Legislature(2017 - 2018)GRUENBERG 120

02/14/2017 03:00 PM STATE AFFAIRS

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 91 APOC REGISTRATION FEES; LOBBYIST TAX TELECONFERENCED
Heard & Held
-- Public Testimony --
+ HB 3 NATL GUARD LEAVE/REEMPLOYMENT RIGHTS TELECONFERENCED
Heard & Held
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
             HOUSE STATE AFFAIRS STANDING COMMITTEE                                                                           
                       February 14, 2017                                                                                        
                           3:01 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Jonathan Kreiss-Tomkins, Chair                                                                                   
Representative Chris Tuck                                                                                                       
Representative Adam Wool                                                                                                        
Representative Chris Birch                                                                                                      
Representative DeLena Johnson                                                                                                   
Representative Gary Knopp                                                                                                       
Representative Andy Josephson (alternate)                                                                                       
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Gabrielle LeDoux, Vice Chair                                                                                     
Representative Chuck Kopp (alternate)                                                                                           
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 91                                                                                                               
"An Act  relating to fees  for certain persons  filing disclosure                                                               
statements  or  other  reports with  the  Alaska  Public  Offices                                                               
Commission;  relating  to a  tax  on  legislative lobbyists;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 3                                                                                                                
"An Act relating to the employment rights of employees in the                                                                   
state who are members of the National Guard of another state,                                                                   
territory, or district of the United States."                                                                                   
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 91                                                                                                                   
SHORT TITLE: APOC REGISTRATION FEES; LOBBYIST TAX                                                                               
SPONSOR(s): REPRESENTATIVE(s) KITO                                                                                              
                                                                                                                                
01/30/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/30/17       (H)       STA, FIN                                                                                               
02/09/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
02/09/17       (H)       Heard & Held                                                                                           
02/09/17       (H)       MINUTE(STA)                                                                                            
02/14/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
                                                                                                                                
BILL: HB   3                                                                                                                  
SHORT TITLE: NATL GUARD LEAVE/REEMPLOYMENT RIGHTS                                                                               
SPONSOR(s): REPRESENTATIVE(s) TUCK                                                                                              
                                                                                                                                
01/18/17       (H)       PREFILE RELEASED 1/9/17                                                                                
01/18/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/18/17       (H)       MLV, STA                                                                                               
01/26/17       (H)       MLV AT 1:30 PM GRUENBERG 120                                                                           
01/26/17       (H)       Heard & Held                                                                                           
01/26/17       (H)       MINUTE(MLV)                                                                                            
02/02/17       (H)       MLV AT 1:30 PM GRUENBERG 120                                                                           
02/02/17       (H)       Moved CSHB 3(MLV) Out of Committee                                                                     
02/02/17       (H)       MINUTE(MLV)                                                                                            
02/03/17       (H)       MLV RPT CS(MLV) 7DP                                                                                    
02/03/17       (H)       DP:    LEDOUX,     SPOHNHOLZ,    PARISH,                                                               
                         RAUSCHER, SADDLER, REINBOLD, TUCK                                                                      
02/14/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
REPRESENTATIVE SAM KITO                                                                                                         
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  As prime sponsor, responded to questions                                                                 
during the hearing on HB 91.                                                                                                    
                                                                                                                                
CRYSTAL KOENEMAN, Staff                                                                                                         
Representative Sam Kito                                                                                                         
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Provided information and answered questions                                                              
during the hearing on HB 91, on behalf of Representative Kito,                                                                  
prime sponsor.                                                                                                                  
                                                                                                                                
HEATHER HEBDON, Executive Director                                                                                              
Alaska Public Offices Commission (APOC)                                                                                         
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Answered questions during the hearing on HB                                                              
91.                                                                                                                             
                                                                                                                                
PAM GOODE                                                                                                                       
Rural Deltana, Alaska                                                                                                           
POSITION STATEMENT:  Testified in opposition to HB 91.                                                                        
                                                                                                                                
KENDRA KLOSTER, Staff                                                                                                           
Representative Chris Tuck                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Answered questions  on HB  3 on  behalf of                                                             
Representative Tuck.                                                                                                            
                                                                                                                                
ROBERT DOEHL, Deputy Commissioner                                                                                               
U.S. Department of Military & Veterans' Affairs (DMVA)                                                                          
Joint Base Elmendorf-Richardson (JBER), Alaska                                                                                  
POSITION STATEMENT:   Testified in  support of HB 3  and answered                                                             
questions.                                                                                                                      
                                                                                                                                
MARK SAN SOUCI, Regional State Liaison                                                                                          
U.S. Department of Defense (DoD)                                                                                                
Lakewood, Washington                                                                                                            
POSITION STATEMENT:  Testified in support of HB 3.                                                                            
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:01:30 PM                                                                                                                    
                                                                                                                                
