Legislature(2017 - 2018)BARNES 124

03/07/2017 01:30 PM TRANSPORTATION


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01:30:47 PM Start
01:31:46 PM HB132
02:54:02 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 132 TRANSPORTATION NETWORK COMPANIES TELECONFERENCED
Moved CSHB 132(TRA) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
                     ALASKA STATE LEGISLATURE                                                                                 
             HOUSE TRANSPORTATION STANDING COMMITTEE                                                                          
                          March 7, 2017                                                                                         
                            1:30 p.m.                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Louise Stutes, Co-Chair                                                                                          
Representative Adam Wool, Co-Chair                                                                                              
Representative Matt Claman                                                                                                      
Representative Harriet Drummond                                                                                                 
Representative Chuck Kopp                                                                                                       
Representative Mark Neuman                                                                                                      
Representative Colleen Sullivan-Leonard                                                                                         
Representative David Eastman (alternate)                                                                                        
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Gabrielle LeDoux (alternate)                                                                                     
                                                                                                                                
OTHER LEGISLATORS PRESENT                                                                                                     
                                                                                                                                
Representative Dan Saddler                                                                                                      
Representative George Rauscher                                                                                                  
Representative Justin Parish                                                                                                    
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 132                                                                                                              
"An Act relating to transportation network companies and                                                                        
transportation network company drivers."                                                                                        
                                                                                                                                
     - MOVED CSHB 132(TRA) OUT OF COMMITTEE                                                                                     
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 132                                                                                                                  
SHORT TITLE: TRANSPORTATION NETWORK COMPANIES                                                                                   
SPONSOR(s): REPRESENTATIVE(s) WOOL                                                                                              
                                                                                                                                
02/15/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/15/17       (H)       TRA, L&C                                                                                               
02/23/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
02/23/17       (H)       <Bill Hearing Canceled>                                                                                
02/28/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
02/28/17       (H)       Heard & Held                                                                                           
02/28/17       (H)       MINUTE(TRA)                                                                                            
03/02/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
03/02/17       (H)       Heard & Held                                                                                           
03/02/17       (H)       MINUTE(TRA)                                                                                            
03/06/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
03/06/17       (H)       Scheduled but Not Heard                                                                                
03/07/17       (H)       TRA AT 1:30 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
RAFEAL BARBOSA                                                                                                                  
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in opposition to HB 132.                                                                       
                                                                                                                                
ARMAND FELICIANO, Vice President                                                                                                
Property Casualty Insurers Association of America (PCI)                                                                         
Sacramento, California                                                                                                          
POSITION STATEMENT:  Testified in support of HB 132.                                                                          
                                                                                                                                
JARED EBER, Associate Counsel                                                                                                   
Insurance                                                                                                                       
Uber Technologies Inc.                                                                                                          
San Francisco, California                                                                                                       
POSITION STATEMENT:  Answered questions during the hearing on HB
132.                                                                                                                            
                                                                                                                                
MITCHEL MATTHEWS, Senior Operations Manager                                                                                     
Pacific Northwest Region                                                                                                        
Uber Technologies Inc.                                                                                                          
Seattle, Washington                                                                                                             
POSITION STATEMENT: Answered questions during the hearing on HB
132.                                                                                                                            
                                                                                                                                
ANNABEL CHANG, Director                                                                                                         
Public Policy                                                                                                                   
Lyft, Inc.                                                                                                                      
San Francisco, California                                                                                                       
POSITION STATEMENT:  Answered questions during the hearing on HB
132.                                                                                                                            
                                                                                                                                
MIKE RICKER, Actuary P/C                                                                                                        
Division of Insurance                                                                                                           
Department of Commerce, Community & Economic Development (DCCED)                                                                
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions during the hearing on HB
132.                                                                                                                            
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:30:47 PM                                                                                                                    
                                                                                                                                
CO-CHAIR LOUISE  STUTES called the House  Transportation Standing                                                             
Committee meeting  to order at 1:30  p.m. Representatives Stutes,                                                               
Wool,  Drummond, Claman,  and Sullivan-Leonard,  were present  at                                                               
the call  to order.   Representatives Kopp,  Eastman (alternate),                                                               
and  Neuman arrived  as the  meeting was  in progress.   Also  in                                                               
attendance were Representatives Saddler, Rauscher, and Parish.                                                                  
                                                                                                                                
             HB 132-TRANSPORTATION NETWORK COMPANIES                                                                        
                                                                                                                                
1:31:46 PM                                                                                                                    
                                                                                                                                
CO-CHAIR STUTES announced  that the only order  of business would                                                               
be  HOUSE  BILL  NO.  132, "An  Act  relating  to  transportation                                                               
network  companies and  transportation network  company drivers."                                                               
[Before the committee was the  proposed committee substitute (CS)                                                               
for HB 132,  Version 30-LS0522\J, Wallace, 2/27/17,  adopted as a                                                               
work  draft during  the House  Transportation Standing  Committee                                                               
meeting on 3/21/17.]                                                                                                            
                                                                                                                                
1:32:50 PM                                                                                                                    
                                                                                                                                
RAFEAL  BARBOSA,   as  a  long-time  taxi   driver,  opined  that                                                               
transportation network  company (TNC)  actually stands  for "taxi                                                               
not in  compliance."  He  said that  the network system  TNCs use                                                               
could  have  easily  been  adopted  by  the  already  established                                                               
business of  taxi cab companies.   He opined that cities  such as                                                               
San Francisco, Seattle,  and New York must have  been sleeping or                                                               
not  paying  attention  when they  allowed  TNCs  and  completely                                                               
abandoned the taxi  cab force.  He pointed out  that TNCs come in                                                               
and purchase  medallions for  upwards of  $500,000.   He surmised                                                               
that TNCs are pushing taxis to  the brink of extinction, not only                                                               
in the  three aforementioned cities  but also  in 47 states.   He                                                               
offered his  belief that it looks  as though Alaska is  next.  He                                                               
gave the analogy  that what is happening with TNCs  and taxi cabs                                                               
is  just  like  Walmart  eliminating  mom and  pop  stores.    He                                                               
surmised  that allowing  TNCs to  operate  unregulated is  giving                                                               
them a  premium not afforded to  taxi cabs.  He  declared that he                                                               
paid close  to $120,000 for  his taxi  cab permit.   He concluded                                                               
that a level playing field is important.                                                                                        
                                                                                                                                
1:36:02 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CLAMAN asked  Mr. Barbosa whether he  owns his own                                                               
taxi permit or drives for someone else.                                                                                         
                                                                                                                                
MR. BARBOSA answered that he does both.                                                                                         
                                                                                                                                
REPRESENTATIVE CLAMAN  inquired whether  the owner of  the permit                                                               
and the taxi or the driver  of the taxi is responsible for paying                                                               
for insurance.                                                                                                                  
                                                                                                                                
MR. BARBOSA  answered the owner.   He  added that the  owner also                                                               
pays for the maintenance, insurance, and dispatch.                                                                              
                                                                                                                                
REPRESENTATIVE CLAMAN asked  what, if any, is  the required level                                                               
of insurance coverage.                                                                                                          
                                                                                                                                
MR.  BARBOSA  said  it  is $300,000  "for  personal  and  private                                                               
property," $100,000 for  something he said he  does not remember,                                                               
and $50,000 "for uninsured coverage."                                                                                           
                                                                                                                                
REPRESENTATIVE  CLAMAN asked  whether those  limits are  what the                                                               
city  requires or  if that  is just  what he  carries on  his own                                                               
accord.                                                                                                                         
                                                                                                                                
