON PRIVATIZATION                                  
                                                                               
 The next order of business to come before the House State Affairs             
 Standing Committee was CSSB 68(FIN), "An Act relating to the Task             
 Force on Privatization; and providing for an effective date."                 
                                                                               
 Number 1971                                                                   
                                                                               
 SENATOR JERRY WARD, Alaska State Legislature, explained why he                
 introduced the bill.  He talked about privatizing government during           
 his campaign which he discovered was more difficult once in office.           
 It could not be done over night.  "It needs to be looked at and it            
 needs to be looked at carefully."  As a result, he drafted a bill             
 to create a task force.  He was not in favor of task forces or                
 studying something to death.  Therefore, the money was divided in             
 half to look at each section of state government to determine if it           
 was in the public's interest to privatize.  The functions of the              
 following departments would be looked at in the first year:                   
 Transportation and Public Facilities; Corrections; and Health and             
 Social Services.  The three departments represented $1.3 billion.             
 In other states, when a savings was discovered through                        
 privatization, it was around 20 percent.  He did not know where the           
 savings would be, but every dollar would be looked at if the bill             
 was passed.  There were sections that would not be privatized such            
 as the State Troopers, but every section would be looked at.                  
                                                                               
 Number 2153                                                                   
                                                                               
 CHAIR JAMES asked Senator Ward who would be on the task force and             
 how would they be appointed?                                                  
 Number 2159                                                                   
                                                                               
 SENATOR WARD replied they would be appointed by the Speaker,                  
 President and Governor.  The task force would include senators,               
 representatives and members of the public; as-well-as,                        
 representatives of the Alaska State Public Employees Union.  It was           
 a 13-member committee - 5 appointed by the House; 5 appointed by              
 the Senate; and 3 appointed by the Governor.                                  
                                                                               
 Number 2184                                                                   
                                                                               
 CHAIR JAMES commented that the term "privatization" was a buzz                
 word, therefore, there were different meanings.  There was a                  
 difference between the concepts of "contracting out" and                      
 "privatization".  Privatization was when a sector of government               
 went out of business and the private sector picked up the                     
 functions.  Contracting out was when certain parts of government              
 were done by others while the government still maintained control             
 or oversight.  In addition, in the case of contracting out, state             
 employees should have the same opportunity to compete for the                 
 contract.                                                                     
                                                                               
 Number 2277                                                                   
                                                                               
 SENATOR WARD stated he also believed that state employees should be           
 able to compete for any of these things.  In the case of the                  
 privatization of corrections, the prisoners in Arizona were still             
 under the jurisdiction of the Commissioner of Corrections in                  
 Alaska.  That was an example of what should be looked at and                  
 debated.                                                                      
                                                                               
 Number 2349                                                                   
                                                                               
 CHAIR JAMES stated that the dollar should not necessarily be the              
 main concern.  We should also be concerned about and factor                   
 efficiency and effectiveness into the equation.                               
                                                                               
 Number 2377                                                                   
                                                                               
 SENATOR WARD replied he did not disagree.  He assumed that if                 
 something was done more efficient and effective it would be done              
 cheaper.                                                                      
                                                                               
 Number 2397                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ stated what Senator Ward was really going            
 after was what Vice President Al Gore called "reinventing                     
 government".                                                                  
                                                                               
 SENATOR WARD replied it certainly was not what anything Al Gore               
 said.                                                                         
                                                                               
 Number 2417                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ further stated there were private                    
 consulting groups that did this sort of thing for a living and were           
 good at it.  He asked Senator Ward if he had considered this type             
 of service?                                                                   
                                                                               
 Number 2435                                                                   
                                                                               
 SENATOR WARD replied privatization was a policy issue and we were             
 the policy makers - the legislative branch.  "We will make the                
 policy for the Administration," he stated.                                    
                                                                               
 REPRESENTATIVE BERKOWITZ explained he was not asking about policy.            
 He was asking about actual tactics.  The tactics and experience               
 already existed with private consultants.                                     
                                                                               
 TAPE 97-45, SIDE B                                                            
 Number 0004                                                                   
                                                                               
 SENATOR WARD stated the task forces in other states found it was a            
 large expense when the decision came down to the legislative body             
 anyway.                                                                       
                                                                               