CHAIR  JONATHAN KREISS-TOMKINS  called  the  House State  Affairs                                                             
Standing   Committee    meeting   to    order   at    3:01   p.m.                                                               
Representatives  Birch, Johnson,  Josephson,  Knopp, and  Kreiss-                                                               
Tomkins were present at the  call to order.  Representatives Tuck                                                               
and Wool arrived as the meeting was in progress.                                                                                
                                                                                                                                
           HB 91-APOC REGISTRATION FEES; LOBBYIST TAX                                                                       
                                                                                                                                
3:03:18 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS  announced that the first  order of business                                                               
would be HOUSE BILL NO. 91,  "An Act relating to fees for certain                                                               
persons filing  disclosure statements  or other reports  with the                                                               
Alaska  Public   Offices  Commission;   relating  to  a   tax  on                                                               
legislative lobbyists; and providing for an effective date."                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS  opened public  testimony on  HB 91.   After                                                               
ascertaining  that there  was no  one who  wished to  testify, he                                                               
closed public testimony.                                                                                                        
                                                                                                                                
3:04:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SAM  KITO,  Alaska State  Legislature,  as  prime                                                               
sponsor of  HB 91,  expressed his  concern that  it is  not clear                                                               
that revenue  generated from the  lobbyist tax proposed in  HB 91                                                               
would  directly  benefit  the Alaska  Public  Offices  Commission                                                               
(APOC).   He mentioned that  staff is  working on changes  to the                                                               
bill to rectify this issue and make other improvements.                                                                         
                                                                                                                                
3:05:51 PM                                                                                                                    
                                                                                                                                
CRYSTAL KOENEMAN,  Staff, Representative  Sam Kito,  Alaska State                                                               
Legislature, on  behalf of Representative Kito,  prime sponsor of                                                               
HB  91,  referred  to  discussions in  the  House  State  Affairs                                                               
Standing Committee meeting of  02/09/17 regarding raising revenue                                                               
for APOC  to offset general fund  dollars and doing so  through a                                                               
tax  or a  fee.   She  mentioned  that amendments  to  HB 91  are                                                               
forthcoming to respond to concerns expressed in the hearing.                                                                    
                                                                                                                                
MS. KOENEMAN referred to Section 1  of HB 91, which states that a                                                               
candidate, group, or nongroup entity  is required to file reports                                                               
with APOC.   She said  that in response  to a request  from APOC,                                                               
staff will  add "persons" to  that section to broaden  the intent                                                               
to include additional groups such  as labor unions, corporations,                                                               
and   other  individuals.     She   stated  that   a  candidate's                                                               
registration fee would be for  the full election cycle instead of                                                               
just  12  months.    She  also noted  the  addition  of  language                                                               
specifying  the   civil  penalties   for  non-payment   of  filer                                                               
registration  fees,  which  was  inadvertently left  out  of  one                                                               
section of HB 91.                                                                                                               
                                                                                                                                
3:08:40 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH expressed that  he doesn't support an income                                                               
tax, but wouldn't oppose a flat  rate, whether it be per lobbyist                                                               
or per client.   He opined that the flat  fee is more manageable,                                                               
and it is fair and equitable.                                                                                                   
                                                                                                                                
3:09:52 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WOOL asked for the number of lobbyists.                                                                          
                                                                                                                                
3:10:24 PM                                                                                                                    
                                                                                                                                
HEATHER  HEBDON,   Executive  Director,  Alaska   Public  Offices                                                               
Commission (APOC),  responded that  the five-year  average number                                                               
of registered lobbyists is approximately 132.                                                                                   
                                                                                                                                
3:11:02 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK referred  to  the addition  of "persons"  to                                                               
Section 1 of HB 91 and said  that "persons" is one of the reasons                                                               
we  have Citizens  United.    He added  that  the courts  haven't                                                               
differentiated  between  natural  beings and  artificial  beings;                                                               
therefore,  corporations  have  First Amendment  rights  and  the                                                               
ability to use their general funds for unlimited contributions.                                                                 
                                                                                                                                
REPRESENTATIVE  TUCK offered  that the  burden of  overseeing the                                                               
finances  of lobbyists  with larger  revenue  streams is  greater                                                               
than for  the smaller  groups, so  it makes sense  to have  a fee                                                               
structure based on revenue.                                                                                                     
                                                                                                                                
3:12:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH cited  the  information on  page  2 of  the                                                               
Department of Revenue's  (DOR's) fiscal note:   the average total                                                               
fees paid to  lobbyists were about $17 million and  a 2.5 percent                                                               
tax would  generate about $425,000  in annual revenue.   He asked                                                               
for  an explanation  of the  discrepancy between  the amounts  of                                                               
anticipated revenue - $425,000 listed  on the DOR fiscal note and                                                               
$244,000 listed  on the sponsor  statement.  He offered  that 130                                                               
lobbyists, each  paying a  $2,000 fee,  would generate  an amount                                                               
like that proposed.                                                                                                             
                                                                                                                                