MR. BARBOSA  stated that is  all that  he could afford  to carry.                                                               
He shared his desire to carry higher liability.                                                                                 
                                                                                                                                
1:38:00 PM                                                                                                                    
                                                                                                                                
ARMAND  FELICIANO, Vice  President,  Property Causality  Insurers                                                               
Association of  America (PCI), explained  that PCI is  a national                                                               
trade  insurance  organization   that  represents  roughly  1,000                                                               
insurance companies nationwide.  He  said that although PCI is in                                                               
support of  HB 132, there  is concern about a  proposed amendment                                                               
that looks to increase the coverage  in period one to one million                                                               
dollars.   He said the main  concern is about affordability.   He                                                               
added  that PCI  believes that  bumping  limits up  in the  first                                                               
coverage  period  would be  cost  prohibitive  for drivers.    He                                                               
pointed out that  it is important to ensure more  drivers are not                                                               
driving  around uninsured  because  they cannot  afford to  carry                                                               
minimum coverages.                                                                                                              
                                                                                                                                
MR.  FELICIANO said  the second  point  he wanted  to discuss  is                                                               
flexibility.  He explained that  if drivers feel more coverage is                                                               
needed in  the first coverage  period ("period one"),  then there                                                               
is nothing in HB 132 that  would prevent a driver from purchasing                                                               
additional insurance beyond the minimum requirements.                                                                           
                                                                                                                                
1:39:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DRUMMOND  asked  Mr.   Feliciano  whether  he  is                                                               
opposed to or in favor of HB 132.                                                                                               
                                                                                                                                
MR.  FELICIANO replied  that  PCI supports  HB  132 as  currently                                                               
drafted.                                                                                                                        
                                                                                                                                
REPRESENTATIVE DRUMMOND  asked Mr.  Feliciano to  clarify whether                                                               
he  would  be opposed  to  the  amendment  that would  raise  the                                                               
insurance coverage limit in period one to $1 million.                                                                           
                                                                                                                                
MR. FELICIANO  expressed PCI's concern  that that  increase would                                                               
make carrying coverage unaffordable.                                                                                            
                                                                                                                                
1:40:50 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   CLAMAN  asked   Mr.  Feliciano   to  share   his                                                               
understanding  about  who, under  HB  132,  would be  paying  for                                                               
period one insurance.                                                                                                           
                                                                                                                                
MR. FELICIANO answered  that he thinks HB 132,  as drafted, would                                                               
allow flexibility  for either the  driver or  the TNC to  pay for                                                               
period one coverage.                                                                                                            
                                                                                                                                
CO-CHAIR STUTES  informed Representative  Claman that  there were                                                               
representatives  from both  Uber Technologies  Inc. ("Uber")  and                                                               
Lyft, Inc. ("Lyft") online available for questions.                                                                             
                                                                                                                                
REPRESENTATIVE  CLAMAN   asked  Mr.  Feliciano  to   assume,  for                                                               
purposes  of  insurance  policy rates,  that  TNCs  are  actually                                                               
paying  for  period  one insurance  rather  than  the  individual                                                               
drivers.   He asked what the  change in higher or  lower coverage                                                               
in period one would be.                                                                                                         
                                                                                                                                
MR.  FELICIANO apologized  that he  did not  currently have  that                                                               
information.   He  shared  that PCI's  concern  is regarding  the                                                               
logic behind period one.   He explained that conceivably a driver                                                               
could just be roaming around  with the application ("app") on and                                                               
no intention of ever engaging  in ridesharing, which is different                                                               
from  period  two where  the  driver  is engaged  in  prearranged                                                               
activity.  He said that  the rationale behind the higher coverage                                                               
in  period two  is  that  passengers would  be  involved at  that                                                               
point.   He  deferred to  the  Uber and  Lyft representatives  to                                                               
further answer Representative Claman's question.                                                                                
                                                                                                                                
REPRESENTATIVE CLAMAN  asked for clarification  whether companies                                                               
or drivers  would pay the  insurance.   He asked Mr.  Matthews to                                                               
share his understanding  of whether HB 132 would  require Uber to                                                               
pay the insurance for drivers.                                                                                                  
                                                                                                                                
1:43:26 PM                                                                                                                    
                                                                                                                                
MITCHEL  MATTHEWS, Senior  Operations Manager,  Pacific Northwest                                                               
Region,   Uber   Technologies   Inc.  ("Uber"),   explained   his                                                               
understanding  that HB  132 would  not  require Uber  to pay  for                                                               
coverage; however,  Uber has  its own  insurance and  drivers are                                                               
welcome to purchase additional coverage for period one.                                                                         
                                                                                                                                
REPRESENTATIVE  CLAMAN  asked  whether  Uber  purchases  all  the                                                               
insurance for periods two and three.                                                                                            
                                                                                                                                
MR. MATTHEWS answered yes.                                                                                                      
                                                                                                                                
REPRESENTATIVE CLAMAN  asked Mr. Matthews  if he could  share his                                                               
best projection of how many drivers Uber would have in Alaska.                                                                  
                                                                                                                                
MR. MATTHEWS  explained that the  number would be subject  to the                                                               
amount of people  who would download the app,  tourism rates, and                                                               
how many people  would be interested in driving  on the platform.                                                               
He  noted  that  when  Uber  was  operational  in  Anchorage,  it                                                               
employed over 80 drivers.                                                                                                       
                                                                                                                                
REPRESENTATIVE CLAMAN, assuming 100  drivers in Alaska, asked Mr.                                                               
Matthews what the  difference in insurance would  be for scenario                                                               
one, a  $50,000-$100,000 policy  in period one  and a  $1 million                                                               
policy for periods two and  three, verses scenario two where Uber                                                               
would have a $1 million policy in all three periods.                                                                            
                                                                                                                                
MR. MATTHEWS said that he could  not answer that question at this                                                               
time,  but he  would  be  happy to  take  the  question back  and                                                               
provide  a  follow-up  answer.   He  explained  that  period  one                                                               
coverage  is similar  to  Alaska's  private passenger  automobile                                                               
insurance  coverage.    He  noted that  Alaska  has  the  highest                                                               
[indisc.] in the  country.  He shared his  understanding that the                                                               
insurance is  engaged simply  by turning on  the app,  so keeping                                                               
the limit  at the state  limit would  remove any moral  hazard or                                                               
risk that  someone would turn on  the app just to  receive better                                                               
coverage without any intention of ever engaging in ridesharing.                                                                 
                                                                                                                                
REPRESENTATIVE CLAMAN  asked Mr.  Matthews whether it  was Uber's                                                               
view that it should never be "on  the hook" if one of its drivers                                                               
gets in an  accident in period one, beyond the  minimum limits in                                                               
the state of Alaska.                                                                                                            
                                                                                                                                
MR. MATTHEWS  clarified it is  Uber's view that the  insurance in                                                               
period  one  represents  the   private  passenger  auto  coverage                                                               
minimum in Alaska.   He stated that Uber would  prefer to keep it                                                               
at  the state  limit  to remove  the moral  hazard  or risk  that                                                               
someone  would scam  the rideshare  system  for higher  insurance                                                               
coverage.                                                                                                                       
                                                                                                                                
1:47:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CLAMAN   asked  Mr.   Matthews  whether   he  has                                                               
statistics about claims made against Uber in Portland, Oregon.                                                                  
                                                                                                                                
MR.  MATTHEWS  said   that  he  does  not   currently  have  that                                                               
information but would be happy to provide it at a later time.                                                                   
                                                                                                                                