 Number 0017                                                                   
                                                                               
 REPRESENTATIVE VEZEY commented the archives were full of studies              
 done on the operations of the various agencies.  The management               
 science of out sourcing versus vertical integration was well                  
 published.  The debate was not if we should do this, but why                  
 haven't we been doing this.  He wondered, therefore, if the fiscal            
 note should be zero.  We should be routinely doing this type of               
 examination anyway.                                                           
                                                                               
 Number 0053                                                                   
                                                                               
 SENATOR WARD replied the fiscal note paid for per diem and travel             
 expenses of the public members.  It did not include a staff                   
 position.  We were not trying to create a new entity.  He agreed              
 that this type of discussion should be on going.                              
                                                                               
 Number 0086                                                                   
                                                                               
 CHAIR JAMES explained this was her fifth year talking about                   
 regulation reform.  The political reality of any kind of reform               
 needed to be factored in - the public, the Administration and other           
 legislators.  She always said that a task force was an excuse to              
 not do anything.                                                              
                                                                               
 Number 0140                                                                   
                                                                               
 SENATOR WARD explained the task force would report back the next              
 legislative session.  We were hearing about privatization now which           
 needed to be seriously looked at.  He was opposed to just another             
 study as well.                                                                
                                                                               
 Number 0202                                                                   
                                                                               
 REPRESENTATIVE ELTON stated he was struck by the irony of not                 
 privatizing a study on privatization.                                         
                                                                               
 Number 0226                                                                   
                                                                               
 SENATOR WARD replied we did not need another study.  We, the policy           
 makers, need to look at the studies and make some decisions.  He              
 did not intend to recreate the wheel.  He would consider other                
 models taken in other states.                                                 
                                                                               
 Number 0280                                                                   
                                                                               
 REPRESENTATIVE ELTON replied we would get another study one way or            
 another either through a government task force or a private                   
 company.  He had a problem with looking at other states because               
 Alaska was not like other states.                                             
                                                                               
 Number 0319                                                                   
                                                                               
 SENATOR WARD replied the task force would be appointed by the                 
 majority of the policy makers.  He did not want experts from afar             
 either.                                                                       
                                                                               
 Number 0349                                                                   
                                                                               
 CHAIR JAMES stated she was concerned about the end-product.  She              
 asked Senator Ward how he envisioned the recommendation?                      
                                                                               
 SENATOR WARD replied he suspected that probably 95 percent would be           
 set aside by the task force while 5 percent would be set into the             
 category of possible privatization.  And, of the 5 percent,                   
 probably 2 percent would be identified as feasible.  The task                 
 force, however, would create its own policy mission.                          
                                                                               
 Number 0413                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ explained the Tort Reform Task Force was             
 not highly esteemed by the House of Representatives.  In addition,            
 we could discuss privatization every day; that was our job.  He did           
 not understand why a task force was needed when a special committee           
 for example could be formed.                                                  
                                                                               
 Number 0453                                                                   
                                                                               
 SENATOR WARD replied neither he nor the legislature were involved             
 in appointing the Tort Reform Task Force.  If the legislature had             
 been involved in appointing members to the Tort Reform Task Force,            
 a bill would have been passed last year.  He wanted to form a task            
 force to start the privatization debate mechanically; it was his              
 way of approaching an issue like this.                                        
                                                                               
 Number 0490                                                                   
                                                                               
 REPRESENTATIVE IVAN stated he supported the concept and the bill.             
 He had not had good experiences with "outside experts" because                
 their concepts usually did not fit the area.                                  
                                                                               
 Number 0574                                                                   
                                                                               
 CHAIR JAMES asked Senator Ward if he would be amenable to changing            
 the findings and intent of Section 1 to include the following                 
 possible language:  "to evaluate those that ought not to be done by           
 government but by the private sector"?                                        
                                                                               
 CHAIR JAMES cited a lecturer who used to work for the Department of           
 Transportation in Oregon.  He called his presentation rightsizing             
 government.  He concluded it was not a privatization issue, but a             
 simplification of the processes.                                              
                                                                               
 Number 0675                                                                   
                                                                               
 SENATOR WARD replied he would not be opposed to amending the                  
 section.                                                                      
                                                                               
 CHAIR JAMES said she would work on the language further and get               
 back to him.                                                                  
                                                                               