REPRESENTATIVE  KITO explained  that  the  sponsor statement  was                                                               
based on  APOC information  from a  year and a  half ago  and DOR                                                               
used current  information.   He stated that  the DOR  estimate of                                                               
$425,000  does  not  acknowledge  the  removal  of  the  existing                                                               
lobbying fee proposed by HB  91, which amounts to about $106,000.                                                               
He said  deducting $106,000 from $425,000  yields about $380,000.                                                               
He  promised  a  revised  sponsor statement  with  the  committee                                                               
substitute (CS).                                                                                                                
                                                                                                                                
3:14:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KNOPP offered that  besides passing legislation to                                                               
raise  revenue,  it  is  the  responsibility  of  legislators  to                                                               
examine how departments conduct  their business and then consider                                                               
modifications.   He asserted  that the  legislative body  has not                                                               
had that discussion, nor has it  taken a balanced approach to the                                                               
budget  process.   He  suggested  that  APOC fees  and  reporting                                                               
requirements discourage  candidates and appointees of  boards and                                                               
commissions from seeking public office.                                                                                         
                                                                                                                                
REPRESENTATIVE  KNOPP referred  to the  sponsor statement,  which                                                               
states  that  APOC's budget  was  reduced  from $1.3  million  in                                                               
fiscal year 2015 (FY 15) to $866,000  in FY 16.  He asserted that                                                               
the reduced amount  occurred only in that one year.   He referred                                                               
to  the APOC  funding document  in the  committee packet,  titled                                                               
"Multi-year Allocation  Totals with Funding -  Operating Budget -                                                               
FY 2017 Conf Committee Structure,"  and noted funding for 2017 at                                                               
$1.033  million, with  $1,050  million in  the  FY 18  governor's                                                               
budget.  He  reiterated his belief that the  legislature needs to                                                               
have  discussions  about  conducting   business  and  a  balanced                                                               
approach  to the  budget,  not  just for  APOC  but  for all  the                                                               
state's agencies and departments.   He asked if those discussions                                                               
have taken place.                                                                                                               
                                                                                                                                
REPRESENTATIVE KITO  asserted that APOC's budget  was reduced and                                                               
the agency is  struggling to meet its statutory  obligations.  He                                                               
said that the legislature  authorized additional program receipts                                                               
- the  $1,033 million figure  on the document -  which represents                                                               
what the  legislature considered to  be the appropriate  level of                                                               
funding for APOC.  He went  on to say that his primary motivation                                                               
for  introducing HB  91  is to  create a  mechanism  for APOC  to                                                               
collect  receipts  more than  $106,000  and  up to  the  $240,000                                                               
authorized  by the  legislature.   His  secondary motivation,  he                                                               
said, is  to increase  APOC staff in  Juneau to  provide adequate                                                               
oversight of lobbying activities.                                                                                               
                                                                                                                                
3:18:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KNOPP  expressed his  concern that there  would be                                                               
additional  oversight  requirements  for   APOC  and  fees  would                                                               
escalate.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  KITO responded  that  APOC operated  at a  stable                                                               
staffing level before  reductions put pressure on  its ability to                                                               
do some  of the  audits.   He mentioned that  he did  not foresee                                                               
uncontrolled  growth for  the  organization.   He  said that  the                                                               
legislature would continue  to review the APOC  budget and assess                                                               
APOC's   performance   annually   through   the   Department   of                                                               
Administration (DOA).   He added  that the legislature  may audit                                                               
the  agency to  determine  if it  is  performing the  statutorily                                                               
designated functions.   He emphasized the  importance of allowing                                                               
APOC to  collect revenue up  to the receipt authority  amount and                                                               
the  need   for  additional  support  to   perform  its  lobbying                                                               
oversight activities.                                                                                                           
                                                                                                                                
3:20:15 PM                                                                                                                    
                                                                                                                                
CHAIR  KREISS-TOMKINS asked  what oversight  activities APOC  has                                                               
been unable to fulfill.                                                                                                         
                                                                                                                                
REPRESENTATIVE KITO replied that his  understanding is there is a                                                               
need  to hire  a professional  who can  understand and  interpret                                                               
statute  and   provide  advice   to  lobbyists   filing  reports.                                                               
Currently there is just a clerk performing those duties.                                                                        
                                                                                                                                
3:21:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON  asked if Representative  Kito anticipated                                                               
that taxes on  other professions would be  "imbedded" in statute.                                                               
She expressed  her concern with maintaining  simplicity regarding                                                               
taxes in state law.                                                                                                             
                                                                                                                                