REPRESENTATIVE CLAMAN  clarified that he was  asking Mr. Matthews                                                               
to provide both the total number  of rides called in Portland and                                                               
the total number of accidents from periods one, two, and three.                                                                 
                                                                                                                                
MR.  MATTHEWS said  that he  would  have to  confirm with  Uber's                                                               
insurance  team   whether  or   not  those  figures   are  public                                                               
information.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CLAMAN  shared that  some  of  the more  suburban                                                               
Alaskan communities, like Eagle River,  that are 10-15 miles from                                                               
downtown  Anchorage  feel there  is  not  adequate cab  and  taxi                                                               
service  there.     He  described  a   hypothetical  scenario  in                                                               
Anchorage where a driver is parked  two blocks away from the busy                                                               
downtown convention center waiting or  could even be sitting in a                                                               
coffee shop.   He asked  for clarification whether the  driver in                                                               
that scenario would be in period one coverage.                                                                                  
                                                                                                                                
MR. MATTHEWS  indicated that location  does not matter  in period                                                               
one; the driver  could be in his/her house folding  laundry or in                                                               
the vehicle when waiting for a rider in period one.                                                                             
                                                                                                                                
REPRESENTATIVE CLAMAN asked, "If  the driver's sitting two blocks                                                               
from  the convention  center in  his house,  he's in  period one,                                                               
correct?"                                                                                                                       
                                                                                                                                
MR. MATTHEWS  replied that if  the driver had  the app on  at the                                                               
time, then the answer  to the question is yes.   In response to a                                                               
follow-up  question,  he  indicated  that upon  acceptance  of  a                                                               
request received  via the app  and while driving to  connect with                                                               
the rider,  the driver  would be  covered under  period two.   He                                                               
explained  that  period  three  commences  upon  picking  up  the                                                               
passenger and starting the trip.                                                                                                
                                                                                                                                
REPRESENTATIVE  CLAMAN offered  a  scenario in  which the  driver                                                               
returns without  a passenger  to the  starting location  but gets                                                               
involved  in  an accident  on  route  wherein another  individual                                                               
sustains severe  bodily injury.   He  asked Mr.  Matthews whether                                                               
the driver in that situation would be under period one coverage.                                                                
                                                                                                                                
MR. MATTHEWS  answered that  if the driver  was driving  with the                                                               
app turned  on, then  he/she "would  be in  period one,  which is                                                               
reflective of Alaska's passenger/automobile  limit."  In response                                                               
to a follow-up  question, he noted that the driver  could opt for                                                               
self-paid additional  insurance for period one,  but without that                                                               
he/she would  have the following:   $50,000 for  bodily injuries,                                                               
$100,000  for  bodily  injury  per   accident,  and  $25,000  for                                                               
property  damage  per accident.    He  added that  that  coverage                                                               
mirrors Alaska's  private passenger auto insurance,  which is the                                                               
highest  in  the United  States.    In  response to  a  follow-up                                                               
question,  he  said   he  did  not  know   the  minimum  coverage                                                               
requirements set  by the State  of Washington, but he  offered to                                                               
find out and report back to the committee.                                                                                      
                                                                                                                                
1:53:36 PM                                                                                                                    
                                                                                                                                
CO-CHAIR WOOL asked whether the  three insurance coverage periods                                                               
are the same in every state where Uber operates.                                                                                
                                                                                                                                
MR. MATTHEWS  answered yes.   He added  that the language  is the                                                               
same in 41 states.                                                                                                              
                                                                                                                                
CO-CHAIR WOOL  asked whether  Uber has  encountered a  state that                                                               
wants to  have $1 million coverage  no matter what the  driver is                                                               
doing and if Uber would consider such coverage.                                                                                 
                                                                                                                                
MR. MATTHEWS shared  his understanding that no  other states have                                                               
looked to adjust.  He said  that the state of Colorado previously                                                               
evaluated  period  one and  determined  there  was no  reason  to                                                               
change that level of coverage.                                                                                                  
                                                                                                                                
1:56:15 PM                                                                                                                    
                                                                                                                                
CO-CHAIR STUTES,  after ascertaining that  there was no  one else                                                               
who wished to testify, closed public testimony on HB 132.                                                                       
                                                                                                                                
REPRESENTATIVE  CLAMAN asked  whether there  are any  states that                                                               
require under state  law and through regulation that  there be $1                                                               
million held by drivers in underinsured coverage.                                                                               
                                                                                                                                
1:57:44 PM                                                                                                                    
                                                                                                                                
JARED EBER, Associate Counsel,  Insurance, Uber Technologies Inc.                                                               
("Uber"), said that  there are some states that  require that the                                                               
uninsured  motorist/underinsured  motorist (UM/UIM)  coverage  in                                                               
periods two  and three to match  the state requirement.   He said                                                               
that Uber does comply in those instances.                                                                                       
                                                                                                                                
REPRESENTATIVE  CLAMAN  offered  his understanding  that  current                                                               
Alaska law does not require  the underinsured limits to match the                                                               
liability  limits.     He  added  that  there   could  be  higher                                                               
underinsured  and lower  liability  or vice  versa,  so he  asked                                                               
whether  there  are any  states  that  require specific  matching                                                               
amounts for the underinsured and the liability coverage.                                                                        
                                                                                                                                
MR. EBER  shared that  to his  knowledge there  is no  state that                                                               
differentiates  between the  limits of  UM and  UIM; if  both are                                                               
required,  they would  be at  the same  level.   He said  that is                                                               
based on  state statute, and Uber  would follow suit and  do what                                                               
is required in each state under statute.                                                                                        
                                                                                                                                
REPRESENTATIVE  CLAMAN  mentioned   Washington  legislation  that                                                               
actually specifically  lists the amount of  liability coverage as                                                               
$1 million  and the underinsured also  as $1 million.    He asked                                                               
whether Washington is the only state that specifies that amount.                                                                
                                                                                                                                
MR. EBER  said that  he did not  know but would  be happy  to get                                                               
back to the committee with that information.                                                                                    
                                                                                                                                
REPRESENTATIVE CLAMAN  asked Mr. Eber  whether he knew  about any                                                               
of the TNC accident statistics from Portland, Oregon.                                                                           
                                                                                                                                
MR. EBER answered that he does  not have that information at this                                                               
time.                                                                                                                           
                                                                                                                                
2:00:38 PM                                                                                                                    
                                                                                                                                
ANNABEL  CHANG,  Director,  Public Policy,  Lyft,  Inc.  ("Lyft")                                                               
clarified  that  Representative  Claman  is  referencing  figures                                                               
published from a pilot program in Portland.                                                                                     
                                                                                                                                
CO-CHAIR WOOL  asked Ms. Chang  whether Lyft would  still operate                                                               
in  a state  that  raised coverage  limits in  period  one to  $1                                                               
million.                                                                                                                        
                                                                                                                                
MS. CHANG  indicated that of  the states in which  Lyft operates,                                                               
six have  legislation that  reflects differences  between periods                                                               
one,  two, and  three.   She explained  that the  reason for  the                                                               
period one coverage is because a  driver could be home in his/her                                                               
pajamas  and not  in a  car at  all versus  periods two  or three                                                               
where a driver  is actually connected to a ride  or already has a                                                               
passenger  in the  car.   She  said  Lyft would  not  be able  to                                                               
operate  in Alaska  with  the period  one  limits proposed  under                                                               
Version J.                                                                                                                      
                                                                                                                                