 SENATOR WARD stated the gentleman from Oregon eliminated nine                 
 layers of the department and made it run better.  This was one of             
 the reasons why the Department of Transportation and Public                   
 Facilities should be looked at first.                                         
                                                                               
 Number 0700                                                                   
                                                                               
 CHAIR JAMES stated the gentleman from Oregon indicated that you               
 should not privatize something that could become or was a monopoly,           
 or you would lose control.  The railroad in Alaska was an example.            
                                                                               
 Number 0781                                                                   
                                                                               
 JAMES BALDWIN, Assistant Attorney General, Governmental Affairs               
 Section, Civil Division, Department of Law, was the first person to           
 testify in Juneau.  There was clear violation of the separation of            
 powers between the branches by having the Governor appoint members            
 to the task force.  There were good arguments to have everybody get           
 together to discuss a problem of common interest.  But when the               
 branches cross pollinate, there was the possibility that the                  
 legislative branch could prevail thereby weakening the other                  
 branch.  This was a foundation issue that needed to be brought to             
 the attention of the committee.                                               
                                                                               
 Number 0904                                                                   
                                                                               
 CHAIR JAMES wondered if the Long Range Financial Planning                     
 Commission was also a violation.  She asked Mr. Baldwin if the                
 cooperation in preparing and drafting legislation to help the                 
 Administration was all right?                                                 
                                                                               
 Number 0992                                                                   
                                                                               
 MR. BALDWIN replied it was very all right.  It was the duty of the            
 Administration to freely answer questions and to provide                      
 information to legislative committees.  Similarly, the                        
 Administration would be willing to serve and provide information              
 that the task force would need.  He did not see that being a member           
 of the task force would guarantee the receipt of the information              
 any more than it would be compelled to now.  He reiterated                    
 appointing members to serve on a task force that was part of                  
 another branch was a violation.                                               
                                                                               
 Number 1049                                                                   
                                                                               
 CHAIR JAMES said she had never thought of it that way.  She was               
 disappointed with the Long Range Financial Planning Commission -              
 the process, not the results.                                                 
                                                                               
 Number 1093                                                                   
                                                                               
 REPRESENTATIVE ELTON asked Mr. Baldwin if the blurring of the                 
 separation of powers was because the task force was being created             
 by law?  Didn't legislators serve on the Tort Reform Task Force?              
                                                                               
 MR. BALDWIN replied legislators did serve on the Tort Reform Task             
 Force.  There was a blurring of the separation of powers there as             
 well.  There were no legislators appointed at first but due to the            
 outcry from the legislative branch some were appointed.  It was a             
 good example in support of what he was saying today.  The Governor            
 waived his right to object, but he did not waive it for all time.             
 In this instance, the Governor was objecting; he did not want to              
 hold appointing authority for this task force.                                
                                                                               
 Number 1168                                                                   
                                                                               
 CHAIR JAMES replied it was a constitutional mandate and it affected           
 the separation of powers, the Governor could not waive his right.             
                                                                               
 MR. BALDWIN replied he could not waive it for all time.  But he               
 certainly could allow it to happen.  The examples had already been            
 cited.  In addition, a waiver would not bind the next Governor and            
 it did not bind the current Governor.                                         
 Number 1224                                                                   
                                                                               
 CHAIR JAMES wondered if the legislature would have the option to              
 waive its rights.  The Governor, she believed, had the authority to           
 establish any kind of task force on any issue with or without                 
 legislative approval.  He would have the right to include                     
 legislators if he wanted, especially if they could not influence              
 the end result.  The Tort Reform Task Force was not the same as the           
 task force in SB 68 or the Long Range Financial Planning Commission           
 because this was a legislative decision that actually joined the              
 two branches.  She agreed the legislature did not have the right to           
 do that.  It was not an issue of whether or not the Governor wanted           
 to have appointment power, it was whether or not he should have the           
 power.                                                                        
                                                                               
 Number 1364                                                                   
                                                                               
 REPRESENTATIVE ELTON commented the task force would not set policy            
 or make law, it would just make a recommendation.  He wondered,               
 therefore, if the purpose of the task force mitigated the concern             
 of cross pollinazation?                                                       
                                                                               