REPRESENTATIVE  KITO  responded   that  the  lobbying  profession                                                               
regulated under APOC  is a unique function and is  not related to                                                               
other  professions that  are regulated  under  the Department  of                                                               
Commerce,  Community &  Economic  Development (DCCED).   He  said                                                               
that   the  professions   performing  licensing   activities  and                                                               
investigations  under DCCED  are already  required to  "pay their                                                               
own way,"  and the fees are  adjusted every other year  for those                                                               
professions.  All  the activities associated with  the boards are                                                               
paid for  by the licensees  and registrants.   He said  that APOC                                                               
has  been supported  by general  fund  revenue and  the $250  per                                                               
client  fee,   which  has  generated   a  little   over  $100,000                                                               
historically.    He  asserted that  nothing  requires  that  APOC                                                               
operations are  supported entirely  by the professions  that they                                                               
regulate.   He  offered  that such  a  requirement would  greatly                                                               
increase APOC  fees.  He  maintained that  HB 91 was  proposed to                                                               
raise revenue  just to the  level of program  receipts authorized                                                               
by the  legislature and  to provide for  better oversight  in the                                                               
lobbying office.   He speculated  that requiring  the professions                                                               
regulated  by APOC  to pay  their own  way would  result in  much                                                               
higher fees than those proposed in HB 91.                                                                                       
                                                                                                                                
3:24:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WOOL cited the  financial disclosure reporting fee                                                               
of $50 in HB 91 and asked  what the current fee was for financial                                                               
disclosure.                                                                                                                     
                                                                                                                                
REPRESENTATIVE KITO responded  that there is not  currently a fee                                                               
for financial disclosure reporting.                                                                                             
                                                                                                                                
REPRESENTATIVE WOOL asked what the  current candidate fee was for                                                               
filing with APOC.                                                                                                               
                                                                                                                                
REPRESENTATIVE KITO replied  that there is currently  not an APOC                                                               
candidate fee.  The $100 filing fee in HB 91 would be a new fee.                                                                
                                                                                                                                
REPRESENTATIVE  WOOL  suggested  that other  professional  groups                                                               
with similar  membership size are  self-funded, and  fees include                                                               
investigations;  whereas,  APOC's  expenses  are  higher  because                                                               
investigations  are  ongoing.   He  offered  that  investigations                                                               
involving the other boards are performed as needed.                                                                             
                                                                                                                                
REPRESENTATIVE  KITO responded  that he  does not  believe APOC's                                                               
oversight of  regulation or licensing functions  is comparable to                                                               
the   Division  of   Corporations,  Business,   and  Professional                                                               
Licensing (CBPL).   He  stated that there  are two  components to                                                               
APOC  activity:     one  is   oversight  of  the   132  lobbyists                                                               
representing the 400-plus clients  accessing the legislature; and                                                               
the other  is oversight  of the group  of candidates  running for                                                               
political  office.    He  said  that for  oversight  of  all  the                                                               
registered candidates  and groups, the estimated  revenue is less                                                               
than $20,000.  He attested that  APOC would not have enough money                                                               
for  candidate review  and would  still need  general funds.   He                                                               
offered  that through  HB 91,  there would  be an  opportunity to                                                               
generate  funds  from  professional   lobbying  to  pay  for  the                                                               
oversight of their reporting requirements.                                                                                      
                                                                                                                                
3:27:45 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS opened public testimony on HB 91.                                                                          
                                                                                                                                
3:28:21 PM                                                                                                                    
                                                                                                                                
PAM GOODE  testified that she opposes  HB 91.  She  expressed her                                                               
belief  that APOC  should  be downsized,  as it  has  a very  bad                                                               
reputation  among anyone  running for  office.   She opined  that                                                               
APOC  discourages "good"  people from  running for  office.   She                                                               
mentioned  that when  APOC  was  formed in  1976,  there were  no                                                               
computers, and now  it is in violation of Article  I, Section 22.                                                               
She  asserted that  APOC requests  information that  is not  even                                                               
required  by the  IRS  and publishes  it on  the  Internet.   She                                                               
opined that  "the reason  APOC is overloaded  is because  they do                                                               
petty things."   She mentioned that  APOC has wasted her  time on                                                               
very simple  matters, and  it audits filings  that are  less than                                                               
$100.   She  offered that  instead of  looking for  ways to  fund                                                               
agencies, the  legislature should look  at ways "to  release them                                                               
of the  pettiness."   She asserted  that APOC  is supposed  to be                                                               
"going  after  the  bad  guys"  and  not  deterring  people  from                                                               
participating.   She opined  that people  running for  office and                                                               
commissioners "won't  step up" because  of what is  required from                                                               
APOC.  She mentioned that  her husband warned her against running                                                               
for office because  of what APOC is doing.   She relayed that she                                                               
let APOC  "violate" her privacy so  that she could "do  the right                                                               
thing" and run for office.                                                                                                      
                                                                                                                                