2:02:31 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN  asked  whether  Ms. Chang  knew  if  that                                                               
insurance was even available to purchase in Alaska.                                                                             
                                                                                                                                
MS.  CHANG explained  that  in  terms of  periods  one, two,  and                                                               
three,  Lyft   purchases  insurance  through   [Zurich  Insurance                                                               
Group]; however, she pointed out  that the applicable legislation                                                               
provided in other  states allows Lyft drivers  to [buy additional                                                               
insurance]  and  insurance  companies  to  market  new  insurance                                                               
products.   She  listed  State Farm  Mutual Automobile  Insurance                                                               
Company  ("State Farm"),  Government Employees  Insurance Company                                                               
(GEICO), Progressive Casualty  Insurance Company ("Progressive"),                                                               
and Metropolitan Life Insurance  Company ("MetLife") as all being                                                               
insurance   companies  that   created   new  insurance   products                                                               
recognizing the differences  in the TNC model.  She  said that to                                                               
Lyft's  knowledge  the $1  million  period  one coverage  is  not                                                               
available.   She  clarified that  there are  also concerns  about                                                               
"the moral hazard question" relating  to when the state wishes to                                                               
have  [coverage levels  for TNCs]  that are  significantly higher                                                               
than personal insurance limits in  Alaska and even taxi/limousine                                                               
[coverage requirements] in the state.                                                                                           
                                                                                                                                
REPRESENTATIVE NEUMAN,  in follow  up to  Representative Claman's                                                               
comment about minimum requirements,  asked whether there are also                                                               
minimum requirements for taxi drivers.                                                                                          
                                                                                                                                
CO-CHAIR  WOOL said  that local  laws  vary.   He explained  that                                                               
municipality regulations in Anchorage,  Fairbanks, and Juneau all                                                               
require taxi drivers  to carry the following  coverage:  $300,000                                                               
aggregate  injury  sustained,   $100,000  personal,  and  $50,000                                                               
property.   He pointed  out that for  those three  Alaska cities,                                                               
there is  no mention of  any sort of $1  million-dollar insurance                                                               
coverage requirement.                                                                                                           
                                                                                                                                
REPRESENTATIVE NEUMAN asked about  different coverage periods for                                                               
taxi drivers.                                                                                                                   
                                                                                                                                
2:05:23 PM                                                                                                                    
                                                                                                                                
CO-CHAIR STUTES offered her understanding  that taxi drivers have                                                               
only one period of coverage.                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN said  he wants to make  certain the playing                                                               
field is even for a taxi cab company.                                                                                           
                                                                                                                                
CO-CHAIR WOOL  explained that the aforementioned  figures are the                                                               
minimum  requirements and  drivers  can buy  more  coverage.   He                                                               
added, "There's no minimum of  a million dollars ... when there's                                                               
someone in your car or not in your car."                                                                                        
                                                                                                                                
REPRESENTATIVE  NEUMAN asked  whether it  would be  the same  for                                                               
taxi companies as it would be for TNCs.                                                                                         
                                                                                                                                
CO-CHAIR WOOL  answered that  both taxi  drivers and  TNC drivers                                                               
can opt to buy additional insurance coverage.                                                                                   
                                                                                                                                
REPRESENTATIVE CLAMAN asked Ms.  Chang about differing gas prices                                                               
in Seattle and  Anchorage and how that gets accounted  for in the                                                               
price Lyft charges riders.                                                                                                      
                                                                                                                                
2:06:38 PM                                                                                                                    
                                                                                                                                
MS.  CHANG said  that prices  vary  according to  each market  in                                                               
which Lyft operates.                                                                                                            
                                                                                                                                
REPRESENTATIVE CLAMAN asked whether  Lyft's computer systems have                                                               
the ability to factor in  fuel price differences and adjust fares                                                               
according to local gas prices.                                                                                                  
                                                                                                                                
MS.  CHANG answered  yes.   She  elaborated that  a multitude  of                                                               
factors can  be taken into consideration.   She said that  one of                                                               
Lyft's key factors  is competing for drivers and  making sure the                                                               
platform is  appealing to not  only the driver but  the passenger                                                               
as well.                                                                                                                        
                                                                                                                                
REPRESENTATIVE CLAMAN  opined that  the same way  Lyft's computer                                                               
system can  make adjustments for  the rate  of fuel, it  can make                                                               
adjustments to factor  in the differences of  insurance costs for                                                               
Lyft between, for example, Alaska and Washington.                                                                               
                                                                                                                                
MS. CHANG explained  that it would be a  little different because                                                               
insurance is purchased from one  specific provider and [according                                                               
to each  state's requirements].   She added that the  coverage is                                                               
purchased nationwide  depending on the  state.   She  offered her                                                               
understanding  that  Representative  Claman  was  trying  to  ask                                                               
whether Lyft  could adjust  the insurance for  Alaska.   She said                                                               
Lyft could  match the  UM/UIM set  in the state  of Alaska.   She                                                               
opined that  a $1  million coverage for  period one  doesn't make                                                               
sense  for  the TNC  model.    She noted  that  39  states and  6                                                               
insurance-only  states  recognize  the  difference  as  does  the                                                               
National  Conference of  Insurance  Legislators  (NCOIL) and  the                                                               
insurance industry.                                                                                                             
                                                                                                                                
2:08:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CLAMAN asked  Ms.  Chang whether  the $1  million                                                               
coverage  is  required currently  under  Alaska  law or  proposed                                                               
under HB 132.                                                                                                                   
                                                                                                                                
MS. CHANG responded  that currently there are no  rules in Alaska                                                               
regulating TNCs.  She noted that  HB 132 would be the legislation                                                               
regulating and dictating insurance requirements for TNCs.                                                                       
                                                                                                                                
REPRESENTATIVE CLAMAN  shared that he understands  the point that                                                               
has  been   repeated  by   industry  representatives   about  the                                                               
potential for  a driver to not  even be in his/her  car in period                                                               
one  coverage.   He  opined  that a  driver  sitting  at home  in                                                               
his/her  pajamas is  at  a much  lower risk  of  getting into  an                                                               
accident.  He asked Ms. Chang whether she agreed.                                                                               
                                                                                                                                
MS. CHANG replied yes.                                                                                                          
                                                                                                                                
REPRESENTATIVE  CLAMAN  reiterated  his  case for  the  need  for                                                               
higher  period  one  coverage  by  reviewing  his  aforementioned                                                               
scenario  wherein a  driver has  dropped off  a Lyft  customer 20                                                               
miles from  the source of  the next passenger,  is not on  a call                                                               
but the  app is on,  and by chance has  an accident and  hits and                                                               
severely injures  someone.  He  said that he understands  why the                                                               
lower coverage would apply when a  driver is sitting at home.  He                                                               
asked  why there  seems to  be such  a problem  for TNCs  to have                                                               
higher  coverage  for  a  driver working  for  TNC  purposes  and                                                               
anxious to  serve the  needs of the  corporation when  the driver                                                               
may not  be doing personal business  and might just be  trying to                                                               
make  him/herself  more  available   for  rides  to  further  the                                                               
business model.                                                                                                                 
                                                                                                                                
MS. CHANG said  that she would be happy to  provide the committee                                                               
with the  state of  Colorado report that  looked into  period one                                                               
requirements.  She  noted that Colorado was the  very first state                                                               
to  pass TNC  regulations.   She explained  that since  TNCs have                                                               
been operating  there for  a longer  period of  time, it  has the                                                               
most statistical data.                                                                                                          
                                                                                                                                