 Number 1392                                                                   
                                                                               
 MR. BALDWIN replied it could.  It was important to consider who was           
 being advised, however.  This was a very important task force; it             
 would advise the legislature that could change the laws.                      
                                                                               
 Number 1442                                                                   
                                                                               
 CHAIR JAMES said she understood why the Governor did not want to              
 participate.  However, it would be hard to accomplish the goal of             
 the task force without Administrative help, information, and                  
 knowledge.  The Administration knew more about the inner workings             
 of the agencies.  She asked Mr. Baldwin if he knew how the Governor           
 would respond to requests from the task force for information?                
                                                                               
 Number 1553                                                                   
                                                                               
 MR. BALDWIN replied the Administration was not willing to sit on              
 the task force, but it would be willing to assist in any way                  
 possible by providing information and data.                                   
                                                                               
 Number 1593                                                                   
                                                                               
 REPRESENTATIVE DYSON asked Chair James what her intentions were in            
 regards to the bill today?                                                    
                                                                               
 CHAIR JAMES replied she did not have any intention.  She assumed it           
 would be passed out at some point.  A few amendments looked like              
 they were needed.                                                             
                                                                               
 Number 1635                                                                   
                                                                               
 SENATOR WARD stated it was very important that the Administration             
 be involved in the task force in the interest of the state.  He               
 understood the concerns, but they were unjustified fears.  He did             
 not believe that the Governor would veto the bill.  He also                   
 believed that the Governor would appoint members to the task force;           
 it would not work without his participation.                                  
                                                                               
 Number 1708                                                                   
                                                                               
 CHAIR JAMES announced she wanted to get a second legal opinion                
 before forming an opinion.  The bill would not be moved from the              
 committee today.                                                              
                                                                               
 Number 1750                                                                   
                                                                               
 MIKE McMULLEN, Personnel Manager, Division of Personnel, Department           
 of Administration, was the next person to testify in Juneau.  His             
 testimony was neither pro nor con today but to ensure that the                
 committee understood the process as we saw it.  Most of the                   
 collective bargaining contracts had provisions for a formal                   
 feasibility study in regards to contracting services out.  The                
 study had to be announced to the union with the ability to bid for            
 an alternative.  If the study indicated that money would be saved             
 then the state was free to contract the work and lay state                    
 employees off.  In addition, upon reviewing the recommendations in            
 November from the task force, the departments would be asking for             
 money and time to conduct their own feasibility study before the              
 effective dates.  The feasibility study would probably come up with           
 different results than the task force creating a conflict.  He did            
 not know a way around the potential conflict, however.                        
                                                                               
 Number 1956                                                                   
                                                                               
 CHAIR JAMES stated that her understanding of privatization was not            
 the same as contracting out.  The state could currently contract              
 out; it was generally a determination of the Administration and not           
 the legislature.  If the legislature privatized a part of                     
 government it would change the law.  She believed, for example,               
 that the permitting process for natural resources should be                   
 privatized.  It required professionals such as engineers.                     
 Therefore, if the public needed a permit, they could pay an                   
 engineer for the service.  Privatization was letting the public               
 sector compete and provide the service and not the government as              
 opposed to contracting out.                                                   
                                                                               
 Number 2099                                                                   
                                                                               
 MR. McMULLEN replied he agreed with her characterization of                   
 privatization.  The expectations of the bill, however, also                   
 included contracting out; and, unless the task force clarified its            
 purpose, the contracting out issue would come up.                             
                                                                               
 CHAIR JAMES replied she also continued to hear the term "out                  
 sourcing".  Privatization did not include out sourcing.                       
                                                                               
 Number 2172                                                                   
                                                                               
 FRANK SMITH was the first person to testify via teleconference in             
 Barrow.  He appreciated the testimony in regards to privatization             
 creating a monopoly.  There was already a great deal of influence             
 in Alaska of providers in the corrections field.  He was also                 
 concerned about the composition of the task force.  If the                    
 Governor's appointees were not included, the minority would only be           
 represented by two members causing a skewed outlook.  As a result,            
 the task force could not look at the real cost for example.  He               
 cited the cost of the prison in Arizona did not look at the chances           
 for parol being relocated so far from home and support.  He                   
 reiterated he was concerned that the providers would call the                 
 shots.                                                                        
                                                                               