3:31:14 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS closed public testimony on HB 91.                                                                          
                                                                                                                                
3:31:34 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON commented that  his experience with APOC                                                               
has  not been  unfavorable,  nor did  he  think the  commission's                                                               
requirements  unreasonable.   He  expressed  his  alarm over  the                                                               
level of funding for APOC in  the budget that was before him last                                                               
March [2016] and  said he appreciated that some of  the money was                                                               
restored.  He  opined that it would be impossible  for the agency                                                               
to perform  its work  successfully with  that [reduced]  level of                                                               
funding.                                                                                                                        
                                                                                                                                
REPRESENTATIVE JOSEPHSON  cited the U.S. District  Court decision                                                               
of 2016  upholding the constitutionality of  Alaska's $500 annual                                                               
personal  campaign   contribution  limit,  which  has   now  been                                                               
appealed.  He  mentioned that the presence of  money in campaigns                                                               
is  only going  to increase  and  "soft" money  is growing  every                                                               
election cycle.   He stated the importance of  information to the                                                               
public.    He  suggested  that  there  be  a  waiver  system  for                                                               
candidate  filing fees  in the  case of  a plea  of poverty.   He                                                               
contended that  in such  a case,  the money  could not  be raised                                                               
prior to filing.  He expressed  the need for creative funding and                                                               
for a fiscal plan.                                                                                                              
                                                                                                                                
3:34:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH  stated that  $17 million in  average annual                                                               
fees  paid to  lobbyists comes  to $266,000  per legislator.   He                                                               
asked for the number of lobbyist clients.                                                                                       
                                                                                                                                
MS. HEBDON answered  that there are 480 clients,  and APOC raises                                                               
about $120,000 per year through  the $250 per client registration                                                               
fee.                                                                                                                            
                                                                                                                                
REPRESENTATIVE BIRCH asked if the client pays the $250 fee.                                                                     
                                                                                                                                
MS.  HEBDON responded  that lobbyists  pay the  $250 for  each of                                                               
their clients.                                                                                                                  
                                                                                                                                
REPRESENTATIVE BIRCH asked if lobbyists pay an additional fee.                                                                  
                                                                                                                                
MS. HEBDON responded no.                                                                                                        
                                                                                                                                
3:36:24 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  WOOL  asked if  "$250  per  client per  lobbyist"                                                               
means  that if  a client  hires four  lobbyists, then  four times                                                               
$250 is paid.                                                                                                                   
                                                                                                                                
MS. HEBDON responded that is correct.                                                                                           
                                                                                                                                
REPRESENTATIVE  WOOL  asked if  HB  91  and  a state  income  tax                                                               
together would result in the "double taxing" of lobbyists.                                                                      
                                                                                                                                
REPRESENTATIVE KITO conceded that to  be one of the complications                                                               
of two  taxes.  He stated  that the gross receipts  that would be                                                               
taxed  at  2.5 percent  would  be  independent  of the  income  a                                                               
lobbyist  claims on  his tax  form,  which is  subject to  income                                                               
adjustments.  He asserted that  a forthcoming CS will address the                                                               
issue  of the  2.5  percent income  tax  in HB  91  to avoid  the                                                               
perception of double taxation.                                                                                                  
                                                                                                                                
[HB 91 was held over.]                                                                                                          
                                                                                                                                
           HB 3-NATL GUARD LEAVE/REEMPLOYMENT RIGHTS                                                                        
                                                                                                                                
3:40:25 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS  announced that the final  order of business                                                               
would be  HOUSE BILL NO.  3, "An  Act relating to  the employment                                                               
rights of employees in the state  who are members of the National                                                               
Guard  of another  state, territory,  or district  of the  United                                                               
States."                                                                                                                        
                                                                                                                                
[Before  the committee  was committee  substitute (CS)  for HB  3                                                               
(MLV).]                                                                                                                         
                                                                                                                                
3:40:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  presented  HB  3, as  prime  sponsor.    He                                                               
relayed that HB 3 would  allow for employment rights of employees                                                               
of the  state who are  members of  the National Guard  of another                                                               
state,  territory,  or  district  of   the  United  States.    He                                                               
paraphrased  from the  Sponsor  Statement,  which read  [original                                                               
punctuation provided]:                                                                                                          
                                                                                                                                