2:12:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CLAMAN  said  that  he would  like  to  see  that                                                               
report.    He  mentioned  that one  of  the  TNC  representatives                                                               
previously testified  that period  one is actuarially  the lowest                                                               
risk  period for  TNCs.   He asked  Ms. Chang  if, based  on that                                                               
data, she  would agree that  the cost for increasing  coverage in                                                               
period one  would actually  be fairly small.   He  concluded that                                                               
the claim made  by TNCs that the increase would  cost millions of                                                               
dollars might not be supported by actuarial data.                                                                               
                                                                                                                                
MS.  CHANG said  that  she  would be  happy  to further  research                                                               
Representative  Claman's  question.   She  shared  that based  on                                                               
previous  discussions  in  other   state  legislatures  the  main                                                               
concern  is how  to make  sure passengers  are covered  in period                                                               
one.   She stressed  that the period  one coverage  matches state                                                               
insurance levels for personal driving.   She pointed out that not                                                               
only would Lyft  match coverage levels at  the personal insurance                                                               
levels  in the  state  of Alaska,  it would  go  much higher  for                                                               
periods two and three insurance levels.                                                                                         
                                                                                                                                
2:14:01 PM                                                                                                                    
                                                                                                                                
CO-CHAIR WOOL  asked Ms.  Chang how  many drivers  Lyft currently                                                               
employs nationwide.                                                                                                             
                                                                                                                                
MS. CHANG  estimated that Lyft  employs hundreds of  thousands of                                                               
drivers and  connects over 10  million rides per week  across the                                                               
nation.  She noted that  the number of drivers fluctuates because                                                               
some people  only drive seasonally  such as for  school holidays,                                                               
summer break, or just for a short time to meet a financial goal.                                                                
                                                                                                                                
CO-CHAIR WOOL asked Mr. Matthews  how many drivers Uber currently                                                               
has.                                                                                                                            
                                                                                                                                
MR. MATTHEWS answered  that the number of  drivers nationwide for                                                               
Uber is in  the hundreds of thousands.  He  added that the number                                                               
of drivers fluctuates depending on  drivers' specific needs.  For                                                               
example, drivers  could be  driving just  to bridge  a gap  for a                                                               
goal  or only  driving  during  rush hour,  while  some could  be                                                               
taking a break.  He  echoed Ms. Chang's comments about connecting                                                               
millions of rides a week.                                                                                                       
                                                                                                                                
CO-CHAIR  WOOL asked  for confirmation  that  although there  are                                                               
other TNCs,  Uber and Lyft  are the  two largest in  the country,                                                               
and he observed that the cost  of raising the limit in period one                                                               
would vary depending on the size of the TNC.                                                                                    
                                                                                                                                
2:16:59 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DRUMMOND inquired  whether  the available  period                                                               
one  coverage is  the  same in  every state  that  Lyft and  Uber                                                               
already have under contract.                                                                                                    
                                                                                                                                
MS.  CHANG answered  that in  most states  it is  the same.   She                                                               
noted that  while there  are some slight  variations from  one or                                                               
two outliers,  it is not  to the  degree that is  being discussed                                                               
for HB 132.                                                                                                                     
                                                                                                                                
2:17:56 PM                                                                                                                    
                                                                                                                                
MR.  MATTHEWS  said that  period  one  coverage levels  are  very                                                               
consistent in the states where Uber operates.                                                                                   
                                                                                                                                
REPRESENTATIVE  DRUMMOND asked  whether Uber  and Lyft  currently                                                               
operate in 49 states.                                                                                                           
                                                                                                                                
MR. MATTHEWS answered that Uber has  the ability to operate in 49                                                               
states,  and  he  offered  his  understanding  that  the  company                                                               
currently operates in 40.                                                                                                       
                                                                                                                                
MS. CHANG  noted that the numbers  change every day.   She shared                                                               
her belief that Alaska is one of  only a few states where Lyft is                                                               
not currently in operation.                                                                                                     
                                                                                                                                
REPRESENTATIVE DRUMMOND  asked Ms.  Chang to  clarify the  one or                                                               
two outliers she mentioned in an earlier response.                                                                              
                                                                                                                                
MS.  CHANG said  that she  would have  to double  check, but  she                                                               
offered  her belief  that there  are some  pieces of  legislation                                                               
from  2014, when  TNCs were  just coming  online, which  might be                                                               
slightly different.   She said that overall  coverage numbers and                                                               
limits are very consistent.                                                                                                     
                                                                                                                                
REPRESENTATIVE DRUMMOND asked  whether any of the  states Lyft or                                                               
Uber operate  in have health  care costs that  are as high  as in                                                               
Alaska.  She opined  that  while the  coverage  limits have  been                                                               
discussed in today's hearing, what  has failed to be mentioned is                                                               
that Alaska has the highest health  care costs in the nation. She                                                               
recognized that although  TNCs cannot control the  cost of health                                                               
care,  that  factor does  certainly  give  cause for  alarm  when                                                               
considering  the low  level  of  coverage for  period  one.   She                                                               
pointed out that     there  is no way to shop for low cost health                                                               
care in Alaska.  She shared that she is unsure  whether TNCs have                                                               
their drivers' best  interest in mind, in terms  of covering them                                                               
in period  one.  She pointed  out one concern for  Alaska drivers                                                               
is the possibility of hitting a moose.                                                                                          
                                                                                                                                
2:20:52 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KOPP  offered his understanding that  HB 132 would                                                               
set insurance  requirements during  periods two  and three  to be                                                               
three  times   greater  than   what  Alaska   currently  requires                                                               
commercial cab drivers to carry.   He said that no one is arguing                                                               
the  TNC  insurance coverage  for  periods  two and  three  isn't                                                               
pretty  fantastic.   He asked  whether Uber  or Lyft  would alter                                                               
their  decision to  operate in  Alaska if  the basic  requirement                                                               
that taxi  drivers carry coverage  at $300,000 and  $100,000 were                                                               
required of TNCs in period one.                                                                                                 
                                                                                                                                
MR. MATTHEWS  said that  Alaska has the  highest minimums  in the                                                               
United States.   He said  that the  TNC model reflects  that high                                                               
coverage  in period  one.   He  claimed that  if  Alaska were  to                                                               
change that  minimum, then Uber  might have to adjust  period one                                                               
to reflect  that.  He  noted that that  action may cause  Uber to                                                               
have to  reevaluate its decision  to come to  Alaska or not.   He                                                               
shared his  belief that it  is up to  the state to  determine the                                                               
appropriate minimum coverage levels.                                                                                            
                                                                                                                                
REPRESENTATIVE  KOPP asked  for  clarification  about a  previous                                                               
statement regarding period one requirements  in most states being                                                               
basically  the same.    He asked  how much  higher  Alaska is  in                                                               
comparison to other states.                                                                                                     
                                                                                                                                
MR.  MATTHEWS stated  that in  the state  of Washington  coverage                                                               
limits are  $25,000, $50,000,  and $10,000.   He deferred  to Mr.                                                               
Eber  to  explain  the difference  between  Washington  and  what                                                               
limits would be in Alaska.                                                                                                      
                                                                                                                                