 Number 2367                                                                   
                                                                               
 PAMELA LaBOLLE, President, Alaska State Chamber of Commerce, was              
 the next person to testify in Juneau.  The chamber was in favor of            
 privatization and SB 68.  A copy of our resolution had been                   
 provided to the committee members.  The resolution requested that             
 the legislature and Governor forge a plan by the end of 1997 to               
 implement a program to privatize the applicable services currently            
 provided by government.  The chamber had held privatization                   
 seminars in 1995 and 1996.  A general approach was taken in 1995 to           
 look at the services that had been privatized throughout the                  
 nation.  A focused approach on transportation was taken in 1996.              
                                                                               
 TAPE 97-46, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 MS. LaBOLLE further stated there were services that only the                  
 government could and should provide.  Alaska had grown beyond that            
 concept, however, now that there was less money.  The chamber was             
 not satisfied with what happened with the Long Range Financial                
 Planning Commission.  The intention was to study the issue and make           
 a recommendation for possible actions by the legislature because              
 the legislature represented the people of the state.  "We don't               
 like to see groups of people taking on that function."  The caveat,           
 therefore, was that the task force would make recommendations to              
 the legislature and based upon public input                                   
 the legislature would develop privatization plans.                            
                                                                               
 MS. LaBOLLE further commented on the quote by the Department of Law           
 indicating the power of a citizen group versus the power of a                 
 legislative group.  The Constitution of the United States said that           
 the political power resided with the people.                                  
 Number 0249                                                                   
                                                                               
 CHAIR JAMES replied an individual person could not come in and                
 vote, but an individual person could influence the vote.                      
                                                                               
 CHAIR JAMES read the following provision from the Alaska State                
 Chamber of Commerce's Resolution:                                             
                                                                               
 "THEREFORE, BE IT RESOLVED that the Alaska State Chamber of                   
 Commerce strongly encourages the privatization of those state                 
 services which could be competitively provided in the private                 
 sector; and"                                                                  
                                                                               
 CHAIR JAMES cited British Columbia, Canada sold all of their                  
 equipment to the incoming contractor for repair and maintenance of            
 their roads.  The provence was divided into districts for different           
 contractors.  The cost was about the same in the end but the                  
 economy improved because the money that the government spent went             
 to wages.  While the money that the private sector spent went into            
 the pockets of the people.  Therefore, effectiveness, efficiency              
 and competition needed to be looked at when addressing the issue of           
 privatization.  Competition needed to be looked at to prevent a               
 monopoly.                                                                     
                                                                               
 Number 0469                                                                   
                                                                               
 MS. LaBOLLE replied there was no reason why present governmental              
 organizations could not compete for the services on a level playing           
 field.  The pyramid of government where the tax payers were on the            
 bottom was inverted and would eventually topple - too much                    
 government and not enough private enterprise to support it.                   
                                                                               
 Number 0549                                                                   
                                                                               
 CHAIR JAMES explained she thought of these issue deeply because of            
 her accounting background.  She was not sure if current                       
 governmental organizations could compete for private services                 
 because if they did not win the bid they would be disbanded and not           
 available to compete the next time.  It was more of a placate.                
                                                                               
 CHAIR JAMES reiterated she would like to see a definition of the              
 term "privatization" separate from the terms "out sourcing" and               
 "contracting" for clarification.  She asked Ms. LaBolle if she                
 agreed a definition of privatization was needed?                              
                                                                               
 Number 0656                                                                   
                                                                               
 MS. LaBOLLE replied, "Yes."  It could be one of the tasks of the              
 task force.  In addition, the chamber did not buy the arguments of            
 the separation of powers.  If it was just a group of people looking           
 at the issue and making recommendations that could or could not be            
 followed by the legislature then it was not a problem.                        
 CHAIR JAMES announced she would get an opinion from the Legislative           
 Legal and Research Services in regards to the separation of powers            
 concern.  The bill would be held over until a later date yet to be            
 determined.                                                                   
                                                                               
 ADJOURNMENT                                                                   
                                                                               
 Number 0744                                                                   
                                                                               
 CHAIR JAMES adjourned the House State Affairs Standing Committee              
 meeting at 9:50 a.m.                                                          
                                                                               
                                                                               

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