     House  Bill   3  seeks  to  correct   a  deficiency  in                                                                    
     employment protections for Alaskans  who are serving in                                                                    
     the  National Guard.  This is  a  nationwide effort  to                                                                    
     ensure those who  serve their nation for  all 50 states                                                                    
     when  called  to duty  -  regardless  of their  service                                                                    
     location  -  will  have reemployment  rights  to  their                                                                    
     Alaskan  civilian  job  after  completing  the  various                                                                    
     critical  duties when  called by  a governor  for state                                                                    
     active duty.                                                                                                               
                                                                                                                                
     The National  Guard is  a hybrid  state-federal entity.                                                                    
     While  National Guard  members are  subject to  federal                                                                    
     call to  duty by  the President  of the  United States,                                                                    
     they can  also be  called up for  state active  duty by                                                                    
     the Governor  to respond to  state emergencies  such as                                                                    
     fires, tornadoes and floods.                                                                                               
                                                                                                                                
     The  federal  law  Uniformed  Services  Employment  and                                                                    
     Reemployment  Rights Act  (USERRA) protects  members of                                                                    
     the Army  or Air  National Guard  when they  are called                                                                    
     away from their civilian jobs for federal service.                                                                         
                                                                                                                                
     However, USERRA  does not apply  when a  National Guard                                                                    
     member must leave  their job for state  active duty. If                                                                    
     National Guard members are  to have reemployment rights                                                                    
     after state active duty, it must be through state law.                                                                     
                                                                                                                                
     Alaska currently  has a law that  applies to employment                                                                    
     protections  to  the   public  and  private  employees.                                                                    
     However,  it is  explicitly limited  to members  of the                                                                    
     Alaska Army  or Air  National Guard. There  are several                                                                    
     Alaskan residents  who serve  in the National  Guard of                                                                    
     another  state. These  Alaskans currently  do not  have                                                                    
     the reemployment protections for their employment.                                                                         
                                                                                                                                
     By passing House Bill 3,  we will extend the employment                                                                    
     protections  to   Alaskans  who  are  serving   in  any                                                                    
     National   Guard.  The   Department   of  Defense   has                                                                    
     identified this  legislation as a  key quality  of life                                                                    
     issue  and  is actively  seeking  to  make this  policy                                                                    
     change across the nation. So  far, 28 other states have                                                                    
     passed  similar  legislation  and 3  other  states  are                                                                    
     taking it up this session.                                                                                                 
                                                                                                                                
3:43:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH  asked for  an  explanation  as to  why  an                                                               
Alaskan would  be serving in  another state's National  Guard and                                                               
not Alaska's.   He also asked  how many people would  be impacted                                                               
by HB 3.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  TUCK  responded  that   there  are  many  Alaskan                                                               
workers, who live  and raise families in Alaska,  but are members                                                               
of  the National  Guard in  other states.   He  asserted that  if                                                               
those guard  members are called back  to the state in  which they                                                               
serve, then HB 3 would enable  them to resume their employment in                                                               
Alaska upon return,  like a Guard member who was  called to serve                                                               
oversees by the President of the United States.                                                                                 
                                                                                                                                
3:44:38 PM                                                                                                                    
                                                                                                                                
KENDRA KLOSTER,  Staff, Representative  Chris Tuck,  Alaska State                                                               
Legislature, on  behalf of Representative Tuck,  prime sponsor of                                                               
HB  3, relayed  that  recent  data from  the  U.S. Department  of                                                               
Defense (DoD)  identified 33 individuals  in Alaska who  serve in                                                               
the National  Guard in 19 other  states.  She conceded  that this                                                               
number is the result of self-reporting, and there may be more.                                                                  
                                                                                                                                
REPRESENTATIVE  BIRCH   asked  for  clarification  on   how  this                                                               
situation  occurs.   He  asked  if  someone,  who served  in  the                                                               
National Guard of  another state and moved to  Alaska, would have                                                               
the opportunity  to transfer  his/her National  Guard affiliation                                                               
to Alaska.                                                                                                                      
                                                                                                                                
MS. KLOSTER  responded that there  is a process  for transferring                                                               
to another  state's National Guard,  and some members  are called                                                               
back  to the  original state  of  service before  the process  is                                                               
complete.                                                                                                                       
                                                                                                                                
3:46:27 PM                                                                                                                    
                                                                                                                                
ROBERT  DOEHL,  Deputy  Commissioner, Department  of  Military  &                                                               
Veterans'  Affairs  (DMVA),  cited  reasons why  members  of  the                                                               
National Guard would be living  in one state and performing guard                                                               
duty  in  another.     He  explained  that   often  the  civilian                                                               
professional personal life  of a guard member "gets  out of sync"                                                               
with his/her  military career.   He  relayed that  this situation                                                               
occurs  most often  with students,  military  spouses, and  those                                                               
with civilian careers  requiring frequent work out of  state.  He                                                               
stated that  for professional  reasons, guard  members go  out of                                                               
state to get  training and experience that cannot  be obtained in                                                               
Alaska.   He added  that this  situation also  occurs due  to the                                                               
time it  takes to get into  the Alaska National Guard  (ANG).  He                                                               
contended that when  he moved to Alaska, getting into  ANG was an                                                               
11-month  process.   He mentioned  that guard  members leave  the                                                               
state for professional  development.  An Alaska  guard member may                                                               
start  his/her career  Outside  in a  position  not available  in                                                               
Alaska, which  would make him/her  far more valuable to  ANG upon                                                               
return.                                                                                                                         
                                                                                                                                