2:23:37 PM                                                                                                                    
                                                                                                                                
MR. EBER stated that Alaska's  limits of $50,000 and $100,000 are                                                               
significantly  higher than  those  in the  rest  of the  country,                                                               
which  range  from $20,000  to  $30,000  per person,  $40,000  to                                                               
$50,000 per  accident, and with  a maximum of $15,000  to $25,000                                                               
in  property damage.   He  said that  there are  a couple  states                                                               
where property  damage coverage in  period one is required  to be                                                               
carried  at  $30,000.    He shared  that  typical  state  minimum                                                               
liability requirements are  $10,000 to $20,000 for  injury to one                                                               
person and  $40,000 to $50,000  for multiple people  per accident                                                               
and  $25,000  to  $50,000  for   property  damage.    To  further                                                               
illustrate that  Alaska has high  coverage limits, he  added that                                                               
Florida has $10,000, $20,000, and $10,000 coverage limits.                                                                      
                                                                                                                                
CO-CHAIR WOOL  asked whether  Uber's period  one coverage  in the                                                               
states with  legislation is satisfying those  states' minimums or                                                               
if Uber is  introducing insurance coverage similar to  what it is                                                               
introducing in Alaska,  which just happens to be the  same as the                                                               
state minimum.                                                                                                                  
                                                                                                                                
MR. EBER explained  that Uber is not matching  the state minimums                                                               
in  other  states.   He  said  that  Uber's typical  coverage  is                                                               
similar to  what is  proposed under  HB 132.   He said  that many                                                               
states have  $25,000, $50,000, and  $15,000 coverage limits.   He                                                               
added that even though those  are the minimums, Uber has $50,000,                                                               
$100,000, and  $25,000 coverage  for period  one, except  for the                                                               
rare  couple incidences  where the  property damage  coverage was                                                               
raised to $30,000.                                                                                                              
                                                                                                                                
2:26:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN  asked  whether the  state's  Division  of                                                               
Insurance  has  the  authority  to  change  the  requirement  for                                                               
minimum insurance.                                                                                                              
                                                                                                                                
2:27:03 PM                                                                                                                    
                                                                                                                                
MICHAEL RICKER,  Actuary P/C,  Division of  Insurance, Department                                                               
of Commerce,  Community & Economic Development  (DCCED), answered                                                               
no.  He added that minimums are set in statute.                                                                                 
                                                                                                                                
REPRESENTATIVE NEUMAN  pointed out that  it is a problem  for the                                                               
department not  to have the  ability to make adjustments  when it                                                               
sees problems  arise.  He  posed the  question as to  whether the                                                               
department should have the authority  to make adjustments, and he                                                               
noted it  could do so through  regulation.  He noted  that trying                                                               
to change statue is very difficult.                                                                                             
                                                                                                                                
REPRESENTATIVE  CLAMAN, in  follow  up  to Representative  Kopp's                                                               
question  about raising  minimums from  $50,000 and  $100,000 for                                                               
aggregate  and   liability  coverage   to  match   taxi  coverage                                                               
requirements  of $100,000  and  $300,000, asked  Mr. Matthews  to                                                               
restate the answer to that question.                                                                                            
                                                                                                                                
MR.  MATTHEWS  shared that  although  he  cannot speak  for  Uber                                                               
globally,  he can  say that  the Pacific  Northwest region  would                                                               
have to evaluate  whether or not Uber would  pursue operations in                                                               
Alaska in light of that change.                                                                                                 
                                                                                                                                
REPRESENTATIVE   CLAMAN   offered   his   assumption   that   the                                                               
determination  would be  in part  based on  what the  actual cost                                                               
would be for the slight increase in insurance coverage.                                                                         
                                                                                                                                
MR. MATTHEWS  explained that Uber  would prefer to  determine the                                                               
effects  of  HB  132  in  its entirety  through  a  cost  benefit                                                               
analysis.                                                                                                                       
                                                                                                                                
REPRESENTATIVE CLAMAN asked Ms. Chang  whether, if HB 132 were to                                                               
pass with  higher requirements for  period one, Lyft would  do an                                                               
economic analysis to  determine if the economic  impacts would be                                                               
worth it  to operate  in Alaska,  even if  that meant  Alaska had                                                               
period one requirements different from those in other states.                                                                   
                                                                                                                                
MS.  CHANG answered  that Lyft  would run  an economic  analysis.                                                               
She  clarified that  if coverage  limits were  close in  terms of                                                               
numbers to  those currently being discussed,  in the one-million-                                                               
dollar range,  it would be  very problematic  for Lyft to  try to                                                               
operate in  Alaska.  She  said that if the  coverage requirements                                                               
were  closer to  the $50,000/$100,000/$25,000  limits that  would                                                               
make a much easier case.  She  stressed that period one is a very                                                               
unique model compared  to periods two and three.   She raised the                                                               
moral hazard question  of a driver possibly having the  app on to                                                               
gain  higher coverage,  yet never  intending to  pick up  a fare.                                                               
She said that a  driver in drive mode in an area  where it can be                                                               
difficult to get ride connections  would have the higher coverage                                                               
and that  presents a  moral hazard problem.   She  explained that                                                               
the reason  why the insurance  industry regulators and  TNCs have                                                               
been so  hung up  on the  numbers for period  one is  because the                                                               
lower  coverage recognizes  the different  nature of  period one.                                                               
She  added   that  lower  period   one  coverage   also  provides                                                               
flexibility for insurers  to provide new products  for drivers to                                                               
purchase that  could help to  address some of the  issues without                                                               
having to raise the moral hazard problem.                                                                                       
                                                                                                                                
2:32:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CLAMAN asked  Ms. Chang  to clarify  what exactly                                                               
she  means by  a  moral hazard  [problem].   He  pointed out  the                                                               
various  examples TNC  representatives  have given  in regard  to                                                               
what a  driver could be doing  in period one that  has nothing to                                                               
do with ridesharing  but said none of those  examples address his                                                               
previously stated  example of when  a driver, after  dropping off                                                               
one rider,  is returning  to the original  spot where  he/she has                                                               
more opportunity to get more riders.                                                                                            
                                                                                                                                
MS.  CHANG  clarified  that   Representative  Claman  raised  two                                                               
distinct issues.  Regarding the  issue of a driver returning from                                                               
a remote location back into a  city, she said that Lyft's goal is                                                               
to expand  service areas so  that drivers  can stay in  their own                                                               
neighborhoods and  connect to a ride  within 10 to 15  minutes at                                                               
the most.   She shared Lyft's goal  for the future is  to have no                                                               
large gaps in areas where coverage  is not likely or where people                                                               
would wait a very long time to be  connected to a ride.  She said                                                               
that as  Lyft grows in terms  of size and ridership,  the hope is                                                               
for  those period  one connection  times  to be  reduced so  that                                                               
rides are being  connected within minutes of turning  on the app.                                                               
In regard  to Representative Claman's  second question  about the                                                               
definition of a moral hazard, she  said that in a situation where                                                               
there  are significantly  higher  limits, such  as the  $300,000,                                                               
$100,000,  and $50,000  limits, and  a driver  is driving  around                                                               
with  the app  in  drive mode,  has an  accident,  and submits  a                                                               
claim,  the driver  would have  the higher  coverage limits.  She                                                               
added  that there  could be  a situation  where someone  could be                                                               
potentially tempted to  turn the app to driver mode  just to have                                                               
the   higher  level   of  insurance.     She   shared  that   the                                                               
aforementioned  situation  is  a   known  risk.    She  suggested                                                               
Colorado's reports  would hopefully help  to clarify some  of the                                                               
questions from the committee.                                                                                                   
                                                                                                                                