MR. DOEHL related  three personal examples in  which his military                                                               
career was out of sync with  his personal life.  After graduating                                                               
from  college,  he  moved  to  another  state  for  a  job  while                                                               
continuing to "drill"  in his original state.   After getting off                                                               
active duty and  finishing law school, he  continued to affiliate                                                               
with  the  [Army]   Reserve  in  the  Midwest   while  living  in                                                               
Washington,  D.C.,  to  finish  command  tour  of  the  unit  and                                                               
transition for  two years.   When he moved  to Alaska and  was in                                                               
the process  of transferring  to ANG, he  continued to  travel to                                                               
Newport  News, Virginia,  to command  a unit  and maintain  pilot                                                               
proficiency.                                                                                                                    
                                                                                                                                
MR. DOEHL  noted the  money spent by  the United  States training                                                               
him as a  military pilot, which was "well into  six figures."  He                                                               
also  noted  the money  saved  because  he maintained  his  pilot                                                               
proficiency  in another  state while  he  was in  the process  of                                                               
joining the Alaska Air National Guard  (AK ANG).  He offered that                                                               
"cross-state affiliation"  may be  common Outside, where  one can                                                               
drive  across three  states in  an hour;  however, for  the guard                                                               
member living in Alaska, the  time, distance, and cost factors of                                                               
an  Outside   National  Guard  affiliation   highly  incentivizes                                                               
finding a path  into ANG.  He emphasized that  DMVA supports HB 3                                                               
because  it  would  be conducive  to  developing  a  professional                                                               
militia in  Alaska; it  would allow a  continuity of  service for                                                               
those Alaskans whose life plans  require them to move Outside for                                                               
a period;  and it also  would incentivize new Alaskans  to remain                                                               
engaged with  the military from  a prior affiliation,  until they                                                               
can become  a member of ANG.   He concluded that  maintaining the                                                               
participation  and  readiness  of these  guard  members  supports                                                               
recruitment,  saves  money,  and  provides  for  a  more  capable                                                               
National Guard serving Alaskans.                                                                                                
                                                                                                                                
3:50:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH asked if there  are employers who won't take                                                               
back employees  who have  been serving in  the National  Guard in                                                               
another state.                                                                                                                  
                                                                                                                                
MR. DOEHL answered that since  there is currently no mechanism in                                                               
place to address  this situation, no incidents  have been brought                                                               
to  the attention  of DMVA.   He  mentioned that  USERRA protects                                                               
[the employment  of] guard  members who  have been  mobilized for                                                               
periods of  service for federal  duties.  He mentioned  that most                                                               
state active duty  is of short duration; however, in  the case of                                                               
[the after effects  of] Hurricane Katrina, guard  duty lasted for                                                               
months, resulting  in difficult decisions and  adverse actions by                                                               
employers.                                                                                                                      
                                                                                                                                
REPRESENTATIVE BIRCH asked for  confirmation that currently there                                                               
are  no guard  members who  have been  denied the  opportunity to                                                               
return to his/her job.  He  suggested that HB 3 was introduced to                                                               
be proactive and not to address any current situations.                                                                         
                                                                                                                                
MR. DOEHL responded that is correct.                                                                                            
                                                                                                                                
3:52:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  WOOL asked  if  a member  of  the National  Guard                                                               
serves one  weekend per month and  two weeks per year.   He asked                                                               
if a  guard member, who  is currently living  in Alaska but  is a                                                               
member  of another  state's National  Guard, flies  back to  that                                                               
state with that frequency.                                                                                                      
                                                                                                                                
REPRESENTATIVE TUCK responded yes.                                                                                              
                                                                                                                                
MR. DOEHL  answered that the bare  minimum participation averages                                                               
one weekend per  month and two weeks of continuous  training.  He                                                               
offered  that National  Guard duty  has  not been  at that  "bare                                                               
minimum"  level  of  training since  [the  terrorist  attacks  of                                                               
September 11,  2001].   He added  that in  his case,  to maintain                                                               
flight proficiency,  monthly and  twice monthly  training periods                                                               
were  required.     He  said  that  depending   on  the  military                                                               
occupational  skills,  some  guard  members can  go  out  once  a                                                               
quarter for six days to  fulfill the training requirements rather                                                               
than monthly, to save time and  expense.  He added that there are                                                               
already  federal  protections in  place  for  drill weekends  and                                                               
annual training.   He  asserted that  HB 3  would apply  to state                                                               
active duty for specific disasters and state needs.                                                                             
                                                                                                                                
REPRESENTATIVE WOOL  mentioned that  he didn't realize  there was                                                               
so much specialized training associated  with the National Guard.                                                               
He  offered  that   by  joining  other  states   that  allow  the                                                               
[employment]  protection, Alaska  would  increase  the number  of                                                               
guard  members  joining  ANG, as  opposed  to  maintaining  their                                                               
membership in another state's National  Guard.  He suggested that                                                               
a guard member  from another state would move to  Alaska and keep                                                               
up his/her  out-of-state National  Guard membership  until he/she                                                               
could transition to ANG.                                                                                                        
                                                                                                                                
MR. DOEHL  responded that the  protections [in HB 3}  would allow                                                               
an  individual  to  continue  to   participate  with  an  Outside                                                               
organization.  He maintained, however,  that travel time and cost                                                               
incentivize affiliation in ANG for  those guard members and added                                                               
that Alaska is the best place to train.                                                                                         
                                                                                                                                
3:56:18 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS opened public testimony on HB 3.                                                                           
                                                                                                                                
MARK  SAN  SOUCI,  Regional State  Liaison,  U.S.  Department  of                                                               
Defense  (DoD),  testified  that  28  states  are  providing  the                                                               
protection that would  be offered in HB 3 and  three other states                                                               
have  introduced  legislation.   He  offered  the example  of  an                                                               
Alaskan  resident, who  is  a  member of  the  National Guard  in                                                               
Washington or  Oregon, being  called up  for 30  days to  fight a                                                               
forest  fire.   He  suggested that  without  the protection  that                                                               
would be  offered under HB  3, he/she  might be fired  because of                                                               
his/her absence.   He mentioned that DoD addressed this  as a key                                                               
issue three  years ago.   He reiterated  that there are  33 self-                                                               
reported guard members in Alaska serving  in 19 other states.  He                                                               
went  on to  list  the states:    Alabama, Arkansas,  California,                                                               
Florida,  Hawaii,  Massachusetts, Minnesota,  Missouri,  Montana,                                                               
North  Carolina,   North  Dakota,   Nevada,  New   York,  Oregon,                                                               
Tennessee, Texas, Utah, Washington, and  West Virginia.  He added                                                               
that these guard  members are serving in the  other states either                                                               
for professional development  or because they are  in the process                                                               
of transferring to ANG.  He concluded  that the intent of HB 3 is                                                               
to  protect those  Alaskans who  are  doing that  "good duty"  of                                                               
serving in the National Guard in other states.                                                                                  
                                                                                                                                
3:59:44 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS closed public testimony on HB 3.                                                                           
                                                                                                                                
REPRESENTATIVE  KNOPP asked  if HB  3 would  apply to  people who                                                               
work two weeks on and two weeks  off in Alaska and are members of                                                               
a National Guard in another state.                                                                                              
                                                                                                                                
REPRESENTATIVE  TUCK   replied  yes,   because  their   place  of                                                               
employment is  in Alaska.   The proposed legislation  would apply                                                               
to Alaskan employers.                                                                                                           
                                                                                                                                
REPRESENTATIVE TUCK mentioned that HB  3 was amended in the House                                                               
Special Committee  on Military and Veterans'  Affairs meeting [of                                                               
2/2/2017] to insert  a new subsection (h) under  Section 3, which                                                               
states  that there  would be  an exemption  for the  reemployment                                                               
rights of  a guard member  "if the employer's  circumstances have                                                               
changed,  making employment  impossible or  unreasonable, or  the                                                               
employment would impose any undue  hardship on the employer."  He                                                               
asserted  that this  amendment created  a balance:   making  sure                                                               
that a National  Guard member, serving honorably,  would have the                                                               
ability return  to his/her job  if it didn't create  any hardship                                                               
on the employer at the same time.                                                                                               
                                                                                                                                
[HB 3 was held over.]                                                                                                           
                                                                                                                                
4:02:52 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
State Affairs  Standing Committee  meeting was adjourned  at 4:02                                                               
p.m.                                                                                                                            

Document Name Date/Time Subjects
HB003 ver D 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3
HB003 Sponsor Statement 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3
HB003 Memo of Changes 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3
HB003 Fiscal Note DOLWD 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3
HB003 Fiscal Note MVA 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3
HB003 Supporting Document-Letter Dept of Defense 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3
HB003 Supporting Document-Dept of Defense One Pager 2.7.17.pdf HSTA 2/14/2017 3:00:00 PM
HB 3