CO-CHAIR  WOOL  said  that Representative  Claman  bought  up  an                                                               
interesting  situation with  the hypothetical  driver who  drives                                                               
from downtown  Anchorage to  Eagle River.   He offered  a further                                                               
alternative  that the  driver could  stop to  visit a  friend and                                                               
maybe the friend has  a kid who needs a ride  into Anchorage.  He                                                               
clarified that  the period one  situation he is  explaining would                                                               
be a non-work-related situation.   He said that some people might                                                               
argue that the driver would  still be commercially driving if the                                                               
app  was  on while  heading  back  to  pick  up more  fares,  and                                                               
simultaneously  giving the  friend's  kid a  ride,  and thus  the                                                               
driver should  have the highest  level of coverage possible.   He                                                               
posed the question  of whether a TNC should be  responsible for a                                                               
multimillion-dollar policy  in period one  if a driver has  a 20-                                                               
minute window  and needs to  drop his/her  kid off at  school and                                                               
has the huge misfortune of hitting  a kid.  He offered his belief                                                               
that  the essential  question  is whether  a  driver out  running                                                               
errands  with the  app on  constitutes work.   He  contended that                                                               
TNCs should not be required  to have a multimillion-dollar policy                                                               
in period  one, and  he added  that if a  driver wants  that much                                                               
coverage, then  he/she can purchase  it through  his/her personal                                                               
insurance company.                                                                                                              
                                                                                                                                
2:37:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CLAMAN  moved that  the committee  adopt Amendment                                                               
1, labeled 30-LS0522\J.1, Wallace, 3/3/17, which read:                                                                          
                                                                                                                                
     Page 6, line 7:                                                                                                            
          Delete "and"                                                                                                          
          Insert ","                                                                                                            
                                                                                                                                
     Page 6, line 8:                                                                                                            
          Delete "but is not"                                                                                                   
          Insert ", or is"                                                                                                      
                                                                                                                                
     Page 6, line 10:                                                                                                           
          Delete "$50,000"                                                                                                      
          Insert "$1,000,000"                                                                                                   
          Delete "$100,000"                                                                                                     
          Insert "$1,000,000"                                                                                                   
                                                                                                                                
     Page 6, lines 12 - 13:                                                                                                     
          Delete "as required under AS 21.96.020 and                                                                            
     AS 28.20.440"                                                                                                              
          Insert "in the amount of at least $1,000,000 for                                                                      
     death and bodily injury for each person, $1,000,000                                                                        
     for death and bodily injury for each incident, and                                                                         
     $25,000 for property damage"                                                                                               
                                                                                                                                
     Page 6, lines 20 - 31:                                                                                                     
          Delete all material.                                                                                                  
                                                                                                                                
     Reletter the following subsections accordingly.                                                                            
                                                                                                                                
     Page 7, line 1:                                                                                                            
          Delete "or (c)"                                                                                                       
                                                                                                                                
     Page 7, line 17:                                                                                                           
          Delete "and (c)"                                                                                                      
                                                                                                                                
CO-CHAIR WOOL objected.                                                                                                         
                                                                                                                                
REPRESENTATIVE  CLAMAN  stated  that Amendment  1  would  address                                                               
appropriate  coverage  limits.    He opined  that  it  is  really                                                               
interesting  to hear  TNC representatives  point out  that Alaska                                                               
has  the highest  coverage limits  in the  nation and  claim that                                                               
million-dollar coverage would  cost them so much money.   He said                                                               
he  finds  it interesting  that  upon  examination of  variations                                                               
insurance  rates, the  rates don't  go up  uniformly.   He opined                                                               
that to  go from $50,000 in  coverage to one million  is far less                                                               
than  a  20-fold  increase.    He  listed  a  few  different  oil                                                               
companies  and other  types  of companies  such  as delivery  and                                                               
floral  companies that  are all  driving  vehicles with  million-                                                               
dollar coverage.   He stated  that million-dollar  coverage shows                                                               
good corporate practice.                                                                                                        
                                                                                                                                
REPRESENTATIVE  CLAMAN  suggested  that   the  question  with  $1                                                               
million-dollar coverage is not what  the face value is but rather                                                               
what the  actual dollar increase  is for  TNCs to cover  folks in                                                               
period one.   He said that the argument  from TNC representatives                                                               
against million-dollar coverage for period  one, such as a driver                                                               
can be  sitting at home in  his/her pajamas or just  going to the                                                               
store,  are  not the  reasons  for  his concern  about  insurance                                                               
limits.   He said  that Alaska  is not  like a  big city  such as                                                               
Boston,  Massachusetts so  there would  inevitably be  situations                                                               
where  a  driver drops  off  a  fare  in  a remote  location  and                                                               
immediately tries  to get back  to a location where  he/she could                                                               
more advantageously  collect another  fare.   He surmised  that a                                                               
certain amount of risk is included  when a driver is driving back                                                               
from a remote  drop off.  He said that  with Alaska's high health                                                               
care  costs, $50,000  coverage limit  would not  provide for  the                                                               
necessary coverage  in the event of  an injury.  He  said that in                                                               
the  world of  consumer  protection, it  is  really important  to                                                               
increase period  one coverage to  $1 million dollars.   He opined                                                               
that  because  Alaska  is  "out  of  sync"  in  terms  of  UM/UIM                                                               
coverage,  it is  really important  that the  actual underinsured                                                               
coverage be  specifically listed at  one million dollars  so that                                                               
the  coverage  would  match the  one-million-dollar  coverage  in                                                               
periods two and three.                                                                                                          
                                                                                                                                
2:41:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN  stated that  he doesn't  support Amendment                                                               
1.  He shared that he  sees the business environment in Alaska as                                                               
the  reason the  state  seems  to be  able  to  develop only  one                                                               
resource.  He said that  too often industry does risk assessments                                                               
that come back  in the negative and investments in  the state are                                                               
lost.   He  shared  that he  would  like for  Alaska  to be  more                                                               
inviting to  outside industries.   He opined that TNCs  appear to                                                               
be playing by  the same rules by which most  others have to play.                                                               
He concluded  that he  is very  concerned about  putting coverage                                                               
limits in statute.                                                                                                              
                                                                                                                                
CO-CHAIR WOOL spoke to his objection.   He shared his belief that                                                               
Representative  Claman's  concern  is  valid  because  there  are                                                               
underinsured  drivers  driving around  legally  in  the state  of                                                               
Alaska.   He explained  that the drivers  would be  legal because                                                               
they purchased  whatever coverage  the state  required.   He said                                                               
that he  is in agreement  with Representative Neuman  that Alaska                                                               
needs not  to be  obstructionists to new  industries.   He shared                                                               
that he would  hate to not have  TNCs in Alaska.   He offered his                                                               
belief  that 60,000  people tried  to call  an Uber  in Anchorage                                                               
last year.   He declared that  he did not  want HB 132 to  get so                                                               
altered that TNCs would not come to Alaska.                                                                                     
                                                                                                                                
REPRESENTATIVE  CLAMAN  noted   that  TNC  representatives  claim                                                               
drivers can buy  their own higher period  one insurance coverage.                                                               
He pointed  out that  the drivers are  poorly equipped  to spread                                                               
the risk, whereas, if it  were the corporations buying the higher                                                               
coverage,  then the  cost could  be spread  out equally  over all                                                               
company drivers.   He said  the increase could be  built directly                                                               
into the  rate so  that it would  have little to  no impact.   He                                                               
opined that even  with the coverage increase, TNC  fares would be                                                               
lower than the taxi prices.                                                                                                     
                                                                                                                                
CO-CHAIR STUTES asked Representative  Wool if he still maintained                                                               
his objection.                                                                                                                  
                                                                                                                                
CO-CHAIR WOOL answered yes.                                                                                                     
                                                                                                                                
2:44:33 PM                                                                                                                    
                                                                                                                                
A roll call vote was  taken.  Representatives Drummond and Claman                                                               
voted in  favor of  Amendment 1.   Representatives  Neuman, Kopp,                                                               
Sullivan-Leonard, Wool, and Stutes voted  against it.  Therefore,                                                               
Amendment 1 failed by a vote of 2-5.                                                                                            
                                                                                                                                
2:45:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CLAMAN  moved that  the committee  adopt Amendment                                                               
2, labeled 30-LS0522\J.2, Wallace, 3/3/17, which read:                                                                          
                                                                                                                                
     Page 11, line 18:                                                                                                          
          Delete "or"                                                                                                           
          Insert "and"                                                                                                          
                                                                                                                                
     Page 11, line 20, through page 12, line 1:                                                                                 
          Delete all material and insert:                                                                                       
         "* Sec. 8. AS 29.35 is amended by adding a new                                                                       
     section to read:                                                                                                           
          Sec. 29.35.148. Regulation of transportation                                                                        
     network companies. (a) Notwithstanding AS 28.01.010, a                                                                   
     municipality may by ordinance                                                                                              
               (1)  prohibit a transportation network                                                                           
       company or driver from conducting activities under                                                                       
     AS 28.23 within the municipality; or                                                                                       
               (2)      regulate    the   operation   of   a                                                                    
      transportation network company or driver in a manner                                                                      
        that is more restrictive than the provisions of                                                                         
     AS 28.23.                                                                                                                  
          (b)  This section applies to home rule and                                                                            
     general law municipalities.                                                                                                
          (c)  In this section, "transportation network                                                                         
        company" and "driver" have the meanings given in                                                                        
     AS 28.23.180."                                                                                                             
                                                                                                                                
CO-CHAIR WOOL objected for purposes of discussion.                                                                              
                                                                                                                                
2:45:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CLAMAN  said  that at  the  House  Transportation                                                               
Standing  Committee hearing  on 3/2/17,  it was  reported that  a                                                               
number of  cities have  their own  regulations that  are distinct                                                               
from state regulations.  He  offered his belief that Portland has                                                               
its own  regulations that  are more expansive  than the  State of                                                               
Oregon's regulations.  He shared  the importance of local control                                                               
over these  matters.  He  opined that  the state should  not take                                                               
the option for  local control away from municipalities.   He said                                                               
that the committee  heard from both Uber and Lyft  that in cities                                                               
where  regulations  are  independent of  state  regulations,  the                                                               
companies just  adapt.   He offered his  belief that  Amendment 2                                                               
would be  very supportive of  local communities  without changing                                                               
the basic goal of setting a statewide structure for TNCs.                                                                       
                                                                                                                                
REPRESENTATIVE  NEUMAN  asked  Mr.  Ricker  whether  there  is  a                                                               
process where people could appeal to the division.                                                                              
                                                                                                                                
2:47:24 PM                                                                                                                    
                                                                                                                                
MR. RICKER answered that he is not aware of an appeal process.                                                                  
                                                                                                                                
REPRESENTATIVE  NEUMAN expressed  surprise  that  there isn't  an                                                               
appeal process and opined that there should be one.                                                                             
                                                                                                                                
CO-CHAIR WOOL,  in speaking to  his objection,  expressed concern                                                               
that  municipal carve-outs  would create  gaps in  coverage.   He                                                               
said  that  there would  be  instances  where someone  could  get                                                               
dropped off  but not  picked up,  or vice versa.   He  noted that                                                               
Alaska is a  low population state.  He asked  about the origin of                                                               
legislation in  one of  the first cities  to have  TNC operation,                                                               
Seattle,  where  TNCs  were  able  to  negotiate  with  the  city                                                               
individually, as  opposed to a  state like Wyoming, which  is one                                                               
of the  more recent  states to adopt  statewide legislation.   He                                                               
offered his belief that just  like with the insurance limits, the                                                               
statewide  legislation  is  a necessary  component  for  TNCs  to                                                               
operate in more states.                                                                                                         
                                                                                                                                
2:49:12 PM                                                                                                                    
                                                                                                                                
MR.  MATTHEWS said  that Uber  would look  to the  state bill  to                                                               
provide an equal opportunity for  all Alaskans to access enhanced                                                               
transportation  services.   He  said that  Alaska  is similar  to                                                               
Wyoming with  low population density  and vast  distances between                                                               
communities.  He  surmised that a state bill where  the rules are                                                               
enshrined at the state level  would provide a level playing field                                                               
for  all  residents to  be  able  to  access the  technology  and                                                               
ridesharing.  He said that there  is an economic argument that it                                                               
is essentially  less feasible for  a TNC to negotiate  with every                                                               
jurisdiction within a  state with a lower  population density and                                                               
such a large land base.  He  pointed out that in Alaska there are                                                               
over 164 cities,  unified municipalities, and boroughs.   He said                                                               
that  having  to negotiate  with  that  many jurisdictions  would                                                               
create a barrier to the ability of TNCs to operate in Alaska.                                                                   
                                                                                                                                
CO-CHAIR WOOL  shared that  from what he  has gathered  about the                                                               
issues between the  Anchorage Assembly and the  taxi industry, he                                                               
is not so sure  local control is going that well.   He shared his                                                               
understanding that the medallion system  in Anchorage is going to                                                               
be phased  out in the  near future and  there are pushes  both to                                                               
increase  medallions and  not increase  medallions.   He surmised                                                               
that in a limited market, like  Anchorage, the ability to be able                                                               
to add  vehicles to the  system during  peak hours when  there is                                                               
demand and  take them away when  there is less demand  would be a                                                               
good system.   He opined  that local control at  the municipality                                                               
level would be a hindrance to TNC operation.                                                                                    
                                                                                                                                
REPRESENTATIVE CLAMAN  shared that  Amendment 2 would  provide an                                                               
opportunity  for local  control with  no requirement  to exercise                                                               
that  control.   He  said  that TNCs  could  make  their case  to                                                               
municipalities to not exercise that control.                                                                                    
                                                                                                                                
CO-CHAIR  STUTES  asked  if Representative  Wool  maintained  his                                                               
objection.                                                                                                                      
                                                                                                                                
CO-CHAIR WOOL answered yes.                                                                                                     
                                                                                                                                
2:52:22 PM                                                                                                                    
                                                                                                                                
A roll call vote was  taken.  Representatives Claman and Drummond                                                               
voted in favor of Amendment 2.  Representatives Kopp, Sullivan-                                                                 
Leonard, Neuman, Wool,  and Stutes voted against  it.  Therefore,                                                               
Amendment 2 failed by a vote of 2-5.                                                                                            
                                                                                                                                
2:53:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DRUMMOND moved  to report  CSHB 132,  Version 30-                                                               
LS0522\J,  Wallace, 2/27/17,  out  of  committee with  individual                                                               
recommendations and  the accompanying fiscal notes.   There being                                                               
no  objection,   CSHB  132(TRA)  was  reported   from  the  House                                                               
Transportation Standing Committee.                                                                                              
                                                                                                                                
2:54:02 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Transportation Standing  Committee meeting was adjourned  at 2:54                                                               
p.m.                                                                                                                            

Document Name Date/Time Subjects
CSHB132 ver J Amendment #1.pdf HTRA 3/7/2017 1:30:00 PM
HB 132
CSHB132 ver J Amendment #2.pdf HTRA 3/7/2017 1:30:00 PM
HB 132